EU plans stronger consumer law enforcement after Apple warranty case

EU plans stronger consumer law enforcement after Apple warranty case

Summary: The European Commission is frustrated that its member states have on the most part failed to take action against Apple for flouting EU law, and warns that enforcement must be actioned in order to protect the rights of ordinary citizens.

SHARE:
TOPICS: Apple, EU
22

Europe's justice chief has warned that European authorities "cannot sit on the side-lines" of enforcement issues, following a case that saw little action taken against Apple's unlawful warranty practices in the region. 

Opera-France-Apple
Apple Store in Paris, a retail outlet subject to EU warranty and consumer laws. (Credit: Apple)

In 2011, Apple was fined €900,000 ($1.2m) by Italian authorities for misleading advertising relating to its AppleCare Protection service. In short, EU consumer law dictates that consumers are entitled to two years of warranty. Apple, however, only provided one, with an additional premium warranty 'bolt-on' for an additional year. 

Apple lost its appeal to the case the following March, shortly after which consumer groups in 11 European states complained that AppleCare warranties violate EU law. A formal notice was issued by the European Consumers' Organisation requesting that the company no longer sell products with a one-year warranty.

But the European Justice Commissioner Viviane Reding said today at the European Consumer Summit in Brussels that little was done, and that the "approaches to enforcement turn out to be very diversified and inconsistent at a national level."

While it is the role of the member state authorities to enforce EU-dictated laws, Reding said today that the Commission could take a "more prominent role in monitoring and coordinating coherent enforcement of EU consumer rules by the member states."

Only under EU antitrust and competition law can the Commission bring cases against companies, therefore the Commission wants better, cross-border co-operation in bringing those who flout EU consumer laws to justice.

"We can join forces with national enforcement bodies, reinforcing cooperation to ensure a more consistent interpretation and enforcement of the consumer acquis [laws]."

She said today that as a result of the Apple warranty fiasco, where member states effectively didn't react to Italy's ruling, the Commission will "pay particular attention to recurring issues, where essentially the same problem occurs in different Member States."

A European Commission spokesperson confirmed to ZDNet today that current EU consumer laws are "solid" and there are no plans to change them. 

Italy jumps, other member states keep mum

When Reding sent a letter dated September 21, 2012 regarding the Apple case in Italy, 13 member state ministers in charge of consumer protection did not respond to her request for information.

In the letter, Reding said that Apple's warranty adverts should be investigated after the company "failed to provide consumers clear, truthful, and complete information about what they are entitled under EU law."

"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," she wrote.

She dubbed Apple's practices as "unacceptable." 

According to a European Commission document seen by ZDNet, only five EU member states — including Italy — have taken any action against Apple for its allegedly infringing advertisements. Denmark, Finland and Luxembourg are currently investigating the company, while only Bulgaria and Italy have imposed their own fines. 

Belgian authorities plan to further investigate the company.

A number of outstanding concerns from many countries remain, however. Many have found that Apple's European websites "present elements of inadequate information" or are simply "not compliant" with EU or local state law, while others have warned that "Apple's distributors sometimes refuse to honour the legal guarantee after the commercial warranty has expired."

"The approaches to enforcement turn out to be very diversified and inconsistent at a national level. In at least 21 [out of the 27] EU countries, Apple is not informing consumers correctly about the legal warranty rights they have."

"This is simply not good enough," she commented. 

Bad product, bad Apple?

The iPhone and iPad maker subsequently extended its warranties for products sold in the EU, but received criticism for seemingly shifting the blame away from the company's supply chain to end-users.

While European consumer law says a repair or replacement can be given if (emphasis mine) "defects present when customer takes delivery," Apple's limited warranty says when "defects present after customer takes delivery." 

ZDNet reported yesterday that Apple Australia has changed its warranty policy to fall closer in line with Australian law.

Australia's consumer laws changed in 2011 to give consumers a basic level of guarantee for products, including electronic goods, that allow those who have bought electronic products to have them repaired, even "after any manufacturer's voluntary or extended warranty has expired." However, as ZDNet's Spandas Lui explains, the catch is that this right only applies "for the amount of time that is reasonable to expect, given the cost and quality of the item."

While not an illegal act under Australian law, Apple does not adequately explain the rights its buyers have when they buy an Apple-branded product. 

Topics: Apple, EU

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.

