Express Warranties Explained: Australian Business Compliance Guide

Promises sell products. When you tell customers a phone lasts “up to 24 hours,” a roof coating is “UV‑resistant,” or your service is “backed by a 5‑year warranty,” you’re making an express warranty.

In Australia, those promises carry legal obligations under the Australian Consumer Law (ACL). Getting them right builds trust and reduces risk. Getting them wrong can lead to complaints, refunds, penalties and reputational damage.

In this guide, we break down what counts as an express warranty, how it interacts with the ACL’s non‑excludable consumer guarantees, what you can (and can’t) say in your marketing, and the practical steps to draft, display and manage compliant warranty terms in your business - including the exact situations where the ACL lets you limit liability and the mandatory wording for warranties against defects.

What Is An Express Warranty Under Australian Law?

An express warranty is any clear promise you make about your goods or services - whether spoken, written, in your advertising, on packaging or on your website. If a reasonable customer would understand it as a commitment about quality, performance, characteristics, lifespan or support, it’s likely an express warranty.

Common examples include:

• “Waterproof to 30 metres” on a smartwatch box.
• “Free from manufacturing defects for 2 years.”
• “On‑site response within 4 business hours.”
• “100% Australian‑made components.”
• “Lifetime support” for software or equipment.

Once you make an express warranty, you’re legally bound to honour it. If it’s inaccurate, unclear or not backed by a proper remedy process, you can be exposed to ACL claims and enforcement action.

Express Warranties, Consumer Guarantees And Warranties Against Defects: What’s The Difference?

These concepts often get mixed up. Here’s how they fit together - with the key ACL details many businesses overlook.

Consumer Guarantees (ACL)

Consumer guarantees are automatic, non‑excludable rights that apply whenever you supply goods or services to a “consumer.” For goods, this includes guarantees that they’re of acceptable quality, fit for purpose and match their description. For services, guarantees include due care and skill and that services are supplied within a reasonable time. You cannot opt out of these.

Who is a consumer? Under the ACL, a person (including a business) is a consumer if they acquire:

• goods or services priced at $100,000 or less; or
• goods or services of a kind ordinarily acquired for personal, domestic or household use or consumption (regardless of price); or
• a vehicle or trailer primarily used to transport goods on public roads.

There are important carve‑outs. A person is not a consumer for goods acquired for resupply, or to use up or transform in the course of production, manufacture, or in repairing or treating other goods or fixtures. These nuances matter, especially for B2B transactions.

Express Warranties

Express warranties are the extra promises you choose to make about your products or services. They sit alongside the consumer guarantees and cannot reduce or replace them. If your express promises go further than the ACL guarantees, you must deliver on them.

Warranties Against Defects

A warranty against defects is a document or statement that explains what you’ll do if goods or services are defective (for example, “we’ll repair or replace within 12 months”). If you offer one, the ACL prescribes mandatory wording and specific information you must include (such as your contact details, the period, how to make a claim and who bears expenses).

For goods, the mandatory text must begin with: “Our goods come with guarantees that cannot be excluded under the Australian Consumer Law…” and then set out entitlements for major failures and the repair/replace/refund remedies. For services, there is separate prescribed text that begins: “Our services come with guarantees that cannot be excluded under the Australian Consumer Law…”. If you supply both goods and services, a combined form of wording is required. The wording must appear exactly as prescribed by the ACL.

Using a compliant Warranties Against Defects Policy helps you meet these requirements and keeps messaging consistent across your business.

Put simply: consumer guarantees apply by law, express warranties are your additional promises, and warranties against defects are the formal documents that set out your defect remedies. All three can apply at the same time.

What Can You Say In Your Marketing? Avoid Misleading Warranty Claims

The ACL prohibits misleading or deceptive conduct and false or misleading representations. This applies to every express warranty you make in ads, sales conversations, social posts and packaging.

