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Review of statutory warranties and conditions.



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THE HON CHRIS BOWEN MP Assistant Treasurer and Minister for Competition Policy and Consumer Affairs

NO.014

REVIEW OF STATUTORY WARRANTIES AND CONDITIONS

Consumer Affairs Minister Chris Bowen MP today announced a review of statutory implied conditions and warranties by the Commonwealth Consumer Affairs Advisory Council (CCAAC). The announcement was made in a speech to the National Consumer Congress.

"The Government is committed to delivering, for all Australian consumers, the best warranty protection for the sale of goods and services," Mr Bowen said.

"Consumers have been denied the full benefit of implied conditions and warranties for too long, as many are unaware of their rights and obligations in consumer transactions.

"Some businesses have attempted to take advantage of consumers' lack of awareness by denying their rights and/or selling them extended warranty protections that, in many cases, the law already offers."

The review is to examine the adequacy of existing laws on conditions and warranties implied into contracts for goods or services under the Trade Practices Act 1974 and state and territory fair trading legislation, and propose enhancements, where necessary.

The review will also examine the need for a 'lemon law' in Australia and whether or not they would provide an effective mechanism for consumers to seek the appropriate redress when purchasing motor vehicles that fail to meet their reasonable expectations.

"This review will explore the issue of whether or not 'lemon laws' are the best way to help consumers respond to motor vehicles they may have purchased, that repeatedly fail to meet expected standards of performance and quality.

"That's why I have asked CCAAC to carefully examine the costs and benefits of introducing 'lemon laws', the experience of other jurisdictions that already have these laws in place, and to consult closely with the key stakeholders."

Matters to be examined by CCAAC as part of this review include:

z the adequacy of the current laws on implied conditions and warranties;

z the need for any amendments to the current laws on implied conditions and

Media Release of 12/03/2009

Page 1 of 2 Press Release - Review of Statutory Warranties and Conditions [12/03/2009]

warranties and, if so, how those amendments would improve existing lawsand better empower regulators to ensure compliance with those laws;

z the need for 'lemon laws' in Australia to protect consumers who purchase goods that

repeatedly fail to meet expected standards of performance and quality, specifically in relation to motor vehicles;

z the existence of extended warranties in the market place and their interaction with

laws on implied conditions and warranties; and

z other means for improving the operation of existing statutory conditions and

warranties in Australia.

CCAAC is to undertake targeted consultations with relevant industry stakeholders, and provide a report to the Minister by 31 July 2009.

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