The Dixons Group is set to clash head-on with the Government over an initiative it claims will cost it millions of pounds.
Geoffrey Budd, company secretary of Dixons, told an audience of 150 delegates at the Personal Computer Association AGM that a proposal adopted by the EC to extend consumer guarantees will cost the company u310 million a year with a further u30 million in administrative costs. A two-year guarantee scheme will cost it an additional u320 million, he said.
The EC proposal will mean consumers can force retailers and any other supplier to fix products, refund money or exchange goods up to two years after purchase, he said. The same rules will apply to installation of goods.
Although there will be a period of two months consultatation, Budd was not hopeful the terms of the directive could be altered. He said that while the present government is sympathetic to Dixons' representations because it supports deregulation, it will be very hard to fight the proposal.
"They don't want more regulations but they need reasoned facts and costings they can quote otherwise they'll be seen as whingeing Brits," he said.
"This is a bit of bureaucratic nonsense. We received very recently the definitive draft proposal. It applies to all consumer goods from a prawn sandwich to a lawnmower. The draft directive is almost a crib from the UK Sales of Goods Act. The major departure is the reversal of the burden of proof," Budd said.
"It will not be possible for member countries to contract out. Individual member states will be able to apply more stringent rules," Budd said.
"This is an unnecessary and unwarranted intrusion by unelected beaurocrats.
There's going to be a price tag and retailers won't bear the pain alone. Manufacturers will be expected to bear the lion's share," he said.
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