Apple Loses Appeal in Italian Warranty Disclosures Case

[MacRumors]

Last year, Apple was fined $1.2 million in Italy over how the company advertises its warranty to customers. Italy's antitrust regulators ruled that Apple has not been providing adequate disclosures about the two free years of product warranty assistance required under Italian law, while also pushing customers to purchase AppleCare extended warranties without disclosing that many of the benefits overlap the standard warranty.

As pointed out by @setteBIT, Apple has lost its appeal [Google Translate] in the case. There will be a followup hearing on May 9th. In the meantime, Apple will have to pay EUR900,000 fine previously assessed by the Italian antitrust authority.

Apple added disclosures to its Italian online store to address the court's concerns, after the initial ruling. It's unclear if those will be returning as part of the appeals court's decision.

This comes on the heels of a series of letters sent earlier this week to European Union regulators from consumers groups in 11 countries asking for action against Apple regarding its warranty practices.

Article Link: Apple Loses Appeal in Italian Warranty Disclosures Case

 

[Kaibelf]

this is good!

How? If this is standard warranty law in Italy why is it Apple's job to make sure the public knows all of this? Isn't that part of their government's job?

 

[bigjobby]

This could set a legal precedence for other parts of Europe and how electrical goods generally are sold in other retail stores. Should be interesting to (hopefully) clarify some consumer rights issues and raise awareness.

 

[Dr McKay]

How? If this is standard warranty law in Italy why is it Apple's job to make sure the public knows all of this? Isn't that part of their government's job?

It's good because Apple was deliberately playing on peoples lack of understanding of the law and trying to sell them a service that was useless to them.

 

[7o7munoz7o7]

Wirelessly posted

Does the Italian law provide phone support through AppleCare at no charge for two years as well? The AppleCare not only covers hardware, but unlimited phone support for the full three years as well...just a question

 

[SlugBlanket]

It's almost akin to the mis-selling of Payment Protection Insurance schemes for credit cards that were so prevalent over here in the UK, where banks pushed this on customers who didn't need it or ask for it. Many banks have had to put aside billions to cover the resultant miss-selling occurances.

If Apple had stated where this law applies (primarily European Community) that customers purchases were warranted for the first 2 years but they had the option of extending it for an additional year at a cost, then there would be no problem.

In Apple's defence, Applecare in addition to extending the warranty also provides for telephone support which is not mandated under European Law. Some would question the value of that telephone support given that most people wouldn't use it and if they did, is it worth what Apple is charging?

There are also reports that when some customers in those parts of the European Union that are covered by this law tried to have their machines looked at for warranty repairs more than 12 months after purchase but less than 24 months, Apple refused to honour their legal obligations. It is this point that is the most worrying with regard to Apple's behaviour and for this reason alone I welcome the ruling and hope that Apple is brought to task to honour such obligations.

As an aside, if a customer purchases an Apple computer under the UK Education scheme, Apple implements an automatic standard 3 year warranty which includes Applecare on the product. I was made aware of this by this thread on these forums.

Like many others I was prepared to purchase Applecare at the point of ordering until I read that thread. I can confirm the accuracy of the information as my MBP has an attached 3 year Applecare contract. There are others in my extended family that were not aware of this, and at point of sale (under the Education scheme) were not told of this even though they paid the additional cost of the Applecare scheme. At the very least they should have been made aware of this by the system after purchase at some point.

If Apple are able to sell machines under the UK Education scheme at a discount of up to 17% (the University discount I was quoted for a 6 core Mac Pro last year) and also include 3 years Applecare at no additional cost, it should not be a problem for them to at least inform where appropriate that a 2 year warranty for parts (not Applecare) already exists.

Apple are not obligated to ensure customers know all their statutory rights but they should be reticent to not "push" products that offer arguable value over those rights. As an Industry leader they should have industry leading ethics as good as their products which are exceptional.

