From 17 June, some of the guarantees that your goods and services must meet under the Consumer Guarantees Act (CGA) are changing. Your business also needs to follow new laws if you sell extended warranties.
Three changes to the Consumer Guarantees Act may affect your business from 17 June 2014:
All sales of goods and services to consumers will be covered by the Consumer Guarantees Act, including those made through auctions, competitive tenders or online bidding using websites like Trade Me.
See Consumer Guarantees Act (external link) on the Consumer Protection website for more information.
You must make sure any goods you send or deliver yourself to a consumer arrive in acceptable condition and on time. This means you will be liable to the consumer where goods arrive damaged, late or fail to arrive at all – even when the carrier caused the problem.
These changes increase your liability to consumers. You can help prepare for the changes by:
From 17 June, there is a new acceptable quality guarantee in the Consumer Guarantees Act that specifically applies to the supply of electricity or gas. This is the only CGA goods guarantee that electricity or gas suppliers must meet from this date. But you must continue to comply with service guarantees in the Act.
From 17 June 2014, when you offer a consumer an extended warranty, you must comply with new Fair Trading laws enforced by the Commerce Commission.
Customers will have the right to cancel a warranty within 5 working days of receiving it. You must tell consumers about:
You will also need to make sure your agreements include certain information on their front page and disclose all the terms and conditions of the agreement.
See Consumer Protection's Warranties (external link) page for more information.
If you don’t comply with the new laws for selling extended warranties, the consumer can cancel the agreement at any time and have the right to a full refund. You will also be in breach of the Fair Trading Act, and may be prosecuted or served with an infringement notice by the Commerce Commission.