FTC warns console and smartphone makers against limiting consumer warranties


The names of the companies have not been revealed, but they are "major companies that market and sell automobiles, cellular devices, and video gaming systems in the United States".

As PCGamer points out, the FTC's primary concern seems to be that companies are violating the Magnuson Moss Warranty Act, which is a law that protects consumer product warranties and prohibits certain restrictions.

There has also been an official statement by Thomas B. Pahl, Acting Director of the Federal Trade Commission, who said that tying warranty coverage with the use of particular products hurts both consumers, and small businesses, which want to be competitive with their services. In its letters, the agency provided three examples of what it deems to be "questionable provisions" found on different products.

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Hyundai USA now insists "the use of Hyundai Genuine Parts is required to keep your Hyundai manufacturer's warranties and any extended warranties intact", while Nintendo sees no problem voiding otherwise valid warranties if some of its gaming devices are "used with products not sold or licensed by Nintendo".

Nintendo's warranty states that "this warranty shall not apply if this product is used with products not sold or licensed by Nintendo".

If a company uses a seal or sticker that voids warranty if altered, defaced or removed, then that could be seen as an issue- unless that company provides free part replacements and repairs, or has cleared it with the FTC beforehand. TO BE CLEAR: It's not just the stickers that are illegal - it's any suggestion from any company saying consumers can not keep warrantys for products they've gotten fixed or worked on with non-original-brand parts or services.

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Apple in February ditched a warranty condition that excluded coverage on iPhones that had displays repaired or replaced by third-party providers.

The FTC has requested the companies review their warranty literature and warned that failure to update warranty information available online within 30 days could result in legal action. In addition, the FTC called for each company to revise its practices to comply with the law.

KitGuru Says: Warranty stickers are a nuisance but they are so common at this point that it would be hard to stop them from circulating. Now the FTC says these kinds of policies are illegal.

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