 

[thundersteele]

Applecare provides more support (and for a longer period) than italian and other european mandatory warranties demand. Apple can continue to sell AppleCare, including phone support and excellent service.

What Apple is not allowed to do is to promote AppleCare by saying that there is only one year of limited warranty on new products! This is what they were fined for.

The ruling is good for consumer protection in Europe. This will also apply to HP, Dell, and other US manufacturers (most Asian manufacturers already give 2 years of warranty in europe!).

----------

There are also reports that when some customers in those parts of the European Union that are covered by this law tried to have their machines looked at for warranty repairs more than 12 months after purchase but less than 24 months, Apple refused to honour their legal obligations. It is this point that is the most worrying with regard to Apple's behaviour and for this reason alone I welcome the ruling and hope that Apple is brought to task to honour such obligations.

Just as a side remark, the mandatory warranty is different from what AppleCare offers:
a) The vendor is responsible/liable, not the manufacturer. So those who didn't buy directly from Apple have to go elsewhere to get their repairs
b) If the device is older than 6 month, the consumer has to prove that it is a manufacturing defect, and not something that broke later
c) Service centers will not provide service, unless the device was bought there
d) You actually have to bring in the device to some apple store, since there is no phone support

Point b) can be used to reject most claims without violating any laws. It is very hard for a layman to prove that a defect was there originally.

 

[charlituna]

Wirelessly posted

Just as a side remark, the mandatory warranty is different from what AppleCare offers:
a) The vendor is responsible/liable, not the manufacturer. So those who didn't buy directly from Apple have to go elsewhere to get their repairs
b) If the device is older than 6 month, the consumer has to prove that it is a manufacturing defect, and not something that broke later
c) Service centers will not provide service, unless the device was bought there
d) You actually have to bring in the device to some apple store, since there is no phone support

Point b) can be used to reject most claims without violating any laws. It is very hard for a layman to prove that a defect was there originally.

If that is true then AppleCare is not a watse etc. because AppleCare covers any device bought from any authorized reseller plus they don't care when the defect happened so long as you didn't drop it etc

 

[wikus]

How? If this is standard warranty law in Italy why is it Apple's job to make sure the public knows all of this? Isn't that part of their government's job?

LOL, what?!

I don't think the Italian Government sells Apple products.

 

[SlugBlanket]

Applecare provides more support (and for a longer period) than italian and other european mandatory warranties demand. Apple can continue to sell AppleCare, including phone support and excellent service.

What Apple is not allowed to do is to promote AppleCare by saying that there is only one year of limited warranty on new products! This is what they were fined for.

The ruling is good for consumer protection in Europe. This will also apply to HP, Dell, and other US manufacturers (most Asian manufacturers already give 2 years of warranty in europe!).

----------



Just as a side remark, the mandatory warranty is different from what AppleCare offers:
a) The vendor is responsible/liable, not the manufacturer. So those who didn't buy directly from Apple have to go elsewhere to get their repairs
b) If the device is older than 6 month, the consumer has to prove that it is a manufacturing defect, and not something that broke later
c) Service centers will not provide service, unless the device was bought there
d) You actually have to bring in the device to some apple store, since there is no phone support

Point b) can be used to reject most claims without violating any laws. It is very hard for a layman to prove that a defect was there originally.

I think thundersteele hits the nail on the head in his second paragraph. My point about Apple not honouring its obligations for machines older than twelve months still stands however as there are many examples of Apple using point b) as a sharp practice to cover this. Apple's general stance seems to be if you haven't got Applecare and it's past 12 months, they will use every opportunity not to take ownership, even if you purchased directly from them. Don't forget this ruling and discussion is about their online site and stores, no one is complaining about the terms offered when purchasing from a third party or alternative vendor of their products.

 

[Husky1992]

Wirelessly posted

If you want to sell something in italy you MUST guarantee a 24 month warranty, it doesn' t matter how good is apple's 12 month warranty. Do you guys in the US have only a 12 month warranty?

