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Extended warranties on domestic electrical goods

Date of reference: 2 July 2002

Action before reference

The OFT carried out a market study into the extended warranties on domestic electrical goods.

Reasons for reference

The OFT has referred the market for the supply of extended warranties on domestic electrical goods to the Competition Commission (CC) for investigation. The OFT found that competition in the market did not appear to be working effectively and that consumers were not adequately informed or protected.  Extended warranties typically can add around 50 per cent to the cost of an electrical good. Most extended warranties are sold by the large multiple electrical retailers.

The Competition Commission had 12 months to report to the Secretary of State on:

  • whether, and in whose favour, a 'monopoly situation' exists in the sector
  • whether that situation is being exploited or maintained
  • whether any facts found during the investigation operate, or may be expected to operate, against the public interest and, if so,
  • any remedies which it considers would address these detriments.

Key documents




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