The Federal Trade Commission (FTC) has with effect from July 21, 2021 unanimously adopted a Policy Statement to combat practices that the agency refers as “repair restrictions” for consumer devices and other products.
In light of the view that constraining consumers by imposing repair restrictions leads to substantial increase in the total cost of repairs, generate harmful electronic waste, and unnecessarily increase wait times for repairs. Hence, combating restrictions provide more choices in repairs which can lead to lower costs, reduce e-waste, enable more timely repairs, and provide economic opportunities for entrepreneurs and local businesses.
Therefore, FTC has adopted the Policy Statement, wherein it will inspect the manufacturers’ policies that impact consumer product repair options and prioritize an enforcement approach against limitations that it believes to be unlawful.
The Policy Statement identifies different types of repair-related policies that the FTC will scrutinize:
- The Policy Statement states that the FTC will efficiently scrutinise the consumer warranties for compliance with the Magnusson-Moss Warranty Act (MMWA). The FTC has previously sent out warning letters to companies regarding potential violations of the compliances, and taken one recent enforcement action.
- The Policy Statement states that the FTC will analyze repair restrictions for violations of antitrust laws and take measures against it.
- The Policy Statement states that the FTC will investigate whether any practices constitute unfair or deceptive acts or practices under the FTC Act, including evaluating any claims made about repair limitations.
- The FTC will bring an interdisciplinary approach to this issue, using resources and expertise from throughout the agency to combat unlawful repair restrictions. The FTC will also closely coordinate with state law enforcement and policymakers to ensure compliance and to update existing law and regulation to advance the goal of open repair markets.
*Tanvi Singh, Editorial Assistant has reported this brief.