Italy Accuses Apple of Misrepresenting Warranty Options, Threatens to Kick It Out
Apple is facing fines of up to $377,500 and closure of its operations in Italy for failing to properly notify its customers of the free two-year warranty on products sold in the European Union.
The Lâ€™AutoritÃ Garante della Concorrenza e del Mercato (AGCM), Italy’s antitrust authority, on Monday gave Apple 30 days to clearly explain to customers that its products, like all goods and services purchased in the EU, are covered by the EU Statutory Warranty.
Earlier this year, Apple was taken to task by the AGCM for ignoring EU consumer protections and upselling its Italian customers into AppleCare extended warranties. That misstep cost Apple $1.2 million and a bit of public humiliation when it was forced to promote the AGCM’s ruling from the front page of Apple Store Italy via a “Communication to protect consumers” link.
But it continues to sell AppleCare Protection Plans in Italy to this day, though it does note — briefly and via hyperlink, the EU warranty while making its pitch.
Now, in the company’s defense, AppleCare is quite different from the EU Statutory Warranty. Importantly, it covers product defects that occur after a product is purchased; the EU warranty covers only defects that were present at purchase. It also guarantees the consumer access to Apple telephone technical support and, for some products, express replacement service — all for an additional fee.
In other words, the EU Statutory Warranty is a lemon law, and AppleCare is a “Cadillac” warranty plan. The two are very, very different beasts, and Apple clearly feels that it’s not misleading anyone by offering them the option of upgrading their warranty, just as it does everywhere else in the world. It’s worth noting that Italy seems to be the only EU member state complaining about this issue.
But that’s beside the point. With a threatened closure of its Italian operations in 30 days, the stakes are quite a bit higher for Apple this particular go-round. How will the company respond to the AGCM’s mandate this time?