Which term describes a written offer to solve problems provide services or sell products?

• Businesses must meet a set of basic rights when they sell products or services.
• These basic rights are called consumer guarantees. They are included in the Australian Consumer Law.
• Consumers automatically receive these consumer guarantees when they buy goods and services.
• It is unlawful for businesses to mislead consumers about these rights.

What the ACCC does

• We educate businesses and consumers about their rights and obligations under the consumer guarantees.
• We can investigate and may take some form of compliance or enforcement action if a business misleads consumers about their consumer guarantee rights.

What the ACCC can't do

• We don’t provide legal advice about what consumers are entitled to, or what businesses need to do in a particular situation.
• We don’t resolve individual disputes about whether the consumer guarantees have been met, or individual disputes about a remedy.

Consumers have the right to expect certain things when they buy a product or service. These rights are protected under consumer law.

In consumer law, these basic rights are called consumer guarantees.

Businesses can’t take away consumers’ rights

The basic rights covered by consumer guarantees can’t be taken away by anything a business says or does.

For example, a business can’t take away these basic rights by:

• displaying a ‘no refunds’ sign, or otherwise saying that refunds are not available at all, or not available at all after a certain number of days
• saying they aren’t responsible for problems with a product or service
• suggesting the consumer must sign an extended warranty to avoid losing these basic rights after a certain date.

It is against the law for businesses to mislead consumers about their rights in these ways.

Consumer rights are different to warranties

Consumer guarantees are not the same as warranties, including extended warranties.

Consumer guarantees are automatic and can’t be taken away. Warranties are extra promises that a business can choose to make on top of the consumer guarantees.

See Warranties for more information.

Personal or household use

Products and services that are normally bought for personal or household use are covered by consumer guarantees.

Business use

A business can be a consumer too. Products and services bought for business use are covered by consumer guarantees, if:

• they cost less than $100,000 including GST
• they are not bought to be re-sold or used in production or manufacturing.

Business vehicles and trailers are covered by consumer guarantees if they are used mainly to transport goods on public roads, no matter what they cost.

Example of when consumer guarantees apply

A dental practice buys a portable air conditioner for use in the practice for $500. The air conditioner is less than $100,000 and is not being re-sold by the practice or being used up in the course of the practice’s business. So it is covered by the consumer guarantees.

Example of when consumer guarantees don't apply

A farmer buys grain from a supplier to feed the cattle on his small farm. The shipment of grain costs $20,000. He will then sell the cattle once it reaches a certain age.

While the grain costs less than $100,000, it is being used up in the course of the farmer’s business, and so it's not covered by the consumer guarantees.

Gifts

Consumers who receive a product or service as a gift are entitled to the same basic rights as if they had bought the product or service themselves.

Exceptions and special rules

There are some exceptions and special rules where consumer guarantees don’t apply to certain types of goods and services, or apply in a different way, or different laws apply:

• hiring or leasing a product
• bundled products and services
• private sales, where the seller isn’t running a business
• auctions
• products from overseas businesses
• products and services bought before 2011
• financial products
• services to transport or store business goods
• engineering and architect services.

Read more about the exceptions and special rules.

When buying a product, a consumer has the right to expect the following things.

Acceptable quality

A product sold to a consumer must be of acceptable quality.

Acceptable quality means the product:

• is safe, durable and free from defects
• has an acceptable appearance and finish
• does everything that similar products are commonly used for.

There are no set rules for deciding whether a product is of acceptable quality, or how long a product should last for. To decide whether a product meets this expectation, consider questions like:

• What kind of product is it, and how does it compare to similar products?
• What is it made of and how was it made, and how does this compare to similar products?
• How much did it cost, and how does it compare to products of a similar price?
• What maintenance may be needed to keep the product operating?
• Did the business or manufacturer make any claims about quality, or how long the product could last for?
• Did the business warn the consumer about any defects, or warn against the product’s use in a certain manner?
• How old is the product, and how long do similar products normally last?
• Was the product sold new or second-hand?
• Has the product been used in a way it wasn’t designed for?

For more information and help in deciding whether a product may meet the ‘durable’ or ‘safe’ parts of the consumer guarantee of acceptable quality, the following guides explain these things in more detail, including examples.

• Guidance on the consumer guarantee as to acceptable quality and ‘durability’
• Guidance on the consumer guarantee as to acceptable quality and ‘safe’

Example

A consumer buys a new pair of shoes. One of the shoes loses a heel when it's worn for the first time.

The consumer can claim that the shoe doesn’t meet the guarantee of acceptable quality.

Fit for a particular purpose

This guarantee applies when:

• a consumer tells a business they want to use a product for a particular purpose
• the consumer buys the product based on the advice of the business
• the business advertises in any way that the product can be used for a particular purpose.

In any of these situations, the product that the business sells must be fit for the particular purpose stated.

This guarantee does not apply:

• if it’s unreasonable for the consumer to rely on the skill or judgement of the business
• if the business tells the consumer the product won’t meet their purpose, but the consumer buys the product anyway.

Example

A consumer buys paint from a specialty paint shop after explaining to the business that they’re painting their outdoor decking. After a couple of months, the paint begins to peel, as it’s unsuitable for outdoor surfaces.

The consumer can claim that the paint isn’t fit for a particular purpose that was made known to the business.

Matches description

Any description of a product by a business must be accurate, whether written or spoken.

Example

A consumer orders a set of pink towels online based on the colour chart supplied by the business. The towels delivered are red.

The consumer can claim that the towels don’t match the description by the business.

Matches sample or demonstration model

If a consumer buys a product based on a sample or demonstration model, the product must have the same quality and features.

Example

A courier test rides a new motorcycle for their business. They agree to buy a motorcycle the same as the demonstration model. When the new motorcycle is delivered, it has a smaller engine than the demonstration model.