Talkback

22 comments
Log in or register to join the discussion
  • More anti-Apple propaganda from Microsoft CNet/ZDNet

    Microsoft's bought Euro Commission people and ZDNet working for the Microsoft dollar.
    zato_3@...
    • Now THAT was funny

      "Microsoft's bought Euro Commission people"

      The sad thing is that you and your apple peers all believe it.
      toddbottom3
      • Not all of us

        I am opposed to all extended warranties including Apple Care. This article to me says more about European governements, who actually protect the rights of their citizens, as opposed to their North American counterparts, that have become multi billion corporation lap dogs.
        MG537-23482538203179240121698430309828
    • Lol Yeah...

      They just fined Microsoft what? a billion dollars for not including a check-box?... but yeah. They are totally in Microsoft's pocket.
      mrefuman
  • Talking about EU.

    EU should be ashamed for failing to take action against Google for all its illegal and corrupt business practices.
    Owlll1net
    • I could be wrong...

      ...but I think they (EU) are working on it. Like anything that involves the courts, it takes time. I'm pretty sure that they will take action and levy some fines. It just remains to be seen what the exact nature of the offenses are going to be, the price, and (obviously) when.
      rock06r
    • What illegal practices would that be?

      List them.
      jessepollard
  • Europeans are delusional

    On the one hand they must protect "ordinary citizens" from Apple, yet on the other they are stealing 10% of the value of customer deposits in Cyprus.

    I suppose fascism never dies in the German-controlled EU. Why bother killing people to build an empire when you can extort money without firing a bullet?
    croberts
    • apple should pull all their products from Europe

      That is always an option for that poor victim you call apple.
      toddbottom3
    • Why don't you try passing that sentiment on...

      ...to the German people. If I'm not mistaken, they've contributed great sums of money to several bailouts already, when other countries shared zero of that pain. If you think that this somehow morally obligates them to keep funding every country that is bankrupt, you're plain wrong.

      Cyprus is a vacation spot for many very wealthy Europeans. How does a country, full of wealthy Europeans, go bankrupt? Why don't you study how the Cyprus bank is tied with the Greek Bank system, and how they both suffered since the June 2012 crisis.

      Instead of blaming it on German people that perhaps go there for vacation, you should look at the Cyprus people and their elected government first. Why pick on the Germans? Why not the English? Or the French? Aren't they all part of the European Union? Could it be that there is some kind of envy when it comes to Germany?

      After all, Germany pulled itself out of complete rubble after 1945, and then successfully renovated its Eastern half after 1991. It accomplished both in record time, and with great success. Do you think French people, working 32 hours a week could do this? How about the Cyprus workforce? What is their industry, what are their hours? Did you know that they have the most educated workforce in Europe, but no industry to speak of?

      What does that spell? Anyone? Anybody out there that perhaps stayed awake in Social Studies and Economics?

      How about: "Economic Disaster".
      rock06r
  • I would suggest a fine of $1 billion

    After all, apple has been told repeatedly what they must to do satisfy European laws and have repeatedly done nothing to fall in line with those laws.
    toddbottom3
    • If that's the case, then yeah

      I actually do agree that if they repeatedly defied Europe's laws, the EC would need to do something about it; otherwise, it would set a bad example.

      (If 11 separate EU members are complaining, that suggests that there's likely something to the complaints, after all)
      Third of Five
    • Read the article again

      The various nations aren't making this claim, the EU is. The EU is annoyed that it doesn't have power to force the member states to enforce the laws the way the EU thinks they should. This isn't about Apple. This is about a EU power grab.
      baggins_z
      • I did read the article

        apple is breaking EU laws. That much is undeniable. This is absolutely about apple breaking the law and how they best need to be punished for it.
        toddbottom3
  • I think national governments can adequately protect their own consumers

    The EU really doesn't need to be involved in this issue at all.
    John L. Ries
    • The point...

      is that each member state does have laws stating this, but they are not enforcing them. That is what has the commission riled up.
      wright_is
  • Sigh. The real story here is the EU

    power grab over member states. Apple is just the current useful tool to accomplish that.
    baggins_z
    • That's not the real story

      The real story is watching you defend the hive.
      toddbottom3
  • Big Brother

    Yes, we definitely need the EU Big Brother to treat corporations as guilty until proven innocent and not free to decide how long a warranty they think is appropriate for their products.
    FDanconia
    • I know, right?

      "not free to decide how long a warranty they think is appropriate for their products."

      What next, the EU isn't going to allow companies to include the browser they think is appropriate for their products?
      toddbottom3