Apple warranty ads should be examined, says EU justice chief

Summary:Apple's warranty flap continues to stir in Europe, as the bloc's justice chief warns that the limited protection offered to Apple customers should be investigated.

Europe's justice chief has said that Apple's warranty practices should be examined by the Europe's 27 member states, following an ongoing dispute over how long the iPhone and iPad maker should offer product guarantees.

EU Justice Commissioner Viviane Reding said in a letter to European ministers that the Cupertino, CA.-based technology giant should be probed to see whether its practices fall foul of European consumer law, according to Bloomberg, who obtained a copy of the letter.

In the letter, Reding claimed: "Apple prominently advertised that its products come with a one-year manufacturer warranty but failed to clearly indicate the consumers' automatic and free-of-cost entitlement to a minimum two-year guarantee under EU law."

"These are unacceptable marketing practices," she added.

According to German publication Der Spiegel, who also reported the contents of the letter, Reding said: "It seems that Apple failed to provide consumers clear, truthful, and complete information about what they are entitled under EU law."

An European Commission spokesperson confirmed the letter, dated September 21, 2012, was sent to all 27 member state ministers responsible for consumer protection, following complaints from consumer organizations in 11 member states, including Germany, Italy, and Portugal. 

The flap began when Apple was fined €900,000 ($1.2m) by Italian antitrust competition authorities after Apple failed to inform its customers of their consumer rights under EU law when buying a premium AppleCare Protection Plan that extends a product's warranty by a year to two years, despite EU law giving customers an automatic two-year warranty.

Apple appealed the ruling that it "misled" consumers, but lost its bid to overturn the fine. The technology giant soon after updated its warranty pages to include the EU-imposed warranty extension of two years, but customers and consumer groups alike were quick to criticize the firm for its vague language.

Screen Shot 2012-10-01 at 10.54.50
Source: Apple.

The European Commission can investigate matters of antitrust and anti-competitive behavior directly and internally, but when it comes to matters of consumer protection, much of the investigation must be passed on to and carried out by individual European member states; this was recently seen after  Google's privacy policy inquiry was undertaken by French data protection authorities  rather than the European Commission in Brussels.

As noted by Bloomberg, the EU can impose financial penalties against individual member states that fail to enforce EU rules, such as in this case on misleading advertising.

Apple did not respond to questions or for comment immediately outside U.S. business hours.

The Commission spokesperson told ZDNet in an emailed statement: "Apple's advertising policy could be misleading as Apple prominently advertised that its products come with a one-year manufacturer warranty but failed to clearly indicate the consumers’ automatic and free-of-cost entitlement to a minimum two-year guarantee under EU law."

"The Commission wants to make sure that EU law is effectively enforced everywhere in the EU. Consumers need to be confident that their rights apply regardless of the country in which they shop."

Update at 12:20 p.m. BST with additional detail provided by a Commission spokesperson.

Topics: Apple, EU, iPad, iPhone

About

Zack Whittaker writes for ZDNet, CNET, and CBS News. He is based in New York City.

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