 

[CmdrLaForge]

That's good news. In particular on the iOS devices AppleCare is just two years and that adds very little (telephone support) to what is required by law.

 

[bergert]

Warranty

Wirelessly posted

If you want to sell something in italy you MUST guarantee a 24 month warranty, it doesn' t matter how good is apple's 12 month warranty. Do you guys in the US have only a 12 month warranty?

The "guys" in the US have 90 days consumer warranty; check here:
http://store.apple.com/it/product/MD007T/A?fnode=MTY1NDA2Mg

And the issue is that if my iMac electronics do breaks down; then by definition it is a defect which was present at the time of purchase. Because my colleagues iMac did not break down. Unless I do harm to the machine (falls; punches, spills, etc) I am covered. Any by the way; accidental damage is excluded from applecare as well (iPhone water damage!).

The issue, is Apple's blatant ignorance for local laws; they put a disclaimer - instead of updating their web-page:
http://store.apple.com/us/product/MD006LL/A
shows one year warranty against defects for hardware - not TWO !

Yes, and in the fine print for the EU directive you can read that the burden of proof reverts after 6 months. But if a company has a normal presence and friendly staff- they will not ask you to for proof why the CPU broke; if obviously the iMac is in good condition externally and was not tampered with. Fly-by-night retailers on the other hand will use this to give consumers a hard time.

 

[bushido]

Wirelessly posted

Does the Italian law provide phone support through AppleCare at no charge for two years as well? The AppleCare not only covers hardware, but unlimited phone support for the full three years as well...just a question

phone support is about is useful as talking to the wall

 

[jlc1978]

Wirelessly posted

If you want to sell something in italy you MUST guarantee a 24 month warranty, it doesn' t matter how good is apple's 12 month warranty. Do you guys in the US have only a 12 month warranty?

Yes. It's also one reason the US prices tend to be lower then the EU's ex-VAt since Apple includes expected higher warranty cost in the EU pricing.

As for AppleCare, it provides greater protection, as others pointed out, than the EU consumer protection directive; since it covers any defects, provides tech support, offers worldwide coverage and adds a year to the original warranty. Whether or not it is worth it is an individual decision. Apple simply offers it separately to keep the price down on Macs and other products.

 

[ucmj22]

LOL, what?!

I don't think the Italian Government sells Apple products.

And Apple doesnt make italian laws.... whats your point

 

[Plutonius]

Apple should give a two year warranty and stop selling Applecare overseas if it's that confusing to the people there.

They should also raise their international prices to cover the additional year of warranty.

 

[charlituna]

Apple's general stance seems to be if you haven't got Applecare and it's past 12 months, they will use every opportunity not to take ownership, even if you purchased directly from them.

Which is still within keeping for the law in question. You have to prove that it was there from the start. If you can't, Apple is off the hook. So the real issue is the way the law was written.

Apple warranties any defects regardless of when they happened for that one year or the 2-3 with Apple Care. That's not the same as what the extended 'warranty' law covers. Which is why Apple appealed. And probably will again because if they just pay then every country with a similar law will try this and those $1.2 million payoffs will add up

----------

T
The issue, is Apple's blatant ignorance for local laws; they put a disclaimer - instead of updating their web-page:
http://store.apple.com/us/product/MD006LL/A
shows one year warranty against defects for hardware - not TWO !

Check the link, that's the US where you get a one year warranty (only 90 days is required by law as I recall).

 

[TheAustrianGuy]

You need to be familiar with EU law to understand this.

It is much easier to explain in German, because there are two different terms for the two different kinds of warranties:

Garantie
...and...
Gewaehrleistung

While the term "Garantie" stands for the warranty the manufacturer gives you, the term "Gewaehrleistung" means that whoever sells something has to make sure whatever he sells you is OK at the time of the sale for a period of 2 years for movable goods, and 3 years for fixed goods (floor, windows,...).

