PB Technologies has pleaded guilty to 14 charges of failing in its extended warranty agreements.
The Fair Trading Act charges were laid by the Commerce Commission of New Zealand, and related to extended warranty agreements sold to consumers and businesses between 11 May and 30 November 2017.
In a statement released yesterday, the Commerce Commission noted “businesses must give customers information about benefits provided by the extended warranty in addition to benefits already provided by the Consumer Guarantees Act.
“This information helps customers to decide whether they need an extended warranty and whether the benefits it provides are worth the price they are being asked the pay.
“The charges alleged that PB Tech failed to give its customers a summary comparing their existing Consumer Guarantees Act rights with the rights provided by the extended warranty.
According to the Commerce Commission, customers were not given a copy of the extended warranty agreement after paying for it, and were not told their cancellation rights before signing up.
The Commission is unable to comment further about this case while it is before the court, though sentencing will take place in September.
PB Tech was also warned about another potential breach of the Fair Trading Act, when it promoted a special Apple watch price to about 100,000 people when it only had 14 available.
Commissioner Anna Rawlings notes that businesses should not promote sought-after goods to attract customers unless those goods are available in reasonable quantities, or the limited amount is disclosed as part of the sale.
“PB Tech admitted that it knew the watches would sell out and two complaints told us that they sold out in the first few minutes of the sale,” says Commissioner Anna Rawlings.
“Any limitations to stock availability must by made prominently so consumers can make an informed purchasing decision.
“If there are only a small number of goods available, it is best practice for businesses to clearly state precisely what that number is,” said Rawlings.
