Apple Inc. (NASDAQ:AAPL) has reached an agreement with the Australian Competition and Consumer Commission (ACCC) settling allegations that Apple Store employees had misled consumers about their rights under the Australian Consumer Law (ACL) regarding refunds and replacements, reports Helen Davidson for The Guardian.
The ACCC said that Apple was telling customers about its own policies, including a 14-day return policy and 12-month warranty, which is different from what people can expect under the ACL, which was passed in 2011. “The ACL consumer guarantees have no set expiry date. The guarantees apply for the amount of time that it is reasonable to expect given the cost and quality of the item or any representations made about the item,” said ACCC chairman Rod Sims.
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Apple says its employees may have violated ACL
Apple Inc. (NASDAQ:AAPL) admits that its employees may have violated the ACL by telling customers that they weren’t obligated to repair or refund merchandise, or by sending away customers who had bought third-party items from the Apple Store, incorrectly telling them that complaints had to be taken to the manufacturer. Apple Inc. (NASDAQ:AAPL) has agreed to a two-year program meant to improve ACL compliance, including additional training for much of the company’s Australian retail staff. The company will also address any claims from customers within the last two years and provide refunds or other compensation as appropriate.
IT’s jurisdictional grey area doesn’t extend to retail
What may be most interesting about this case is how the tech industry ethos has gotten Apple Inc. (NASDAQ:AAPL)’s retail arm into trouble. The issue of jurisdiction is a thorny one for the IT sector, whether its accusations that Amazon is evading taxes in the UK or Google failing to bring its privacy policies in line with EU regulations. If tech companies whose services can be accessed anywhere in the world have to comply with laws passed anywhere in the world, simply doing business becomes a logistical nightmare.
Part of the strength of Apple Inc. (NASDAQ:AAPL)’s brand is the tight control it has over its ecosystem of gadgets and apps, and the company has strived to maintain a high, consistent level of service for customers (and has been rewarded with incredible brand loyalty). But unlike the App Store, which can be accessed practically anywhere but Apple can reasonably argue is only governed by US law, there’s no question of jurisdiction for an Apple Store operating in Australia. The level of uniformity that Apple Inc. (NASDAQ:AAPL) strives for in its tech business probably isn’t realistic for retail.