Product Liability

The EU Product Liability Directive (85/374/EEC) (PLD) sets out an EU-wide no-fault liability regime to enable persons injured by a defective product to seek compensation from the producer of that product. As a directive, it has been implemented by EU member states and their national courts enforce the relevant implementing domestic laws in line with the directive. The PLD is the preferred way of making product liability claims in the European Union.

In addition to claims under the PLD, injured persons can bring product liability claims in the tort of negligence or in breach of contract under the national laws of member states.

Not at an EU level. Special regimes may apply at a national level under the laws of certain member states (eg, for pharmaceutical products).

Claims are brought in the national courts of member states and the outcome can be influenced by differences in national laws and civil procedure rules.

Yes. The Representative Actions Directive (EU) 2020/1828 (RAD) enables ‘qualified entities’ to bring representative actions in the European Union in the collective interests of consumers. Qualified entities can seek injunctions or redress, including compensation, for a breach of around 70 pieces of EU legislation, including:

• product liability;
• product safety;
• consumer rights; and
• data protection.

The RAD entered into force 24 December 2020 and the rules have applied in the European Union since 25 June 2023. As a directive, member states are required to transpose the requirements into national law.

The RAD distinguishes between two types of representative actions:

• those brought in one member state (domestic representative actions); and
• cross-border actions across multiple EU member states.

Under the RAD:

• member states must have at least one representative action procedure to allow representative actions at a domestic level by designated national qualified entities. Member states that have existing procedures may already meet these requirements, whilst others needed to introduce them. Member states can set their own criteria for qualified entities who can bring domestic actions, provided they are consistent with the objectives of the RAD; and
• member states must ensure that cross-border actions can be brought in their courts by qualified entities designated by other member states to bring cross-border actions. Member states can only designate qualified entities for the purposes of cross-border actions if they meet specified criteria, including that they:
• • demonstrate at least 12 months’ history of consumer protection;
  • have a non-profit character; and
  • be independent (among other things).

Member states can choose whether to provide for an opt-in or opt-out mechanism, or a combination of both. However, an opt-in mechanism will be required for cross-border representative actions.

A final decision on an infringement in one member state can be used as evidence in proceedings against the same trader for the same infringement in other member states.

The availability of a class action mechanism or other form of collective action is determined at a national level by the applicable laws and procedural rules of the member state in which the proceedings are issued.

Also see question 2.1 regarding representative actions.

Liability under the Product Liability Directive is imposed upon the ‘producer’ of the defective product. In summary, this will be:

• the person that manufactured the product;
• a person that holds themselves out as the producer by placing their name or trademark on the product;
• if the product was not manufactured in the European Union, the importer of the product into the European Union; or
• a supplier or distributor that fails to identify an entity within the above categories or disclose who supplied them with the product within a reasonable time after a request by the claimant.

These entities can be held jointly and severally liable and the claimant can choose to sue one or all of them.

Generally, for a claim based on breach of contract, the defendant will normally be the party that supplied the product to the end user (eg, the retailer).

This is determined by the national laws and procedure rules of member states.

See question 1.1.

The Product Liability Directive imposes civil liability and does not extend to criminal liability. However, criminal liability may be imposed under the national laws of member states that determine enforcement and penalties for breaches of product safety laws.

The Product Liability Directive (PLD) provides that a product is defective if it does not provide the level of safety that a person is entitled to expect, taking into account all relevant circumstances, including:

• the presentation of the product;
• the use to which it can reasonably be expected that the product will be put; and
• the time the product was put into circulation. A product is not defective for the sole reason that a better product is subsequently put into circulation.

The concept of ‘defect’ is an objective standard in relation to a consumer’s legal entitlement, rather than the actual expectations of the claimant or a notional group of consumers. There are no restrictions on the relevant circumstances that can be taken into account.

A product liability claim based on breach of contract under national laws of member states may relate to an express term and/or an implied term of the contract. Under the Sale of Goods Directive (EU) (2019/771) (SGD), various terms are implied into a contract for the sale of goods between a business and a consumer. For example:

• goods must be of the description, type, quantity and quality, and possess the functionality, compatibility, interoperability and other features, as required by the sales contract;
• goods must be fit for a particular purpose, if that purpose was made known and accepted by the seller before the contract was concluded;
• goods must be fit for the purposes for which goods of the same type would normally be used, taking into account existing EU and national law and technical standards; and
• goods must be of the quantity and possess the qualities and other features, including in relation to durability, functionality, compatibility and security normal for goods of the same type and which the consumer may reasonably expect given the nature of the goods and taking into account public statements made in advertising or labelling.

