Understanding the difference between a legal and a commercial guarantee can be quite complex for consumers. This is especially so when consumers buy products which sellers claim are not covered by a guarantee or when buying goods with different guarantee periods.
A legal guarantee is a statutory right that gives consumers the option to seek redress from sellers when a product turns out to be faulty or not in conformity with the contract of sale. These legal rights always apply regardless the type of product purchased.
On the other hand, a commercial guarantee is given out voluntarily by the trader or manufacturer and is expected to give consumers better rights and protection in case of damages or defects. The commercial guarantee is an additional protection and can never replace or diminish consumers’ legal rights.
An important difference between these two guarantees is their duration. While the timeframe of the legal guarantee is fixed to two years, the length of a commercial guarantee may vary from seller to seller and may also depend on the brand or type of product offered for sale.
Other differences are in the terms and conditions of use. When claiming a remedy under the legal guarantee, consumers are in the first instance entitled to a free repair or replacement. When these two remedies are not possible, or if opted for may cause consumers significant inconvenience, consumers may then request a part or full refund of the money paid for the product.
While these three remedies may be listed in the terms and conditions of commercial guarantees, there may be different rules how the remedies can be claimed by consumers. There are also commercial guarantees that do not offer replacement or refund but only the possibility to repair the defective product at no cost.
However, while the two-year legal guarantee is valid, consumers may opt for the legal remedies if these are more advantageous to them. Once the two-year legal protection expires, then the terms and conditions of the commercial guarantee strictly apply.
Another important difference between legal and commercial guarantees is that while the former automatically applies as soon as the sale is concluded, and the only documentation consumers require is the proof of purchase, commercial guarantees must be provided in a durable format.
The length of a commercial guarantee may vary- Odette Vella
This requirement is specified in the Consumer Affairs Act, which also lists the information that must be included in the terms and conditions of commercial guarantees.
In the first instance, a commercial guarantee must be written in English or Maltese; must specify the name and address of the person or company responsible for the guarantee; must clearly state the guarantee duration; the procedure to be followed by the consumer to claim a remedy; and also a clear description of the goods to which the guarantee applies.
Commercial guarantees should also indicate whether the guarantee can be transferred to others. If in the terms and conditions there is nothing that prohibits such a transfer, then it may also be availed of by any subsequent owners of the goods to which the guarantee refers.
A further distinction between the commercial and the legal guarantee is while the latter entitles consumers to a free-of- charge remedy, the execution of the commercial guarantee may entail costs for consumers, but only as long as these costs are clearly written in the guarantee’s terms and conditions.
However, even when these additional costs are specifically mentioned in the guarantee’s document, consumers must not be charged any fees if the product’s defect is still covered by the two-year legal protection.
A commercial guarantee may also include a number of responsibilities that consumers need to follow to benefit from the guarantee. Consumers must read, understand and observe these conditions. It is also the consumers’ responsibility to ensure they do not lose the guarantee’s documents and the proof of purchase, especially if these are required to execute the guarantee.
Consumers must also take care of the product purchased as instructed by the seller or manufacturer, and any problems should be reported to the original seller and not involve a third party.
Even though commercial guarantees are given out voluntarily by traders, once given they become legally binding. Furthermore, consumer legislation states that a commercial guarantee is also mandatory on the trader if mentioned in a statement or advertisement, even if the commercial guarantee is not specifically mentioned in the contract of sale.
Should consumers encounter situations where a commercial guarantee is not honoured, or traders try to impose additional costs before providing a remedy, consumers may seek the assistance of the Office for Consumer Affairs.
www.mccaa.org.mt