An extensive amendment to the Act on Consumer Protection and the Civil Code (“Amendment”) came into effect on 6 January 2023, which we have addressed under a separate Alert: Amendment to Act on Consumer Protection and Civil Code and Impact Thereof ‒ General Overview. Herein, we are going to focus on changes introduced by the Amendment in relation to liability for defects and guarantee.
What are the changes:
- Changes in rights under defective performance
- Claim hierarchy in claim proceedings
- Quality guarantee
In more detail
A. Changes in rights under defective performance
The Amendment extends the scope of requirements imposed upon goods for which the seller is responsible in the case of the sale of tangible movable goods to consumer. Goods are newly required to have the usual properties of an item of the same kind as may be expected by a purchaser, including the shelf life of the goods. The seller will also be responsible for goods being supplied with accessories, including the user manual, as may be reasonably expected by the purchaser. Special obligations apply when selling an item inter-connected with digital content or a digital service (for example, in relation to the provision of updates).
The period of time during which it is presumed that such goods purchased by a consumer were already defective upon receipt (referred to as the presumption of defectiveness) is extended from six months to one year. However, unlike the current regulation, consumers will only be able to raise a claim if the goods were already defective when they were taken over and not if the defect occurred later. Such a defect will only be possible to claim within 24 months from the receipt of the goods. Thus, after one year from the date of receipt, a claim can only be successful if the consumer manages to prove that the goods were already defective upon receipt, for example by means of an expert report.
B. Claim hierarchy in claim proceedings
The Amendment introduces a new and better organized hierarchy of individual claims of a purchaser if a defect in an item sold to consumer is claimed. If an item is defective, the purchaser may essentially only elect to have the item repaired, or to be supplied with a new item free of defects. If the defect cannot be removed or occurs repeatedly or if the defect substantially breaches the contract or it is clear from the circumstances that it will not be removed within a reasonable period of time or without significant difficulties for the purchaser, the purchaser may demand an adequate discount from the purchase price or may withdraw from the contract. A contract cannot be withdrawn from only if the defect is insignificant, provided that the negligible nature of the defect must be proven by the seller in such a case.
C. Quality guarantee
A guarantee for quality is newly defined as a voluntary unilateral legal act of the guarantee provider, whereby the provider undertakes to provide certain performance to a purchaser in case the subject of performance does not have the properties specified in the Guarantee Declaration. A guarantee for quality may only be provided in addition to the statutory rights of a purchaser under defective performance. With respect to a guarantee, the Amendment also stipulates the conditions for a change in the guarantee (consequently, it will newly be necessary to pay increased attention to guarantee declarations made in advertisements, for example, because such a guarantee will only be possible to change in an advertisement, or in a contract as such).
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In conclusion, please note that the above changes will require an update of any business terms and conditions, claim procedure rules and related procedures to make them compliant with the new legal regulation, which took effect on 6 January 2023. We will be happy to provide the necessary legal advice should you wish to find out how the Amendment will influence your company or to amend your documents.
Please do not hesitate to refer to us with any queries.