The claimant bears the burden of proving that the product is defective under the PLD. However, as the PLD establishes a strict liability regime, the injured person does not have to prove the negligence or fault of the producer.

In some circumstances where a product has failed unexpectedly and in a dangerous manner, the court might infer from those facts that, on the balance of probabilities, the failure was caused by a defect in the product under the PLD, even if a precise defect cannot be identified.

The relevant evidentiary standard is determined by the national laws of member states.

In respect of claims for breach of the statutory warranty under the SGD, there is a presumption to make it easier for consumers to bring claims: that any lack of conformity that becomes apparent within one year of the date of delivery of the goods is deemed to have existed at the time of delivery of the goods. The burden of proof rests on the seller to prove the contrary. Member states are given a discretion to extend this period to two years under national laws.

Under the PLD, the claimant also bears the burden of proving the causal link between the defect and the damage.

The relevant evidentiary standard is determined by the national laws of member states.

For claims under the PLD, the claimant needs to prove that:

• the product had a defect;
• he or she suffered injury; and
• the defect caused the injury.

The limitation period for claims under the Product Liability Directive (PLD) is three years from the earlier of the day on which the claimant either became aware or should reasonably have become aware of the damage, the defect and the identity of the producer. There is an overarching longstop under the PLD which provides that any right is extinguished 10 years from the date on which the producer put into circulation the actual product that caused the damage.

The limitation periods for claims in negligence and for breach of contract are determined by the national laws of member states. For claims under national legislation implementing the Sale of Goods Directive (SGD), this cannot be less than two years from the date of delivery. The SGD gives member states a discretion to require consumers to inform sellers of the lack of conformity within two months of detecting it, in order for consumers to benefit from their rights under the SGD.

There are various defences available in respect of claims brought under the PLD, including the following:

• The defendant did not put the product into circulation.
• Having regard to the circumstances, it is probable that the defect that caused the damage:
• • did not exist at the time when the defendant put the product into circulation; or
  • came into being afterwards.
• The defendant did not:
• • manufacture the product for sale or any form of distribution for economic purposes; or
  • manufacture or distribute the product in the course of its business.
• The defect is due to compliance with mandatory regulations issued by public authorities.
• The defect was not discoverable having regard to the state of scientific and technical knowledge at the time (known as the ‘development risks defence’). This defence has generally been narrowly construed by the courts, but nevertheless is often pleaded in product liability cases. A member state can derogate from the development risks defence under its national legislation.
• In the case of component manufacturers, the defect is attributable to the design of the product in which the component has been fitted or to the instructions given by manufacturer of the whole product.
• The product contains obvious and unavoidable risks. The labelling, instructions and warnings provided will be relevant in the court’s assessment of this defence.

For claims under the PLD, the damage can be reduced if the defendant can prove that the damage was partly due to the fault of the claimant.

Generally, it is not possible to exclude liability under the PLD.

There are also limitations on the ability to exclude liability under the SGD for consumer contracts.

It may be possible to limit certain types of liability under fault-based regimes, which are governed by national laws of member states.

However, liability risks can be managed to a degree by:

• making appropriate disclosures;
• giving adequate warnings; and
• obtaining relevant acknowledgements from the consumer.

There is much greater scope to limit or exclude product liability in business-to-business contracts, and in those cases it can be important for a product supplier to take care to ensure that the terms of sale are clear and adequate.

Product liability claims are brought in the national courts of member states. Each member state has its own court structure and civil procedure rules.

The Court of Justice of the European Union has jurisdiction as the final arbitrator on the interpretation of the Product Liability Directive and has handed down a number of important rulings.

This is determined by the applicable legal system and procedural rules of each member state.

Generally, juries are not used in product liability cases in the European Union.

Forum shopping between EU member states is expected to increase following the introduction of the Representative Actions Directive (RAD), which enables ‘qualified entities’ to bring representative actions in the European Union in the collective interests of consumers (see question 2.1 for further background).

For domestic representative actions, member states are largely free to set their own criteria for qualified entities that can bring domestic actions, provided that these are consistent with the objectives of the RAD. Member states can also choose whether domestic representative actions are opt-in or opt-out. This leaves it open for some member states to adopt different approaches. Under the RAD, a final decision on an infringement in one member state can be used as evidence in proceedings against the same trader for the same infringement in other member states. Member states with the most consumer-friendly approach are likely to become the forums of choice to bring an initial claim.

Product liability claims are brought in the national courts of member states. Each member state has its own civil procedure rules.

This is determined by the national laws and procedure rules of each member state.

