Extended Warranty Insurance - Law 2694

Law No 2694 provides that “Any company or business that sells non-consumable goods and that offers a warranty that exceeds the term established in Sections 11 and 16 of the Consumers’ Protection Law, commonly called ‘extended warranty’, must inform consumers of its terms, the type of contract to be executed, the company entering into the contract, and the actual date of inception of the warranty, by means of a notice board easily visible to the public”.

The “extended warranty” referred to in Law No 2694 is that exceeds the term established in the Consumers’ Protection Law No 24,240 (“CPL”). The CPL provides that the minimum term for the legal warranty in the case of used non-consumable goods is 3 months, and in the case of new non-consumable goods is 6 months.

The final Section 1 of Law No 2694 provides that any company or business that offers an “extended warranty” with the sale of a non-consumable good must inform consumers, by means of a notice board easily visible to the public, the following: (i) the terms of the warranty; (ii) the type of contract to be executed; (iii) the company entering into the contract; and (iv) the actual date of inception of the warranty. This notice shall also include the following: “The Extended Warranty is an insurance contract entered into by the consumer with a company other than that where the product is purchased”.

The procedure provided for by the Administrative Procedural Law No 757 of the City of Buenos Aires (“Law 757”) shall apply. Section 3 of Law 757 establishes that: “In case of presumed violations, within the jurisdiction of the City of Buenos Aires, of the provisions of this Law, of the Consumers’ Protection Law (24,240) and of Law No 22,802, and its implementing regulations, the enforcement authority shall start administrative proceedings ex-officio or as a result of a report made by any individual or entity with a particular interest or acting in protection of the general interest of consumers”. 

Once the violation has been verified, fines provided for in the CPL and in Law No 22,802, its amendments and any other provisions in force, shall apply.

The CPL establishes the following sanctions which may be applied, jointly or independently, according to the circumstances of each case: (i) warning; (ii) fine ranging from AR$ 100 to AR$ 5,000,000; (iii) confiscation of the goods and products object of the violation; (iv) closure of the premises or suspension of the service for a term not exceeding 30 days; (v) suspension for up to 5 years in the registries of the State suppliers; and (vi) the loss of concessions, privileges, tax or special credit regimes. In all cases, the text of the resolution imposing the sanction must be published in the newspaper of the jurisdiction where the violation was committed, at the offender’s expense. Additionally, the enforcement authority shall assess the existence of a direct damage to the consumer and oblige the supplier of the service to indemnify the consumer for a sum not exceeding an amount regularly published by the National Institute of Statistics and Census of the Republic of Argentina (INDEC).

Law No 22,802 establishes a fine ranging from AR$ 100 to AR$ 500,000, applicable to any individual or entity that violates its provisions.