STAND. COM. REP. NO. 1531

Honolulu, Hawaii

RE: H.B. No. 68

H.D. 1

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirtieth State Legislature

Regular Session of 2019

State of Hawaii

Sir:

Your Committee on Commerce, Consumer Protection, and Health, to which was referred H.B. No. 68, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO CONSUMER PROTECTION,"

begs leave to report as follows:

The purpose and intent of this measure is to prohibit a merchant in the State from adopting a warranty policy that requires a purchaser to pay an additional fee to obtain a repair, replacement, or refund for goods returned pursuant to the warranty.

Your Committee received testimony in support of this measure from the Department of Commerce and Consumer Protection. Your Committee received testimony in opposition to this measure from the Retail Merchants of Hawaii.

Your Committee finds that some merchants charge consumers a "warranty processing fee" even when a warranted product is being returned because of a manufacturer's defect. Your Committee further finds that shifting the cost to process a return, replacement, or refund for a defective product onto a consumer is inappropriate, as these fees should be borne by the merchant. Accordingly, this measure prohibits a merchant in the State from collecting fees or making a consumer pay to obtain a repair, replacement, or refund for goods returned pursuant to a manufacturer's warranty.

Your Committee has amended this measure by:

(1) Inserting an effective date of July 1, 2019; and

(2) Making technical, nonsubstantive amendments for the purposes of clarity and consistency.

As affirmed by the record of votes of the members of your Committee on Commerce, Consumer Protection, and Health that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 68, H.D. 1, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 68, H.D. 1, S.D. 1, and be placed on the calendar for Third Reading.

Respectfully submitted on behalf of the members of the Committee on Commerce, Consumer Protection, and Health,

________________________________

ROSALYN H. BAKER, Chair