• Don’t over‑promise: If a claim is only true in limited conditions (“water‑resistant only when used with the supplied case”), say so clearly and prominently.
• Be specific: Vague phrases like “lifetime warranty” create risk. Is it the lifetime of the product, the original owner, or your brand? Spell it out.
• Substantiate: Keep evidence that supports performance claims (test reports, certifications, supplier statements). You may need it if challenged.
• Disclose exclusions: Reasonable wear and tear or misuse can be excluded, but exclusions must be clear, fair and not contradict the ACL.
• Train your team: Sales and support staff should know what they can promise and how to describe warranties accurately.

Your general conduct must not mislead (see the ACL rule on misleading or deceptive conduct) and you cannot make false representations about the existence or effect of a warranty or guarantee (the ACL’s rule on false or misleading representations).

Pricing plays a role too. If you link a “premium warranty” to a price claim, ensure you’re following Australia’s advertised price laws and that any comparisons or “was/now” statements are accurate.

How To Draft, Display And Manage Express Warranties (Step‑By‑Step)

You don’t need a 20‑page legal document to create a compliant express warranty. You do need clarity, consistency and a simple process your team can follow. Here’s a practical approach you can use across products and services.

1) Map Every Promise Across Your Customer Journey

List the statements you make about quality, lifespan, performance, support or remedies across:

• Product pages, packaging, labels and spec sheets.
• Sales scripts, quotes and proposals.
• Website FAQs, blog posts and social content.
• Onboarding emails and user guides.

This audit helps you spot inconsistencies and claims that need evidence or clarification. If you confirm features or terms by email, remember that emails can be legally binding, so make sure what’s written aligns with your warranty position.

2) Define The Scope, Duration And Remedies

For each warranty, set out in plain English:

• What’s covered: The characteristics or performance you promise (e.g. materials, workmanship, battery life within a specified range).
• How long: A defined period (e.g. 12 months from purchase) or a clear trigger (“until the first major service”). Be realistic - customers also have consumer guarantees that may extend beyond your chosen period.
• Remedies: Repair, replace, resupply or refund - and who decides. If you reserve the choice, say so.
• Conditions: Proper use, maintenance or installation requirements, with examples.
• Exclusions: Fair, reasonable exclusions (e.g. misuse, unauthorised modifications, consumables). Avoid exclusions that conflict with the ACL.

3) Include The Prescribed ACL Wording If It’s A Warranty Against Defects

If you issue a written warranty statement about what you’ll do if goods or services are defective, you must include the ACL’s mandatory text and key details - including your business name, address, phone and email; the warranty period; what’s covered; how to claim; and who pays any expenses. A compliant Warranties Against Defects Policy will cover these requirements and ensure the exact prescribed wording appears for goods, services, or both.

4) Put Your Warranty Where Customers Expect To See It

Placement matters. Make the warranty available before purchase and easy to find after purchase.

• On product pages and packaging (a concise summary with a link or QR code to full terms).
• In your sales documents and proposals, ideally incorporated into your Terms of Sale or Customer Contract.
• On your website, linked from relevant pages and your Website Terms of Use.
• In order confirmations and onboarding emails for services.

5) Keep Your Marketing, Contracts And Support Scripts In Sync

Misalignment is a common source of complaints. If your marketing says “two‑year performance warranty,” but your contract says “12 months on parts only,” you’ll have a problem.

Choose one plain‑English description and mirror it everywhere. Update your website, packaging, quotes and help centre at the same time, and have a single owner responsible for version control.

6) Set Up A Simple Claims Process

Make it easy for customers to contact you, lodge a claim and understand what happens next. At a minimum, set out:

• Where to submit a claim, with contact details and business hours.
• What information you need (proof of purchase, photos, serial numbers).
• Response timeframes and next steps (inspection, repair booking, replacement dispatch).
• Who pays shipping or call‑out fees (if any), noting ACL limits on passing costs to consumers.

Keep records of claims, decisions and any test results. This helps you identify product issues and defend your position if there’s a dispute.

7) Train Your Team And Your Suppliers

Give customer‑facing staff an easy script for common warranty questions and a clear escalation path. If you rely on distributors or installers, ensure they understand what they can promise, what’s included, and when to seek your approval.

Finally, revisit your warranty annually. If your products, suppliers or risk profile change, your warranty should evolve too.

