Under federal law, car manufactures are prohibited from threatening to revoke vehicle warranties based on where a consumer chooses to have their vehicle fixed. Apparently, a division of BMW didn’t follow that rule and now must change its practices to resolve charges from federal regulators.

The Federal Trade Commission announced this week that BMW agreed to settle charges that its Mini division – which handles all Mini Cooper sales – violated provisions of the Magnuson-Moss Warranty Act by telling vehicle owners that the company would void their warranties unless they used Mini dealers and parts for repairs.

According to the FTC settlement [PDF], BMW told owners that in order to maintain a vehicle’s safe operation and value they must “have routine maintenance performed only by Mini dealers unless the representation is true and BMW can substantiate it with reliable scientific evidence.”

In order to resolve the charges, BMW must provide affected BMW Mini owners with information about their right to use third-party parts and service without voiding warranty coverage, unless the manufacturer offers the parts and services free of charge.

Additionally, the company is barred from representing that, to ensure a vehicle’s safe operation or maintain its value, owners must have routine maintenance performed only by Mini dealers or Mini centers, unless the representation is true and BMW can substantiate it with reliable scientific evidence.

A spokesperson for BMW tells The Detroit News that the company did not agree with the FTC’s claims but settled for the best interest of consumers.

BMW Settles FTC Charges that Its MINI Division Illegally Conditioned Warranty Coverage on Use of Its Parts and Service [Federal Trade Commission]

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