The Recast Brussels Regulation (EU) 1215/2012 lays down rules to determine jurisdiction.

For cases falling outside the scope of the Recast Brussels Regulation, jurisdiction may be determined by the national laws applicable in the member state.

For claims under the Product Liability Directive or under national laws for tort, the Rome II Regulation (EC) 864/2007 lays down rules to determine the applicable law.

For claims in contract, the applicable law may be determined by the terms of the contract between the parties. The Rome I Regulation (EC) 593/2008 also lays down rules to determine the applicable law, including where the contract is silent.

The rules for security for costs are determined at a national level by the applicable procedural rules of the member state.

The rules relating to disclosure are determined at a national level by the applicable laws and procedural rules of each member state. Some member states do not have an existing mechanism for disclosure.

See also question 18.3 regarding proposed changes under the revision of the Product Liability Directive (PLD) and the proposed new Artificial Intelligence Liability Directive, which would harmonise the rules for disclosure across the European Union for certain types of claims.

This is determined by the national laws of member states.

The availability of disclosure differs across the European Union; some member states have no existing mechanism for disclosure, which can impact the outcome of a product liability case. See also question 18.3 regarding proposed changes under the revision of the PLD and the proposed new Artificial Intelligence Liability Directive, which would harmonise the rules for disclosure across the European Union for certain types of claims.

The rules relating to the permissible types of evidence and how evidence is presented are determined at a national level by the applicable laws and procedural rules of each member state.

The rules relating to the appointment of experts and the use of expert evidence are determined at a national level by the applicable laws and procedural rules of each member state.

There can be significant variation between member states regarding the rules surrounding how evidence is presented and assessed and the use of expert evidence. This can lead to differences in how product liability claims are dealt with across the European Union.

This is determined at a national level by the applicable laws and procedural rules of each member state.

This is dependent upon the national laws and procedural rules of each member state.

This is dependent upon:

• the national laws and procedural rules in each member state; and
• other factors, including:
• • the complexity of the case;
  • the number of parties involved; and
  • whether it is a group or representative action.

This is dependent upon the national laws and procedural rules in each member state.

The Representative Actions Directive encourages parties to engage in settlement discussions.

Under the Product Liability Directive (PLD), recoverable damages are:

• death and personal injury; and
• damage to or destruction of private property of more than €500 (but not damage to the defective product itself).

The Court of Justice of the European Union has held that:

• compensation for damage relates to what is necessary to eliminate the harmful consequences and restore the level of safety which a person is entitled to expect; and
• this can include the costs of revision surgeries if such an operation is necessary to overcome the defect in the product (see joint cases of Boston Scientific Medizintechnik GmbH v AOK Sachsen-Anhalt Die Gesundheitskasse (C-503/13) and Betriebskrankenkasse RWE (Case C-504/13)).

Member states are given the option to introduce a cap into their national laws on a producer’s total liability under the PLD of not less than €70 million for damage:

• resulting from death or personal injury; and
• caused by identical products with the same defect.

The PLD is expressly without prejudice to national laws relating to non-material damage. This can lead to different outcomes in product liability claims across the European Union.

For claims in negligence (tort) or breach of contract, remedies are determined by the national laws in the member state.

The Sale of Goods Directive lays down a hierarchy of remedies to be implemented under national laws for claims under the statutory warranty, allowing consumers to initially choose between repair or replacement (with certain exceptions).

See question 11.1.

The PLD is expressly without prejudice to national laws relating to non-material damage. The availability of punitive damages is determined by the national laws of the member state in which the claim is brought.

See question 11.1.

This is also determined by the national laws and procedural rules of the member state in which the claim is brought.

This is determined by the national laws and procedural rules of the member state in which the claim is brought.

This is determined at a national level by the applicable laws and procedural rules of the member state in which the claim is brought.

This is determined at a national level by the applicable laws and procedural rules of the member state in which the claim is brought.

This is determined at a national level by the applicable laws and procedural rules of the member state in which the claim is brought.

This is determined at a national level by the applicable laws and procedural rules of the member state in which the claim is brought.

This is determined at a national level by the applicable laws and procedural rules of the member state in which the claim is brought.

This is determined at a national level by the applicable laws and procedural rules of the member state in which the claim is brought.

This is determined at a national level by the applicable laws and procedural rules of the member state in which the claim is brought.

This is determined at a national level by the applicable laws and procedural rules of the member state in which the claim is brought.

There is a complex system of directives and regulations governing product safety in the European Union. These include:

• the General Product Safety Directive (2001/95/EC) (GPSD), which deals with the safety of consumer products generally; and
• various sector-specific regimes, including those dealing with the safety of;
• • toys;
  • electrical products;
  • cosmetics;
  • personal protective equipment;
  • motor vehicles; and
  • medicines.

