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FTC warns about illegal warranties, likely including Nintendo and Sony

Federal Trade Commission states that companies are not allowed to force users to use specific service providers

Nintendo and Sony are believed to be among the six major companies that have received warning letters from the Federal Trade Commission.

In a statement released earlier this week, the FTC announced it has issued letters to half a dozen firms marketing and selling video games systems, as well as automoblies and cellular devices.

The warnings express concerns about warranty policies that state consumers "must use specified parts or service providers" in order to ensure their products are still covered. The FTC declares that these are generally prohibited by law - specifically the Magnuson-Moss Warranty Act.

In the statement it offers three exampes of "questionable provisions", although notes that each company uses different language:

  • The use of [company name] parts is required to keep your . . . manufacturer's warranties and any extended warranties intact
  • This warranty shall not apply if this product . . . is used with products not sold or licensed by [company name]
  • This warranty does not apply if this product . . . has had the warranty seal on the [product] altered, defaced, or removed

Ars Technica points out that Nintendo's warranty is almost word-for-word the same as the second example, while Sony's is very similar to the third.

If Nintendo and Sony are among the companies contacted, they have 30 days to review the phrasing in their warranty policies. Failure to comply "may result in law enforcement action."

"Provisions that tie warranty coverage to the use of particular products or services harm both consumers who pay more for them as well as the small businesses who offer competing products and services," said Thomas B. Pahl, acting director of the FTC's Bureau of Consumer Protection.

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