UK: General Product Safety Directive Implications for the Technology Sector

Last Updated: 21 July 2004
Article by Pauline Munro and Mo Bhaskaran

Originally published July 2004

The statutory regime regulating product liability for goods sold to consumers is about to be stepped up and companies will need to be rigorous in their safety, quality and audit procedures.

Driving this is the harmonisation of product liability laws across Europe through the revision of the General Product Safety Directive (GPSD). The new law will extend the obligations of producers and distributors in relation to product safety. It is currently subject to a consultation process led by the DTI.

Who will this affect?

This major overhaul will affect every manufacturer and distributor, throughout the supply chain, where the goods are ultimately supplied to consumers, which in the technology sector will include:

  • computers, computer equipment, games consoles, mobile phones and other palm technology manufactured and supplied directly to consumers
  • products which are ultimately offered for rent or sale to consumers, although they were originally intended for use in a professional environment
  • products which are supplied to or used by consumers as part of a service.

What are the implications?

As with the existing General Product Safety Regulations, failure to meet obligations in the new GPSD will expose businesses to penalties at the hands of public authorities. Penalties will be 'effective, proportionate and dissuasive'. The current expectation is that penalties will be significant, not least because if the local authority becomes the enforcer, the cost of its involvement will be a factor.

The administrative costs to all businesses of complying with the new GPSD are likely to be unwelcome. Far greater, though, will be the financial and reputational costs of non-compliance.

What is the current situation?

Product safety and liability is currently governed by a number of domestic, sector-based voluntary and European provisions, most notably the 1994 General Product Safety Directive. This stipulates that producers and distributors are liable for the safety of parts they supply, regardless of whether that part is produced by themselves or someone else, or whether it is new or reconditioned. Producers and distributors have to monitor the safety of the components and products they sell and distributors must make information on safety risks available to the manufacturer of the part, where the manufacturer requests it.

Current European law prioritises increased consumer protection and seeks to provide a harmonised approach. Both trends will intensify as the new GPSD is introduced.

What changes with the new GPSD?

The new regulations reflect the steady shift away from regulation between individuals, to regulation by the state. As is currently the case, the enforcement authority is likely to be your local authority, but far greater obligations will be placed on manufacturers and distributors.

There is a definition of what is meant by a safe product with a presumption that products that comply with European standards are safe. However where there is evidence that, despite conformity with such standards, a product is still dangerous, action can be taken to impose restrictions on the product being placed on the market or to require its recall.

Example - mobile phone manufacturers and distributors will need to continue to monitor ongoing research into the health effects of electro-magnetic fields and will also need to consider growing concerns about risks such as repetitive strain injuries from text messaging. RSI will also be of concern to manufacturers and suppliers of both computer games consoles and new products like the Blackberry mobile phone/e-mail messager. Games console makers already provide warnings to consumers of certain risks, such as to users' eyesight (and to those susceptible to seizures) of spending long continuous periods in front of a screen.

The key provisions of the new GPSD

  • Producers and distributors are obliged to inform the relevant authorities when a product in the market is potentially dangerous and the action being taken to prevent further risks to consumers. They must initiate a product recall if other measures are insufficient to protect consumers.
  • Manufacturers and distributors are required to inform the authorities if they become aware that they have put a defective or dangerous part into circulation and advise of steps taken to avert the risk.
  • Notification will require standard information which has yet to be finalised.
  • Distributors (within the limits of their activities) will also have an obligation to monitor safety of products and will be required to maintain detailed traceability information for all products they supply or fit.
  • Producers will be obliged to take steps to enable them to be informed of the risks products might pose. This includes taking steps such as batch marking products, regular testing and auditing of product safety and maintaining a register of customer complaints.
  • Most radical of all, enforcement authorities will be able to order and, if necessary, organise product recalls, where all other methods of protection appear to them to be inadequate and both producers and distributors will have a positive duty to co-operate with the authorities.
  • Finally there is also, for the first time, provision for the European Commission to suspend a product without a member state's request.
  • The emergency ban provision where the European Commission can ban a product outright if it is considered to be dangerous has been extended from three months to one year. The legislation will also stipulate that products which are the subject of an emergency ban cannot be exported to third countries.

There is provision to challenge any decision taken by the authorities to recall a product, and subject to the seriousness of the risk, parties subjected to recall measures will have the opportunity to submit their views prior to enforcement of a recall by the authorities.

How should you prepare?

  • Check the terms of your insurance cover to ensure it covers the costs of complying with the new regime.
  • If you don't have one already, start to keep a register of customer complaints. If you do have one, ensure that it is rigorously monitored and sufficiently detailed.
  • Ensure that you keep an audit trail of the components you supply (or fit), including product identification and origin.
  • Make sure you have robust test systems to continually assess the safety of the products or components you supply. You also need systems in place to keep up to date with current knowledge from ongoing research into risks from products.
  • Check to ensure that the producer of the parts you fit or distribute is able to give you access to its customer complaints register and audit trail.

Alongside changes specifically required to comply with the legislation, ensure that you are satisfied that your company is sufficiently up-to-date with the following:

  • terms and conditions of sale and purchase - review these to ensure that you are not exposed to unnecessary risk.
  • insurance cover- product recall insurance is often separate to standard product liability insurance.
  • crisis plan - have an effective plan in place to be implemented in the event of a product defect or recall covering everything from notifying insurers to PR and customer communications.
  • customer complaints - monitoring trends in complaints can often provide an early indication of an inherent product problem. This will enable you to comply fully with the new GPSD by taking preemptive action and informing the authorities of the issue, should one arise.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
In association with
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.