The courier can claim the motorcycle doesn’t match the demonstration model.

Extra promises

If a business or manufacturer makes extra promises about the quality, condition, performance or characteristics of a product, they must meet these promises. This applies whether the promises are spoken or written.

These extra promises are legally known as express warranties.

Example

A consumer buys a kitchen knife. The business promises that it will stay sharp for 10 years. After 5 years, the knife is no longer sharp.

The consumer can claim that the knife doesn’t meet the express warranty.

Repairs and spare parts

When a consumer buys a product, the manufacturer or importer must provide spare parts and repair facilities for a reasonable time after purchase. This applies even if the consumer did not buy the goods directly from the manufacturer or importer.

This guarantee does not apply if the consumer is told at the time of purchase that repair facilities and spare parts will not be available after a certain time.

Title to the product, undisturbed possession, no hidden debts or charges

These 3 consumer guarantees are closely related. When a consumer buys a product, they have a right to expect that:

• they have full ownership of the product
• nobody will try to reclaim or repossess the product
• the previous owner doesn’t owe money for the product.

If any of these aren’t true, the business must tell the consumer before they buy the product.

When buying a service, a consumer has the right to expect the following things.

Due care and skill

Service providers must carry out all services using an acceptable level of care and skill. Their work must be at least as good as what a competent service provider with average skills and experience would provide. They must also take reasonable steps to avoid causing loss or damage when providing the service.

Example

A consumer hires a plumber to fix a leak in the bathroom. The next day, the same leak returns.

The consumer can claim that the service wasn’t provided with due care and skill.

Fit for a particular purpose

Services provided, and any resulting products, must be fit for any stated purpose.

This guarantee applies when:

• a consumer tells a service provider they want to use their service for a particular purpose
• the consumer buys the service based on the advice of the business
• the service provider advertises that their service can be used for a particular purpose.

This guarantee doesn’t apply to professional services provided by a qualified architect or engineer.

Example

A consumer hires a carpenter to build a unit that will fit their 50-inch television. The finished product is too small.

The consumer can claim that the service didn’t meet the purpose specified.

Provided within a reasonable time

Services must be supplied within a reasonable time, if there’s no agreed time frame.

What is 'reasonable' can depend on factors including:

• the nature of the services
• weather conditions
• availability of parts or materials.

Example

A consumer hires a builder to repair an outdoor patio. The consumer and the builder don't discuss the completion date. The builder starts the repairs but doesn’t return for a month.

The consumer can claim that the service hasn’t been supplied within a reasonable time.

However, if it was raining during that time, the delay might be reasonable.

Hiring or leasing

Most of the consumer guarantees apply when a consumer hires or leases a product, rather than buying it outright.

However, consumers don’t own products they hire or lease, so the consumer guarantees related to ownership (title to the product and no hidden debts or charges) do not apply to hiring or leasing products.

The consumer guarantee of undisturbed possession does apply, but only for the length of the hire or lease agreement.

Bundled products and services

Businesses sometimes sell products and services together as a package, for example a mobile phone on a service contract. Sometimes a problem may only be with the product or service part of the package.

There are rules for how returning the product part of the package affects the service part of the package, and for how cancelling the service affects your rights to the product. Read these guides for more information.

Private sales

Most consumer guarantees don’t apply to one-off sales between 2 people, where the seller isn’t running a business. Examples include sales at a garage sale or fete, or individuals selling through online marketplaces like Gumtree or Facebook Marketplace.

However, the following consumer guarantees do apply to these private sales:

• title to the product
• undisturbed possession
• no hidden debts or charges.

Auctions

Most consumer guarantees don’t apply to products sold at a traditional auction – that is, an auction run by an agent of the person selling the goods.

However, the following consumer guarantees do apply to traditional auctions:

• title to the product
• undisturbed possession
• no hidden debts or charges.

The law against false or misleading claims also applies to traditional auctions.

For online auctions, see Buying and selling online for more information.

Products from overseas businesses

When an overseas business sells products directly to consumers in Australia, the business must follow the Australian Consumer Law, including the consumer guarantees.

In practice it can be difficult to get a repair, replacement or refund from an overseas business if there’s a problem with the product or service, and the help Australian consumer protection agencies can provide is limited.

If you can’t resolve a problem with an overseas business, you should ask the consumer protection agency where the seller is based if it can help you.

Consumers aren’t covered by the Australian Consumer Law if the business doesn’t officially offer their products and services in Australia. For example, if the consumer has the business send the product to an overseas address, and the consumer then arranges for someone else to forward or bring the product to Australia.

Products and services bought before 2011

Products and services bought before 1 January 2011 aren’t covered by the current Australian Consumer Law. They may be covered by older laws.

If you have a problem with a product bought before 1 January 2011, read Warranties and refunds guide. This guide is relevant to goods and services bought before 1 January 2011, when the current law was introduced.

Financial products

Consumer guarantees in the Australian Consumer Law don’t apply to financial products such as insurance, as these are covered by other laws.

Services to transport or store business goods

Services to transport or store goods for business purposes are notcovered by consumer guarantees.

Engineering and architect services

The fit for purpose consumer guarantee doesn’t apply to professional services provided by a qualified architect or engineer.

Read our guides

If you still need help deciding whether a basic right has been met, read these guides. They include more examples and case studies.

Related information

Guidance on the consumer guarantee as to acceptable quality and ‘durability’

Guidance on the consumer guarantee as to acceptable quality and ‘safe’

Consumer vulnerability - A business guide to the Australian Consumer Law

Complaints and problems

Repair, replace, refund, cancel

What is a written offer to solve problems provide services or sell products?

What section of a proposal discusses how you will solve the problem?

What is the difference between formal and informal proposals?

What is the purpose of an informal business proposal?