Can You Limit Or Exclude Liability? What The ACL Actually Allows

You can’t contract out of the consumer guarantees (ACL s64). Any term that tries to do so is likely void and may attract penalties. However, the ACL does allow some reasonable limits in specific situations - particularly for business supplies - if you draft them carefully and transparently.

Using ACL s64A To Limit Remedies (When It’s Permitted)

Under s64A of the ACL, if the goods or services you supply are not of a kind ordinarily acquired for personal, domestic or household use or consumption, you may limit your liability for failure to comply with the consumer guarantees to one of the following:

• For goods: repair or replacement of the goods, or payment of the cost of repair or replacement; or
• For services: resupply of the services, or payment of the cost of resupply.

Two key points are often missed:

• The limitation must be expressly stated in your terms and be fair and reasonable in all the circumstances.
• This carve‑out does not apply to goods or services of a kind ordinarily acquired for personal, domestic or household use or consumption - for those, you cannot limit your remedies this way.

In practice, many B2B supplies fall into the s64A category, but not all. Assess each product or service line and draft your terms accordingly. If you’re unsure, it’s worth reviewing how limitation of liability clauses operate in Australian contracts.

Other Lawful Constraints (That Still Respect The ACL)

• Reasonable use conditions: You can require customers to follow maintenance schedules, use specified consumables, or avoid conditions that void the warranty (e.g. water damage or unauthorised modifications).
• Remedy choice: You can reserve the choice between repair, replacement, resupply or refund for non‑major failures (noting the ACL’s major vs minor failure rules).
• Consequential loss: You may limit or exclude liability for indirect or consequential loss where permitted, provided you don’t misrepresent or reduce consumer guarantees. Draft with care so these provisions don’t overreach.

If you use disclaimers, make sure they’re consistent with the ACL. A broad “no refunds” sign or blanket waiver will almost certainly mislead or be invalid, and even carefully drafted legal waivers won’t let you avoid the consumer guarantees. The safest approach is transparency: clearly explain what you promise, how customers can claim, and how your warranty works alongside ACL rights.

Key Documents To Support Warranty Compliance

Putting the right documents in place makes compliance simpler and reduces the risk of disputes. Most businesses will need a combination of the following:

• Customer Contract or Terms of Sale: Sets out your express warranty, remedies, claim process and any lawful limitations. For online stores, incorporate these terms into checkout and align them with your Website Terms of Use.
• Warranties Against Defects Policy: The formal document you provide with goods and/or services that explains defect remedies and includes the ACL’s mandatory wording and details. A consistent, compliant policy ensures the right message every time.
• Marketing and Claims Register: An internal record of performance and warranty claims made publicly, with links to supporting data and approvals.
• Supplier and Manufacturing Agreements: Back‑to‑back warranty and indemnity clauses with upstream suppliers so you’re not left carrying product risk alone.
• Staff Training Guide: Clear scripts and escalation rules for sales and support teams to avoid off‑the‑cuff promises.

For many businesses, aligning your Customer Contract or Terms of Sale with your packaging and marketing is the quickest way to reduce risk and prevent disputes.

Key Takeaways

• Express warranties are the clear promises you make about goods or services - once made, you must honour them.
• Consumer guarantees under the ACL apply automatically; you cannot exclude or reduce them. Businesses can be “consumers” too where the ACL definition is met.
• Warranties against defects require prescribed wording and key details - including different mandatory text for goods and for services - so be precise.
• Avoid risk by being specific, substantiating claims and keeping your marketing, contracts and support scripts consistent.
• ACL s64A allows limited remedies for certain B2B supplies (not ordinarily for personal/household use), but limitations must be fair, reasonable and clearly stated.
• Make claims handling easy and transparent, keep records, and train your staff and suppliers on what can (and can’t) be promised.
• Strong documents - like a Customer Contract, Terms of Sale, a compliant Warranties Against Defects Policy and Website Terms of Use - tie your compliance program together.

If you’d like a consultation on setting up compliant express warranties for your Australian business, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no‑obligations chat.