Retailers attack European move towards two-year guarantees

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The Independent Online
New legislation proposed by Brussels to improve guarantees on consumer goods has been attacked by the Confederation of British Industry, the British Retail Consortium and the Consumers' Association as unwork- able, environmentally unsafe, and poorly thought out.

Ironically, the draft directive on consumer guarantees has been designed to encourage cross-border shopping. An EU review suggested one current impediment was the wildly differing standards of guarantees offered to consumers in different countries.

Italian retailers, for example, tend to offer only a one-month guarantee, whereas those in Germany offer six months. Belgium, Luxembourg and the Netherlands, however, have the highest standards, offering two years - double the one year offered by most British retailers.

The EU has always tended to harmonise up to the highest standards prevailing in the EU, rather than going for a norm, or levelling down.

But the UK, through the Sale of Goods Act, grants consumers much more stringent protection against unscrupulous manufacturers and stores than just the consumer guarantee. The Sale of Goods Act offers six years protection to consumers.

The Consumers' Association is particularly concerned that the new directive may weaken the existing legislation. Ashley Holmes, head of legal affairs, said: "My big concern is that the directive has to be implemented through parliament, and the result may be unintentional, but it could open the door to challenges to the Sale of Goods Act."

Mark Souhami, chairman of the British Retail Consortium, which represents the nation's high-street chains, is aghast at the proposals. "Like so many ideas emanating from Brussels, it seems like a good idea, but it contains a fatal flaw." He believes the main limitations on cross-border shopping are cultural and geographic.

His chief concern is the likelihood of a substantial increase in the number of returned goods - and the impact that may have on retailing margins. "But who will pay for that," he asks, "except the consumer?"

The directive covers all goods, from cars to dresses and household appliances to personal computers. It proposes that consumers, for the first year after they have purchased an item, would be able to return it to the shop if a fault emerges, and either have a free repair, replacement of the goods, or a price reduction. In the second year, they would be able to have the item repaired, free of charge, or a price reduction.

Kingfisher, the Superdrug to Woolworths stores group, believes the proposals are unworkable. A spokesman said: "If a zip goes at the end of two years, the customer is entitled to a free repair. The cost implications of this would be enormous. The mind boggles."

Mr Souhami says such a scenario is absurd. "It infers products can be made to standards which cannot be enforced." He says manufacturers do not try to make bad quality products, and that the length of the guarantee often reflects the price and quality of the item.

The CBI is about to embark on a lobbying campaign of MEPs to overturn the proposal.