Lemon Law can boost consumer confidence, market integrity

SHAH ALAM – The government’s decision to expand the Lemon Law is being described as a landmark move in strengthening consumer protection, promoting market accountability and enhancing business integrity.

Economists noted that the measure, introduced under the 2026 Budget announced by Finance Minister Datuk Seri Anwar Ibrahim last Friday, would not only safeguard consumers from defective products but also signalled a broader effort to raise standards of corporate responsibility and fairness in trade.

Universiti Teknologi Mara Malaysian Academy of SME and Entrepreneurship Development coordinator of the Student Entrepreneurship Centre Dr Mohamad Idham Md Razak said the expansion was a progressive step in consumer rights reform.

He emphasised that Malaysians can expect stronger protection when purchasing goods, particularly vehicles, a sector often affected by disputes over product quality and warranty claims.

“The expansion of the Lemon Law is a progressive step that enhances consumer rights and promotes higher standards of business integrity.

“Malaysians can look forward to stronger protections when purchasing goods, particularly vehicles, fostering greater trust between consumers and sellers,” he said.

The Lemon Law, commonly implemented in several developed economies, defines a “lemon” as a product with a major defect that affects its use, value, or safety.

The law typically requires manufacturers or sellers to offer a replacement or refund after repeated failed repairs within a stipulated time frame.

Malaysia University of Science and Technology economist Professor Emeritus Dr Barjoyai Bardai said the Lemon Law typically applied to products with major defects that impair their use, value or safety and which cannot be repaired after a reasonable number of attempts.

“The specific number of repair attempts or time the product is out of service for repairs is often defined by the specific lemon law, whether it's a federal law in the United States or a state or national law elsewhere,” he added.

Meanwhile, economist Dr Geoffrey Williams noted that the expanded Lemon Law will likely compel sellers, especially in the automotive sector to provide full disclosure on vehicle condition and any past repairs.

“The lemon law is likely to require sellers to disclose the condition of the vehicles accurately and especially to point out any damage or repairs.

“It will likely provide a quick way to recover costs rather than going to court with penalties for misselling,” he said.

On Friday, the Finance Ministry officially tabled the 2026 Budget, marking the fourth budget under the Madani administration and the first under the 13th Malaysia Plan (2026–2030).