Editorial

Limits to squeezing of 'lemon law'

The Consumers Association of Singapore has stepped in the right direction by examining the feasibility of obliging manufacturers to give warranties for all goods sold here. This proposed expansion of the "lemon law", to go beyond retailers and include manufacturers, would be both logical and fair. After all, defects in products are the shared, if not the primary, responsibility of manufacturers. They have a duty not to dump defective goods on unwary markets, while retailers must not pass on to customers such goods, which are known colloquially as "lemons". Customers would benefit even more than they do now should a new lemon law come into operation, enhancing the scope of the Consumer Protection (Fair Trading) Act and the Hire Purchase Act.

Retailers, too, would gain. At the moment, they are liable to customers who complain of faulty products, while they are held up in ad hoc and often tortuous negotiations with manufacturers. Were a new law to come into effect, it would circumvent the need for such arduous processes. Instead, compulsory warranties from manufacturers could take the form of private agreements between them and retailers, obliging manufacturers to chip in to repair or replace bad goods, or compensate sellers. Indeed, the new law would only make compulsory what is customary now with durables such as refrigerators and washing machines, where the manufacturer's warranty insures the customer against malfunction for a stipulated period. The principle of liability should be the same, whether the product is a high-end one or a casual one such as commonplace IT accessories.

In practice, how retailers divide their responsibilities with manufacturers should be left to them to devise, within the template of a general agreement that could be varied to reflect the particular nature of the goods in question. Accountability and transparency matter to customers, and a new law could well achieve these goals if it is parsed well enough. The authorities, who have no vested interest in the matter, could weigh in to ensure that the amended law is fair to all parties concerned.

One problem is that manufacturers outside Singapore might opt to not sell their products here if they find enhanced lemon law requirements prohibitive. Singapore is too small a market to make such a choice a punitive one. Of course, it is possible also that more reputable foreign manufacturers would remain engaged in the Singapore market in order to maintain their global profile. Overall, however, consumers here could face a reduced range of goods, particularly at the lower end, if any amendments are framed too strictly. Hence, a nuanced approach is called for, so that ordinary consumers do not lose out.