The Federal Trade Commission is considering dropping its requirement that retailers prominently display warranties or signs indicating where warranties can be found by consumers before they buy a product.
Warranties still would have to be provided by retailers if a shopper requested them, but would not have to be conspicuously displayed as now required.
Under the present FTC rule, which has been in effect since 1976, retailers have to make copies of warranties available for any product they sell on which the manufacturer offers a warranty.
Retailers must place the warranty on the product package, post copies of the warranty on signs near the product, or display warranties in a loose-leaf binder in the store for consumers to read. Most stores that comply with the present warranty rule keep binders containing warranties, but FTC spokesman Neal Friedman said an agency survey found that few people actually look for them.
The FTC staff has proposed changing the rules so that if warranties do not accompany products, they will be supplied only on the request of the consumer. The proposed change, the agency said, might reduce the regulatory burden on storeowners while allowing consumers who want the warranties to get them. Retailer compliance with the current rule is spotty, the FTC said.
Retailers support the FTC proposal. "We don't find that the current requirement to display warranties is beneficial to consumers, and it is a needless cost to the retailer," said Donald F. White, vice president of the American Retail Federation.
Opponents of the proposal said, however, that loosening the warranty display requirement would hurt the consumer. "What are the retailers going to do -- have the warranties with very fine print posted in the back alley?" asked Mark Silbergeld, director of the Washington office of Consumers Union.
"I can't believe displaying warranty information is a costly requirement for retailers unless the information is posted in platinum and gold in 40 places in the store," Silbergeld added. "The idea that this is costly is preposterous."
FTC officials agreed that the current regulation is not expensive for retailers, costing between $150 to $500 a year for each store in a chain. But FTC Commmissioner Patricia P. Bailey, who proposed changing the current rules, said the main objective is to give retailers more flexibility.
The FTC also approved a change in its warranty advertising guideline, easing the current requirement for what information must be included in ads.
The agency said current regulations, including the duration of the guarantee and a description of which part of the product is guaranteed, discourage advertisers from promoting their warranties because they require "so much information to be explained when warranties are mentioned" in an advertisement.
Bailey said the rule is "excessive and burdensome" and has deterred most warranty advertising.