Yes, see question 15.1

There is no EU-level regulator for general product safety or for most product categories. Enforcement takes place at a national level by national market surveillance authorities.

However, the European Commission can also perform certain functions. For example, it may adopt a formal temporary decision in certain cases to require member states to:

• ban the marketing of a product that poses a serious risk; or
• recall or withdraw that product under the GPSD.

The European Commission also coordinates joint market surveillance actions in relation to certain product sectors.

There are also certain EU-level agencies with some regulatory functions (eg, for chemicals).

Offences and penalties are determined by the national laws of member states.

Certain EU-level laws – including the GPSD and the Market Surveillance Regulation (EU) 2019/1020 – provide that the penalties set under the national laws of member states must be effective, proportionate and dissuasive.

When a manufacturer or importer discovers that it has placed a non-compliant and unsafe product on the market it must take appropriate steps according to the risk. This obligation arises under the General Product Safety Directive (GPSD), as well as under sector-specific regimes. Where the risk is sufficiently serious, the steps that need to be taken will include recall from end users.

Under the GPSD and most sector-regimes, manufacturers, importers and distributors have an obligation to report ‘immediately’ to the competent authorities in impacted member states if they learn that a product they have placed on the market is non-compliant and presents a risk of injury.

New rules under the General Product Safety Regulation (EU) 2023/988 (GPSR) that apply from 13 December 2024 impose an obligation on online marketplaces to report (see question 18.3).

The European Commission has an online system that enables an EU-wide notification to the applicable authorities in impacted member states (new rules under the GPSR that apply from 13 December 2024 will require notifications be made via this system). Some member states may also require specific forms be completed.

The GPSD sets out certain information that is required in the notification.

The penalties for failing to comply are determined by the national laws of member states.

There is no distinction between voluntary and mandatory recalls from a regulatory perspective at an EU level.

Generally, the regulatory regime does not dictate how product recalls are to be conducted. This is left to the discretion of the company conducting the recall, under the supervision of the regulatory authority.

However, new rules under the GPSR will apply from 13 December 2024 and will introduce new requirements for recalls, including:

• how they are advertised;
• mandatory requirements for recall notices; and
• rules on the recall remedy offered.

See question 18.3.

Generally, recall is considered to be a last resort. Other corrective actions can include:

• withdrawal from the supply chain; and
• modification to product design or production processes.

In some cases, a warning to end users may be sufficient.

The PROSAFE Consumer Product Safety in Europe Corrective Action Guide (November 2011, last updated April 2018) can be useful to provide guidance to assist manufacturers when undertaking corrective actions, including recalls.

The Product Liability Directive imposes civil liability and does not extend to criminal liability. However, criminal liability may be imposed under the national laws of member states that determine the enforcement and penalties for non-compliance of product safety laws.

See question 17.1

In VI v KRONE – Verlag Gesellschaft mbH & Co KG (C-65/20) EU:C:2021:471, the Court of Justice of the European Union (CJEU) held that an article in a hardcopy newspaper that contained inaccurate health advice and resulted in an injury to a reader who followed the advice did not constitute a ‘defective product’ under the Product Liability Directive (PLD). The CJEU reaffirmed the position that services alone are not in scope of the existing PLD and considered that the health advice in this case was a service. The CJEU considered whether a service can, when incorporated into a product, render that product ‘defective’ under the PLD. It held that the PLD does not impose strict liability in relation to a product where the damage was caused by a service of which the product was merely the medium. However, the court noted this position could differ if the service were considered to be part of the inherent characteristics of the product, as it is these characteristics alone which determine whether the product is defective under the PLD. It is important to consider this case in light of reforms to the PLD (see question 18.3) that would expand the scope of the strict liability regime to standalone software and certain related services.

The CJEU held that it is clear from the wording of Article 3(1) that it is the affixing of the name, trademark or other distinguishing feature that forms the basis of the status of ‘producer’ – there is no requirement that the own-brander also present itself as being involved in the process of manufacturing the product in some way. The CJEU noted that:

• the purpose of Article 3(1) is to provide an alternative defendant to consumers to ease the burden of having to determine the actual producer; and
• imposing liability on an own-brander is justified because it is effectively using its reputation to make a product more attractive to consumers.

While there are variations from member state to member state, there is an overall trend of more claims being brought and a greater risk of product liability exposure for companies doing business in the European Union. We expect this trend to accelerate with the introduction of the new representative action mechanisms under the Representative Actions Directive (see question 2.1) and reforms to the PLD (see question 18.3).

