Lemon Law has been saving Americans from the devastation of unforeseen vehicle defects for decades. Federal law, the Magnuson-Moss Warranty Act, has protected consumers by holding manufacturers to their warranties and making sure those warranties are clear in nature and scope, since 1975. State Lemon Law varies by state but generally provide protections that go beyond the manufacturer’s warranty, including considerations for maximum time periods for repairs. But what does the rest of the world do? Does Lemon Law exist everywhere?
Canada
While it may not be called a “lemon law” in Canada, if you feel you’ve purchased a defective vehicle, there may still be some recourse.
For a new vehicle, if the manufacturer’s warranty fails, and the defect will not be covered, there is another option through the Canadian Motor Vehicle Arbitration Plan (CAMVAP). This program could result in a buyback or reimbursement. CAMVAP covers most leased or purchased vehicles in Canada. It’s important to note that vehicles purchased in the United States will not be covered under CAMVAP unless the manufacturer agrees to arbitration under this process.
For used vehicles or misrepresentation during the process of purchasing a vehicle from a Canadian auto dealer, you’d need to contact the Consumer Affairs office in your province or territory.
For more information on arbitration and other frequently asked lemon law questions, click here.
European Union
The European Union doesn’t have lemon laws, per say, but the EU Consumer Sales and Guarantees Directive was put in place in 1999. This directive formed a framework for consumer protections across member states. With a two-year warranty on vehicles and other goods, an understanding that a defect arising within the first six months is presumed to have existed at the time of delivery, and possible requests for repair, replacement, or a refund, this directive is similar to our state-side Lemon Laws.
While this directive has set National minimum standards in place, individual European Union member states may differ in the details.
Australia
As with many countries, even with protections in place, issues between manufacturers and consumers persist. The Trade Practices Act (TPA) and the Australian Consumer Laws (ACL) may protect small businesses and consumers from unfair contract terms or transactions between consumers and corporations, but due to continued and frequent complains to the Australian Competition & Consumer Commission (ACCC), a lobby group called Lemon Laws 4 Aus was founded. Their goal is to strengthen consumer guarantees and provide better definitions of “acceptable quality” under the TPA, leading to better, more consistent protections for Australian consumers.
Brazil
While the Consumer Protection Code also has the goal of managing consumer relationships and providing protections, it goes on to regulate advertising as well. As with many of the above-mentioned laws and acts, the Consumer Protection Code in Brazil is considered to provide “guidelines” for consumer interactions.
China
Just this year (2024), a decree of the State Council was signed, further regulating the execution of consumer protections and rights. These regulations touch on business owner obligations, transparency of costs, factual guarantees, and protections for personal information. On the opposite side, the decree also states that consumers will not take advantage of these rules and make undo requests or infringe on the rights of business owners. This decree went into effect earlier this month (July).
The main different between Lemon Law in the United States and abroad is that here, we treat it as its own entity and, elsewhere, its often grouped into broader consumer protections. Just like in the states, the details vary from state to state or territory to territory.
In fact, in 2019, The Center for Auto Safety put out a ranked list of where state Lemon Laws provide the best protections and where they are the worst. At the bottom of the barrel, we find Colorado at 50 and Illinois at 51. These states achieved these impressively low ranks due to a provision that allows manufactures to seek attorney’s fees from consumers and no penalties for manufacturer bad faith, respectively. Ranked at the top of the list, Washington comes in at number two and New Jersey at number one. Washington allows for recovery of attorney fees and damages while New Jersey achieved its high score with the time period and number of repair attempts that qualify a vehicle as a lemon.
Texas comes in nineth on this list with four unsuccessful repair attempts, two unsuccessful repair attempts, the vehicle is out of service for 30 days within the shorter or 24 months or 24,000 miles from purchase.
Besides Lemon Laws, there was one additional item of note listed on the Center for Auto Safety website: Secret Warranties. Auto companies may call them by a different name (good will programs, extended warranties, etc) but think about when a large recall is addressed. Hundreds of thousands of dealerships and owners need to be notified. With these “secret warranties”, auto manufacturers communicate the defect adjustment policy to only regional offices, often not making it all the way to dealers much less owners. In 1988, a whistleblower noted 41 secret warranties at Toyota. What does this mean for the average consumer?
Secret Warranty laws do not yet exist so unfortunately, you’ll only know whether you’re covered by a secret warranty by doing some detective work. The first step is to check for a technical service bulletin. These are published by manufacturers to help the dealership with diagnosing and repairing issues that may arise. The verbiage isn’t often clear but you’d be looking specifically for trigger words like “check for availability of good will assistance”. For more details, you’ll want to review this article.
Once you know you’re eligible, you’ll want to take it with you to the dealership when you take your vehicle in for repairs. Even if the secret warranty isn’t addressed directly, you may still receive repairs at no expense due to the wording on the service bulletin. If this doesn’t work, you’ll want to address the claim with the manufacturer directly. Dealerships may not even be in the know about these secret warranties, but the manufacturer will know.