This is where it gets tricky.
If a defect shows up within the first 6 months after the sale, the law says that the defect has been there all along, and the seller has to either repair or replace what he sold you.
However, if a defect shows up after the first 6 months have passed (you as consumer are still well within the 2-year period then!), the consumer has to prove to the seller that the defect HAD BEEN THERE AT THE TIME OF SALE.
This is virtually impossible to prove in the most cases. How should you as a consumer prove that the TV set that stopped working stopped working because of a defect that had been there since the beginning?

This is where the manufacturer's "Garantie" kicks in.
Because it is virtually impossible to get any service from the seller after 6 months, you have to rely on the manufacturer's "Garantie".
In Apple's case, this period lasts 12 months, or 2 to 3 years total if you have AppleCare.
For many other manufacturers, the "Garantie"-period is much longer, but there is - AFAIK - no mandatory "Garantie" period manufacturers offer (but all manufacturers do it because if they wouldn't do it, no one would buy their stuff).

Long story short:
If for example an iPad or a MacBook fails after 7 months, under EU law, you would have to prove to the seller that the defect had been there all along, which in most cases is not possible. So the seller can send you away without offering help without violating any laws.
But Apple will repair the iPad or MacBook, because it's still within the 12 months manufacturer's warranty. If you have AppleCare, it would be 24 months (iPad) or 36 months (MacBook) of Apple warranty.

The problem is most people (almost all of them) don't get the difference between "Garantie" and "Gewaehrleistung" (in some languages, there are not even two different words for the two different concepts), and think Apple gouges them by selling them AppleCare.
But in fact Apple doesn't. (Which shouldn't mean Apple's standard warranty period of 12 months is enough - in fact, it's laughable and a shame).

 

[dvader1961]

Point b) can be used to reject most claims without violating any laws. It is very hard for a layman to prove that a defect was there originally.

That's probably a weak thing in the EC Directive and was not meant for electronics. If Apple decides to dodge warranty claims by using this clause i'm quite sure the EC will change that bit. And it will certainly not help Apple. Look at what happened with Microsoft if you mess with the EC.

 

[ucmj22]

That's probably a weak thing in the EC Directive and was not meant for electronics. If Apple decides to dodge warranty claims by using this clause i'm quite sure the EC will change that bit. And it will certainly not help Apple. Look at what happened with Microsoft if you mess with the EC.

I missed the thread where microsoft went bankrupt and sold off their assets! when did this happen!

 

[MRU]

Does this effect UK and Ireland too ?

 

[dvader1961]

Does this effect UK and Ireland too ?

Well, in the UK you have the Sale of Goods Act. Brits think this is superior to the EC Directive but in fact this is not true. Basicaly, if you have problem with an Apple product without Applecare ,you are going to pay ( for the 2nd year) unless you have the guts to go to court. I dunno about Ireland.

 

[thundersteele]

That's probably a weak thing in the EC Directive and was not meant for electronics. If Apple decides to dodge warranty claims by using this clause i'm quite sure the EC will change that bit. And it will certainly not help Apple. Look at what happened with Microsoft if you mess with the EC.

How this rule is used by retailers is not being discussed right now. I've read from others that they got free repairs from Apple using this law. They usually say that the sales personnel is at first confused, but then usually offers to take care of the repair after an explanation.

As others have stated, it is not Apples job to inform customers about their rights. The only problem is that right now, the mis-inform their customers, which is not acceptable.

Apple gives 1 year manufacturer warranty on all sold products.
In addition, there is a 2 year limited warranty that the vendor of the product has to provide.
This is a very tricky situation, because Apple sometimes is the vendor, and sometimes apple is not the vendor. As far as I know, the retail and online stores are registered as different companies in Europe. If you buy online, and bring it to an Apple store for repair, the Apple store might not have to provide service.

 

[C. Alan]

After reading the discussions of the EU consumer right laws, I must say that this may be a case of someone at Apple trying to push United States sales tatics on their European units without knowing the backlash it would create.