Consumer Product Guarantees by Twigg-Flesner Christian;

Author:Twigg-Flesner, Christian;
Language: eng
Format: epub
Publisher: Taylor & Francis Group

5.8.7 Which option should be preferred?

The utilisation of guarantees as an informal redress mechanism will not require a significant degree of substantive regulation. It was seen in chapter 4 that consumers can consider the terms of a guarantee in assessing whether it would be worth their while to try to resolve a product quality problem informally through complaining to the guarantor. It is therefore crucial that the consumer is not hindered in evaluating a guarantee for this purpose. This process is best supported through the introduction of disclosure rules that require the guarantor to specify how to bring a complaint, against whom the complaint can be brought, the range of remedies that may be considered by the guarantor and the allocation of costs for honouring the guarantee. With these details, it will be easier for the consumer to make a decision on how to resolve the quality problem that he has encountered with a particular product.

It is not necessary, and would be rather counter-productive, if more specific rules regarding the substance of a guarantee were adopted. There are two reasons for this: first, the framework aimed at promoting informal complaints does not envisage that consumers will compare guarantees given with different products before they make a purchase. Rather, it acknowledges that consumers are most likely to read a guarantee once they have encountered a problem. At that point, they are faced with the decision how to proceed and who to complain to. If, after reading the guarantee, the consumer feels that a satisfactory solution to the problem could not be obtained by complaining to the guarantor, he could then either decide to complain to somebody else (such as the retailer if the manufacturer is the guarantor), or on the basis of his statutory rights.

The second reason is that guarantors will not have uniform procedures for dealing with guarantee claims. It has already been explained that some deal with guarantee claims in-house, some through a repair network and others through the retailer. Smaller manufacturers may impose an initial cost on a consumer for the return of the product for inspection, whereas larger manufacturers are better placed to absorb such costs and do not require the consumer to bear such costs. This variety and relative freedom to determine how to handle claims under a guarantee is fundamental to giving consumers the opportunity to establish whether an informal complaint is likely to be met with a favourable response. If more uniform rules were introduced, consumers would be deprived of this opportunity, and they would no longer be able to rely on guarantees in deciding how best to solve a product quality problem. Thus, as far as the substantive regulation of guarantees is concerned, this should be limited to disclosure rules.37

It is important to appreciate that the information disclosed in accordance with this rule would be made available to a consumer at a time when he is more likely to be able to use it. During the purchasing process, a consumer is unlikely to pay a great deal of attention to the details of a guarantee.

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