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European Commission Unveils Proposals to Reform Product Safety Regime

14 February 2013

LONDON, 14 February 2013 - The European Commission has published its long-awaited proposals for reform of the General Product Safety Directive (2001/95/EC) ("GPSD"), which applies to consumer products that are not covered by specific sector legislation. The new proposals also seek to strengthen market surveillance concerning all non-food products, including those imported from third countries.

Reform of the GPSD has been actively discussed for over three years.  Once adopted by the European Parliament and by the Council, the new measures will be enforced by the national market surveillance authorities in the Member States of the EU. The European Commission considers that improvements in relation to identification and traceability, which would be introduced by the new proposals, will help take unsafe products out of the market quickly.  In addition, the national market surveillance authorities in the Member States will benefit from strengthened cooperation and enhanced tools to carry out surveillance and enforcement activity.

Rod Freeman, a partner at Hogan Lovells specialising in product liability and product regulatory matters, said of the new proposals:

"While the introduction of the new GPSD in 2001 was a revolutionary step in the regulation of product safety, these latest developments are more of an evolutionary nature, building on the steps that have been taken to develop the European regulatory regime over the past decade. 

"Having said that, these new measures will have some important practical implications for those who manufacture, distribute or sell products.  For example, they include significant new labelling and documentation obligations, and the prospect of greater scrutiny and regulatory intervention when unsafe products are placed on the market

"Clearly, the changes will result in additional costs for businesses and, to some degree, greater risks in the event that unexpected problems arise.  However, to the extent that these changes introduce greater predictability, certainty and expertise among the authorities, they are very positive steps for all stakeholders.  It is also in the interests of all legitimate stakeholders that there be good product safety regulations, properly and appropriately enforced, to ensure that consumers and markets are protected from rogues who are prepared to take short cuts when it comes to compliance.  Reducing the ability for rogue businesses to trade creates a more level playing field, and reduces unfair competition."

The new measures should go some way to achieving the elimination of 'unfair competition from dishonest or criminal rogue operators', one of the considerations behind the Commission's proposals for reform.

Key features of the proposals

The following features are among those of most importance to product manufacturers and suppliers:

  • A new focus on obligations to ensure traceability of consumer products generally, including new obligations to label country of origin on products
  • A new explicit obligation to label products with a type, batch or serial number, and enhanced obligations to label products with contact details of the manufacturer and the importer
  • Clarification that the scope of the new legislation includes products to which consumers will be exposed in the course of a service being provided (this is not clear under the current GPSD)
  • New obligations on manufacturers to prepare and retain technical documentation, including a documented risk assessment
  • More explicit obligations on parties in the supply chain to take responsibility for the safety of products they are handling, and expanded obligations to notify the authorities about product risks
  • New express provision that penalties for breach should be calculated having regard to the size of the business
  • Scope of market surveillance provisions to cover products presenting risks to the environment and public security as well as health and safety generally
  • More explicit, and expanded obligations on national authorities to exchange information on product risks, including obligations to share information with authorities outside the EU, even if information is confidential to the business
  • More explicit and expanded obligations on national authorities to proactively investigate the safety of products
  • Zero tolerance for "formal" breaches of labelling and documentation requirements
  • More explicit powers for national authorities to require manufacturers, importers and distributors to undertake recalls, and for the authorities to carry out recalls and other activities at the expense of the business

Two new regulations

The European Commission has proposed that the current GPSD be replaced by a new regulation on consumer product safety, the General Product Safety Regulation ("GPSR"), which will be directly applicable and enforceable in every Member State of the EU.  It will include most of the key product safety measures already contained in the GPSD insofar as they impose obligations on manufacturers and distributors, while the GPSR will also be broader in scope in some respects than the GPSD, and will provide some additional, and more onerous, obligations.

To the extent that the GPSD deals with aspects of market surveillance by the enforcement authorities, it is proposed that those measures will be incorporated into a new regulation on market surveillance of products, the Market Surveillance of Products Regulation ("MSPR").  In comparison with the current regime, the MSPR will enhance the obligations imposed on the enforcement authorities and, in some respects, on manufacturers, distributors and retailers.

Further information regarding the new proposals can be found at: http://ec.europa.eu/consumers/safety/psmsp/

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