The Department of Trade and Industry (DTI) has given businesses until 15 November to submit their comments on an EU directive which will extend warranties on goods and services for up to two years. The directive will affect everyone in the channel who sells services, installs kit or shifts boxes.
On the face of it, it looks terrible for dealers, but good for consumers. But Keith Warburton, executive director of the Personal Computer Association (PCA) and his members believe, that in the long run, it will make everything cost more as businesses have to build the costs into prices.
The details of the directive are as follows. If you sell something and faults develop within two years of the sale, the seller is liable. For the first year, a customer can request a full refund, repair, replacement or discount. That applies to second-hand goods as well. But the biggest change is on who shoulders the burden of proof.
Under present UK law, it is up to the buyer to prove the goods are defective.
But if the Directive becomes law, that will switch and sellers will have to prove the goods are not defective.
That may seem clear-cut when you are talking about selling simple pieces of kit, like wooden stakes. But imagine the nightmare when one of your customers demands a refund on, say a Pentium machine fitted with all the bells, whistles and other bits and bobs, any of which could go belly up during those two years.
The legislation will apply to software as well as maintaining equipment and installing cables. The cost to a small dealer will be prohibitive.
Member EU countries have been asked to canvass trade associations and other interested bodies. In the UK, the DTI is garnering opinions. But if the commissioners in Brussels vote to enshrine them in European law, it is unlikely that the UK will be able to postpone the day.
Warburton says that after its efforts over the CE debacle last year, the DTI is taking it seriously. Alan Gower of Colossus Computers, has been nominated to express the views of PCA members to a select committee of the House of Lords. If you think it may affect your business, contact the DTI for a copy of the document.
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