ACCC to tighten up mobile industry's handset warranties

Stuart Corner
Monday, 15 March 2010 09:31

IT Policy - Regulation

The ACCC is hoping to put in place an industry-wide agreement with mobile industry players to prevent service providers and retailers misrepresenting to consumers' their statutory rights when their handset develops a fault.

It is also hoping to get the industry to follow VHA's lead in offering 24 month warranties instead of the standard 12 month - a move that would provide warranty cover for the whole of the usual mobile service contract period.

The move was announced by ACCC chairman, Graeme Samuel, in his speech to Atug's annual conference on March 12. He said the agreement would follow a similar scheme developed to curb the mobile industry's over-zealous use of terms such as "unlimited" in its advertising.

It also follows the ACCC receiving court enforceable undertakings from two mobile service providers in the past 12 months - M2 in April 2009 and the 3 arm of VHA in January 2010 for breaching the statutory warranty provisions of the Trade Practices Act.

Samuel said: "Both M2 and Hutchison (prior to its merger with Vodafone) had represented that consumers with a faulty mobile phone could only have it repaired, when statutory rights in some cases entitle a consumer to a refund from a retailer, and this cannot be excluded."

M2 had also claimed, erroneously, that pre-installed software would not compromise the phone's compatibility with other networks and that phones would work on any network when in fact they were not compatible with Next G.

Samuel added: "Significantly, VHA agreed in the undertaking to introduce a voluntary 24 month warranty on mobile phones it supplies – with an exception in relation to Apple iPhones. The 24 month timeframe is important because it now means that consumers' mobile phones will be covered by a warranty for the entire length of a standard service contract.

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