[Code of Federal Regulations]
[Title 16, Volume 1]
[Revised as of January 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 16CFR703.2]

[Page 536-537]
 
                     TITLE 16--COMMERCIAL PRACTICES
 
                   CHAPTER I--FEDERAL TRADE COMMISSION
 
PART 703--INFORMAL DISPUTE SETTLEMENT PROCEDURES--Table of Contents
 
Sec. 703.2  Duties of warrantor.

    (a) The warrantor shall not incorporate into the terms of a written 
warranty a Mechanism that fails to comply with the requirements 
contained in Secs. 703.3 through 703.8 of this part. This paragraph 
shall not prohibit a warrantor from incorporating into the terms of a 
written warranty the step-by-step procedure which the consumer should 
take in order to obtain performance of any obligation under the warranty 
as described in section 102(a)(7) of the Act and required by part 701 of 
this subchapter.
    (b) The warrantor shall disclose clearly and conspicuously at least 
the following information on the face of the written warranty:
    (1) A statement of the availability of the informal dispute 
settlement mechanism;
    (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.
    (c) The warrantor shall include in the written warranty or in a 
separate section of materials accompanying the product, the following 
information:
    (1) Either (i) a form addressed to the Mechanism containing spaces 
requesting the information which the Mechanism may require for prompt 
resolution of warranty disputes; or (ii) a telephone number of the 
Mechanism which consumers may use without charge;
    (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

[[Page 537]]

    (5) The types of information which the Mechanism may require for 
prompt resolution of warranty disputes.
    (d) The warrantor shall take steps reasonably calculated to make 
consumers aware of the Mechanism's existence at the time consumers 
experience warranty disputes. Nothing contained in paragraphs (b), (c), 
or (d) of this section shall limit the warrantor's option to encourage 
consumers to seek redress directly from the warrantor as long as the 
warrantor does not expressly require consumers to seek redress directly 
from the warrantor. The warrantor shall proceed fairly and expeditiously 
to attempt to resolve all disputes submitted directly to the warrantor.
    (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:
    (1) Respond fully and promptly to reasonable requests by the 
Mechanism for information relating to disputes;
    (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.
    (g) The warrantor shall act in good faith in determining whether, 
and to what extent, it will abide by a Mechanism decision.
    (h) The warrantor shall comply with any reasonable requirements 
imposed by the Mechanism to fairly and expeditiously resolve warranty 
disputes.

                  Minimum Requirements of the Mechanism