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Loren

US FTC Makes Changes to Magnuson - Moss Warranty Act

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The US Federal Trade Commission recently announced changes to the interpretations of the 1975 Magnuson-Moss Warranty Act.
The changes had to do with certain dealers and/or shops denying warranty claims because aftermarket (non OEM) parts were used or because someone other than a dealer made a previous repair. This was called "tying" by the FTC.
 
The tying prohibition of the MMWA, part 700.10©, was amended (bold and italicized portions) by the FTC as follows:
 
"No warrantor may condition the continued validity of a warranty on the use of only authorized repair service and/or replacement parts for non-warranty service and maintenance (other than an article or service provided without charge under the warranty or unless the warrantor has obtained a waiver pursuant to section 102© of the Act, 15 U.S.C. 2302©).
 
For example, provisions such as, “This warranty is void if service is performed by anyone other than an authorized ‘ABC’ dealer and all replacement parts must be genuine ‘ABC’ parts,” and the like, are prohibited where the service or parts are not covered by the warranty…such provisions are deceptive… because a warrantor cannot, as a matter of law, avoid liability under a written warranty where a defect is unrelated to the use by a consumer of “unauthorized” articles or service.
 
In addition, warranty language that implies to a consumer acting reasonably in the circumstances that warranty coverage requires the consumer’s purchase of an article or service identified by brand, trade or corporate name is similarly deceptive. For example, a provision in the warranty such as, “use only an authorized ‘ABC’ dealer” or “use only ‘ABC’ replacement parts,” is prohibited where the service or parts are not provided free of charge pursuant to the warranty."
 
You can read more at the FTC website here.

 

Personally I am happy to see this long over-due change. This change is effective immediately.

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Excellent news, both for the car owner and independent shops.  Some dealers have been scaring the Hell out of car owners about their warranty for years over parts sourcing and who is "authorized" to work on one of their cars.

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coming from the insurance industry (no hate mail please...) this is great news for me

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