Another EU regulating Valve should know and so should every consumer: http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:31999L0044:EN:HTML
Especially Article 3 and 5
Article 3
Rights of the consumer
The seller shall be liable to the consumer for any lack of conformity which exists at the time the goods were delivered.
In the case of a lack of conformity, the consumer shall be entitled to have the goods brought into conformity free of charge by repair or replacement, in accordance with paragraph 3, or to have an appropriate reduction made in the price or the contract rescinded with regard to those goods, in accordance with paragraphs 5 and 6.
In the first place, the consumer may require the seller to repair the goods or he may require the seller to replace them, in either case free of charge, unless this is impossible or disproportionate.
A remedy shall be deemed to be disproportionate if it imposes costs on the seller which, in comparison with the alternative remedy, are unreasonable, taking into account:
the value the goods would have if there were no lack of conformity,
the significance of the lack of conformity, and
whether the alternative remedy could be completed without significant inconvenience to the consumer.
Any repair or replacement shall be completed within a reasonable time and without any significant inconvenience to the consumer, taking account of the nature of the goods and the purpose for which the consumer required the goods.
The terms "free of charge" in paragraphs 2 and 3 refer to the necessary costs incurred to bring the goods into conformity, particularly the cost of postage, labour and materials.
The consumer may require an appropriate reduction of the price or have the contract rescinded:
if the consumer is entitled to neither repair nor replacement, or
if the seller has not completed the remedy within a reasonable time, or
if the seller has not completed the remedy without significant inconvenience to the consumer.