Minimum Requirements of the Mechanism
Source: 40 FR 60215, Dec. 31, 1975, unless otherwise noted.
(2) Any undertaking in writing in connection with the sale by a supplier of a consumer product to refund, repair, replace, or take other remedial action with respect to such product in the event that such product fails to meet the specifications set forth in the undertaking, which written affirmation, promise or undertaking becomes part of the basis of the bargain between a supplier and a buyer for purposes other than resale of such product.
(e) Mechanism means an informal dispute settlement procedure which is incorporated into the terms of a written warranty to which any provision of Title I of the Act applies, as provided in section 110 of the Act.
(g) Consumer means a buyer (other than for purposes of resale) of any consumer product, any person to whom such product is transferred during the duration of a written warranty applicable to the product, and any other person who is entitled by the terms of such warranty or under applicable state law to enforce against the warrantor the obligations of the warranty.
(2) If the warranty is included as part of a longer document, such as a use and care manual, the page in such document on which the warranty text begins.
(b) The warrantor shall disclose clearly and conspicuously at least the following information on the face of the written warranty:
(2) The name and address of the Mechanism, or the name and a telephone number of the Mechanism which consumers may use without charge;
(3) A statement of any requirement that the consumer resort to the Mechanism before exercising rights or seeking remedies created by Title I of the Act; together with the disclosure that if a consumer chooses to seek redress by pursuing rights and remedies not created by Title I of the Act, resort to the Mechanism would not be required by any provision of the Act; and
(4) A statement, if applicable, indicating where further information on the Mechanism can be found in materials accompanying the product, as provided in Sec. 703.2(c) of this section.
(2) The name and address of the Mechanism;
(3) A brief description of Mechanism procedures;
(4) The time limits adhered to by the Mechanism; and
(5) The types of information which the Mechanism may require for prompt resolution of warranty disputes.
(e) Whenever a dispute is submitted directly to the warrantor, the warrantor shall, within a reasonable time, decide whether, and to what extent, it will satisfy the consumer, and inform the consumer of its decision. In its notification to the consumer of its decision, the warrantor shall include the information required in Sec. 703.2 (b) and (c) of this section.
(f) The warrantor shall:
(2) Upon notification of any decision of the Mechanism that would require action on the part of the warrantor, immediately notify the Mechanism whether, and to what extent, warrantor will abide by the decision; and
(3) Perform any obligations it has agreed to.
(h) The warrantor shall comply with any reasonable requirements imposed by the Mechanism to fairly and expeditiously resolve warranty disputes.
(b) The warrantor and the sponsor of the Mechanism (if other than the warrantor) shall take all steps necessary to ensure that the Mechanism, and its members and staff, are sufficiently insulated from the warrantor and the sponsor, so that the decisions of the members and the performance of the staff are not influenced by either the warrantor or the sponsor. Necessary steps shall include, at a minimum, committing funds in advance, basing personnel decisions solely on merit, and not assigning conflicting warrantor or sponsor duties to Mechanism staff persons.
(c) The Mechanism shall impose any other reasonable requirements necessary to ensure that the members and staff act fairly and expeditiously in each dispute.
(2) A person who is or may become a party in any legal action, including but not limited to class actions, relating to the product or complaint in dispute, or an employee or agent of such person other than for purposes of deciding disputes. For purposes of this paragraph (a) a person shall not be considered a ``party'' solely because he or she acquires or owns an interest in a party solely for investment, and the acquisition or ownership of an interest which is offered to the general public shall be prima facie evidence of its acquisition or ownership solely for investment.
(c) Members shall be persons interested in the fair and expeditious settlement of consumer disputes.
(b) Upon notification of a dispute, the Mechanism shall immediately inform both the warrantor and the consumer of receipt of the dispute.
(c) The Mechanism shall investigate, gather and organize all information necessary for a fair and expeditious decision in each dispute. When any evidence gathered by or submitted to the Mechanism raises issues relating to the number of repair attempts, the length of repair periods, the possibility of unreasonable use of the product, or any other issues relevant in light of Title I of the Act (or rules thereunder), including issues relating to consequential damages, or any other remedy under the Act (or rules thereunder), the Mechanism shall investigate these issues. When information which will or may be used in the decision, submitted by one party, or a consultant under Sec. 703.4(b) of this part, or any other source tends to contradict facts submitted by the other party, the Mechanism shall clearly, accurately, and completely disclose to both parties the contradictory information (and its source) and shall provide both parties an opportunity to explain or rebut the information and to submit additional materials. The Mechanism shall not require any information not reasonably necessary to decide the dispute.
(d) If the dispute has not been settled, the Mechanism shall, as expeditiously as possible but at least within 40 days of notification of the dispute, except as provided in paragraph (e) of this section:
(2) Disclose to the warrantor its decision and the reasons therefore;
(3) If the decision would require action on the part of the warrantor, determine whether, and to what extent, warrantor will abide by its decision; and
(4) Disclose to the consumer its decision, the reasons therefore, warrantor's intended actions (if the decision would require action on the part of the warrantor), and the information described in paragraph (g) of this section. For purposes of paragraph (d) of this section a dispute shall be deemed settled when the Mechanism has ascertained from the consumer that:
(2) For a 7 day period in those cases where the consumer has made no attempt to seek redress directly from the warrantor.
