Harvey Norman Extended Warranty Providers face ACCC Court Enforceable Undertaking
The Australian Competition and Consumer Commission (ACCC) has accepted court enforceable undertakings from Domestic & General Services Pty Ltd (Domestic & General Services) and Yoogalu Pty Ltd (part of the Harvey Norman group of companies) following an industry-wide review of extended warranty selling practices.
The review followed a CHOICE shadow shop where 109 Harvey Norman, JB Hi-Fi and The Good Guys stores failed to acknowledge basic consumer law principles.
Domestic & General Services and Yoogalu will have to revise their brochures to include information on the existing remedies available under Australian Consumer Law (ACL) [contained in Sch 2 to the Competition and Consumer Act 2010 (Cth)], as well as provide retail staff with compliance training and monitor the practices of retailers selling extended warranties. According to the ACCC, the conduct of salespeople selling extended warranties was also called into question.
About the Service Providers
Domestic & General Services provides administrative, claims management and other services to retailers who sell extended warranties to consumers in conjunction with electronics, domestic appliances and white goods.
Yoogalu is a wholly owned subsidiary of Harvey Norman Holdings Limited. Yoogalu was involved in planning, designing and creating the extended warranty program sold at stores branded with the trade marks Harvey Norman®, Domayne® and Joyce Mayne®.
Compliance with the Undertakings
The undertakings require each of Domestic & General Services and Yoogalu to:
- engage with retailers to revise extended warranty brochures to include additional information to assist consumers in comparing the features of the extended warranty being sold with the existing remedies available under the ACL;
- provide ACL compliance training to those retailers; and
- develop and implement a program for monitoring retailers’ extended warranty selling practices, including by mystery shopping, and if necessary take action to improve those practices.
Domestic & General Services and Yoogalu cooperated with the ACCC by voluntarily offering these undertakings which follow similar measures agreed with Lumley and Virginia Surety Company Inc.
As a result of these four undertakings, all major Australian retailers who offer extended warranties to consumers of electronics, domestic appliances and white goods will receive compliance training and have their selling practices monitored.
Reaction from the ACCC
Speaking recently in an ACCC Media Release, ACCC Commissioner Sarah Court said:
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Harvey Norman extended warranty provider faces ACCC undertaking –
Yoogalu and Domestic & General Services give undertakings to ACCC –