The extent of a warranty
The extent of a warranty has been clearly delineated in the Civil Code. If, for example, a purchaser discovers a defect in a purchased item during the warranty period, he has the right to demand that the seller repair the item free of charge, reduce its price, or replace it with another item. He also has the right to return the item and receive a refund.
Article 21 of the Law on the Protection of Consumers’ Rights (LoPCR) supplements the Civil Code by providing details on the warranty obligations of traders, not just sellers as defined in the Civil Code.
Warranty shall be provided on goods, parts and accessories as agreed by parties or required by law. A trader of goods, parts and accessories subject to warranty shall:
1. Fully perform its obligations to provide warranty on its goods, parts and accessories;
2. Provide consumers with a warranty card which must specify the time of maintenance. Such time is excluded from the warranty period. When the goods trader replaces parts or accessories or change the goods, the warranty period for such parts, accessories or goods shall be counted from the time of replacing those parts or accessories or changing the goods;
3. During the time of maintenance, provide consumers with similar goods, parts, or accessories for temporary use or offer another solution accepted by consumers;
4. Change or recall similar goods, parts, or accessories and refund consumers when it, past the time of maintenance, fails to repair or correct the faults;
5. Change ore recall similar goods, parts, or accessories and refund consumers when it fails to correct the faults after three or more times of maintaining such goods;
6. Pay expenses for the repair and transportation of goods, parts, and accessories to maintenance places and from such places to consumers’ places of residence; and
7. Be held responsible for warranty on goods, parts, and accessories for consumers even when it authorises another organisation or person to provide such warranty.
The concept of a “product” as the term used in the LoPCR has historically been very broad. Traders may have difficulties in determining whether the item they are offering is a “product,” and may also have difficulty assessing defects of the product or determining who is liable for a defect.
The Law on Quality of Products and Goods (LoQPG) mentions “defect” of products. However, the word “defect” seems to mean only “poor quality”. The LoPCR goes beyond this. Under the LoPCR, a defective product is a product which is not safe for consumers and which can cause death, personal injury, or property damage, even if those products have been manufactured in accordance with current technical standards or specifications, and even if the manufacturer is not aware of the defects at the time the products are sold.
There may be defects in the technical design of mass manufactured products. Defects may arise from the manufacture, processing, transport, or storage of singly manufactured products. Defects may also result from a failure to provide adequate instructions or warnings on potentially dangerous products.
In other words, quality is not the only factor involved in determining whether a product is defective under the LoPCR. One must also consider design, whether consumers are properly instructed on use, or whether the consumer has been warned of dangers.
Article 23 of the LoPCR outlines the responsibilities for compensation of damage caused by defective goods. Goods traders shall pay damages when their defective goods harm the life, health, or property of consumers even when they are not aware about or not at fault for such defects, except in one case defined in Article 24 of the same law.
Goods traders provided in Clause 1 of the article include goods producers; goods importers; organisations and persons with their commercial names on goods or using trademarks or commercial indicators showing that they are goods producers or importers; and direct suppliers of goods to consumers in case those responsible for paying damages specified in the first three points of this clause are unidentifiable.
Source: Law on the Protection of Consumers’ Rights