(2) Prior to agreement the Mechanism fully discloses to the consumer the following information:
(ii) That the members will decide the dispute whether or not an oral presentation is made;
(iii) The proposed date, time and place for the presentation; and
(iv) A brief description of what will occur at the presentation including, if applicable, parties' rights to bring witnesses and/or counsel; and
(2) The Mechanism's decision is admissible in evidence as provided in section 110(a)(3) of the Act; and,
(i) A requirement that a consumer resort to the Mechanism prior to commencement of an action under section 110(d) of the Act shall be satisfied 40 days after notification to the Mechanism of the dispute or when the Mechanism completes all of its duties under paragraph (d) of this section, whichever occurs sooner. Except that, if the Mechanism delays performance of its paragraph (d) of this section duties as allowed by paragraph (e) of this section, the requirement that the consumer initially resort to the mechanism shall not be satisfied until the period of delay allowed by paragraph (e) of this section has ended.
(j) Decisions of the Mechanism shall not be legally binding on any person. However, the warrantor shall act in good faith, as provided in Sec. 703.2(g) of this part. In any civil action arising out of a warranty obligation and relating to a matter considered by the Mechanism, any decision of the Mechanism shall be admissible in evidence, as provided in section 110(a)(3) of the Act.
(3) Brand name and model number of the product involved;
(4) The date of receipt of the dispute and the date of disclosure to the consumer of the decision;
(5) All letters or other written documents submitted by either party;
(6) All other evidence collected by the Mechanism relating to the dispute, including summaries of relevant and material portions of telephone calls and meetings between the Mechanism and any other person (including consultants described in Sec. 703.4(b) of this part);
(7) A summary of any relevant and material information presented by either party at an oral presentation;
(8) The decision of the members including information as to date, time and place of meeting, and the identity of members voting; or information on any other resolution;
(9) A copy of the disclosure to the parties of the decision;
(10) A statement of the warrantor's intended action(s);
(11) Copies of follow-up letters (or summaries of relevant and material portions of follow-up telephone calls) to the consumer, and responses thereto; and
(12) Any other documents and communications (or summaries of relevant and material portions of oral communications) relating to the dispute.
(c) The Mechanism shall maintain an index for each warrantor as will show:
(2) All disputes in which the warrantor has refused to abide by a Mechanism decision.
(d) The Mechanism shall maintain an index as will show all disputes delayed beyond 40 days.
(e) The Mechanism shall compile semi-annually and maintain statistics which show the number and percent of disputes in each of the following categories:
(2) Resolved by staff of the Mechanism, time for compliance has occurred, and warrantor has not complied;
(3) Resolved by staff of the Mechanism and time for compliance has not yet occurred;
(4) Decided by members and warrantor has complied;
(5) Decided by members, time for compliance has occurred, and warrantor has not complied;
(6) Decided by members and time for compliance has not yet occurred;
(7) Decided by members adverse to the consumer;
(8) No jurisdiction;
(9) Decision delayed beyond 40 days under Sec. 703.5(e)(1) of this part;
(10) Decision delayed beyond 40 days under Sec. 703.5(e)(2) of this part;
(11) Decision delayed beyond 40 days for any other reason; and
(12) Pending decision.
(b) Each audit provided for in paragraph (a) of this section shall include at a minimum the following:
(2) Review of the indexes maintained pursuant to Sec. 703.6 (b), (c), and (d) of this part; and
(3) Analysis of a random sample of disputes handled by the Mechanism to determine the following:
(ii) Accuracy of the Mechanism's statistical compilations under Sec. 703.6(e) of this part. (For purposes of this subparagraph ``analysis'' shall include oral or written contact with the consumers involved in each of the disputes in the random sample.)
(d) Auditors shall be selected by the Mechanism. No auditor may be involved with the Mechanism as a warrantor, sponsor or member, or employee or agent thereof, other than for purposes of the audit.
(b) Except as provided under paragraphs (a) and (e) of this section, and paragraph (c) of Sec. 703.7 of this part, all records of the Mechanism may be kept confidential, or made available only on such terms and conditions, or in such form, as the Mechanism shall permit.
(c) The policy of the Mechanism with respect to records made available at the Mechanism's option shall be set out in the procedures under Sec. 703.5(a) of this part; the policy shall be applied uniformly to all requests for access to or copies of such records.
(d) Meetings of the members to hear and decide disputes shall be open to observers on reasonable and nondiscriminatory terms. The identity of the parties and products involved in disputes need not be disclosed at meetings.
(e) Upon request the Mechanism shall provide to either party to a dispute:
(2) Copies of any records relating to the dispute, at reasonable cost.