Online retailer's 'reseller only' claims rejected

By Liz Tay on Mar 15, 2010 11:22 AM
Filed under Sales & Marketing

Mwave forced to amend warranty policy.

Online computer store Mwave has been forced to amend its website and warranty policy following a court-enforceable undertaking by the Australian Competition and Consumer Commission (ACCC).

Mwave had previously told customers that it was a "reseller only", and was not responsible for providing warranty or any shipping costs associated with replacing faulty items.

"We realise that it is not your fault if a product is defective, but please understand it is not our fault if a product is defective - we ship what our distributors and manufacturers provide us with," the company previously stated on its website.

According to the ACCC, Mwave's claims were in breach of the Trade Practices Act 1974, because it contained misleading and false information about consumers' rights.

The Act grants consumers the ability to request a refund rather than replacement for a defective item, and the right to seek remedy from a retailer, without having to deal directly with the manufacturer.

"Consumers have the same rights online as if they were to walk into a store," ACCC chairman Graeme Samuel said.

"Basically, they can expect that a product would have a level of quality and performance that would be reasonable to expect, do what it is meant to do and match its description."

The undertaking required that remedies be initiated by Victor Lee and Wilson Zhang, directors of Esel Pty Ltd, which traded as Mwave.

Lee and Zhang were to publish a corrective notice on Mwave's website, establish a complaints handling process, and inform customers who had purchased items after 1 July 2007 of their right to seek damages.

Mwave also agreed to establish a Trade Practices Compliance Program that would be overseen by a compliance officer who would be appointed by the company.

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