There is also a trend towards increased enforcement and international cooperation for product safety issues. We expect this to continue with the introduction of the General Product Safety Regulation (GPSR) (see question 18.3).

There has been an unprecedented volume of reforms to product safety, compliance and liability laws in the European Union over recent years.

New rules under the GPSR apply in the European Union from 13 December 2024. The GPSR replaces the General Product Safety Directive and will:

• introduce new requirements for consumer products marketed in the European Union; and
• create new obligations for companies supplying those products to the European Union.

There are a number of significant changes, which include the following:

• introducing mandatory incident reporting in the European Union (for incidents that meet a certain threshold);
• extending the aspects for assessing the safety of a product to include risks linked to new technologies;
• aligning the requirements for non-harmonised and harmonised (ie, generally CE-marked) products that will introduce new requirements for non-harmonised products;
• introducing new requirements for online sales (eg, the need to include safety warnings in the online offer);
• introducing new obligations for online marketplaces; and
• introducing new rules for recalls (new mandatory requirements for recall notices, how recalls are advertised and recall remedies).

As a regulation, the GPSR will be directly applicable in member states without the need to adopt national implementing legislation.

The text for a legislative proposal to revise the PLD was provisionally agreed between EU co-legislators on 14 December 2023. The proposed revisions represent a substantial shift in the EU product liability landscape, making it much more claimant friendly. We expect the legislation to complete the law-making process and enter into force by June 2024, with the new rules applying from mid-2026. Key aspects of the revision include:

• an expanded definition of a ‘product’ to cover:
• • software (both embedded and standalone software, with limited exceptions); and
  • digital manufacturing files;
• an expanded scope to cover damage caused by certain ‘related services’, defined as digital services integrated into, or interconnected with, a product in such a way that the absence of the service would prevent the product from performing one or more of its functions;
• the introduction of strict liability for a wider range of defects, including software updates (or lack of updates), artificial intelligence (AI) and cybersecurity risks;
• amendments to the test for defect, to enable a product to be considered defective where the product does not provide the safety required under EU or national law;
• the expansion of the non-exhaustive list of factors to be taken into account in assessing defect to include product recalls, among other additions;
• an expanded range of recoverable damages to include:
• • medically recognised damage to psychological health; and
  • destruction or corruption of data (not used for professional purposes);
• an expanded range of defendants, with new liability for:
• • authorised representatives where there is no manufacturer established in the European Union; and
  • fulfilment service providers where there is no manufacturer, importer or authorised representative established in the European Union.
• An online marketplace may be held strictly liable where it fails to identify who supplied it with the product within one month upon request in certain cases;
• the introduction of harmonised rules on when a court can order discovery of documents at an early stage across member states (currently not available in all member states);
• easing the burden of proof in certain circumstances, such as:
• • in scientific or technically complex cases where it would be difficult for the victim to prove liability (with examples of AI or medical devices provided in the proposed recitals);
  • where a claimant demonstrates that a product does not comply with mandatory product safety requirements under EU or national laws intended to protect against the risk of damage suffered by the injured person; or
  • in the case of an ‘obvious malfunction’; and
• the extension of the long-stop period where symptoms are slow to emerge from 10 years to 25 years.

On 28 September 2022, the European Commission also published a proposal for a new directive on adapting non-contractual civil liability rules to artificial intelligence, known as the AI Liability Directive (AILD). The proposed AILD would apply to non-contractual civil law claims for damages caused by an AI-system brought under national fault-based liability regimes (eg, under the tort of negligence). It would harmonise only very targeted aspects to enable disclosure and allow the burden of proof to be eased in certain cases, leaving other matters to national law. The proposed AILD sits alongside the reforms to the PLD as part of a two-pronged approach by the European Commission to address the perceived challenges that claimants face in obtaining compensation for damages caused by AI systems. The proposed AILD is a directive, meaning that member states will be required to transpose the requirements into their national laws. The proposal is working its way through the ordinary legislative process and, as at the time of writing, is still at an early stage of this process after work was paused in 2023 to enable the proposed EU AI Act to progress.

The above reforms sit alongside other significant proposals that are in the final stages of the EU law-making process, including other proposals on:

• AI;
• circular economy activities (eg, the right to repair); and
• cybersecurity.

Taken together, these reforms are set to significantly change the liability risks for product manufacturers and suppliers.

Companies that supply products to the European Union should ensure that they understand the upcoming new requirements and review existing products, systems, policies and procedures to determine what changes (if any) will be needed to comply.