13th edition – July 2021
Here’s the next edition of our monthly bite-sized digest, Productwise 3-2-1 where each month, we’ll be bringing to the top of your inbox (and your agenda):
- 3 key takeaways from the past month
- 2 hotbed issues you should keep your eye on
- 1 practice tip to keep you at the top of your game
This month it’s all about the proposed revision of the EU General Product Safety Directive, a recent decision of the CJEU on the EU Product Liability Directive, plans to update the EU product liability framework, US CPSC nominations, upcoming guidance on green claims in the UK and legal and practical tips for insurance claims.
3 top things from the month just gone
- Proposals for the revision of the EU General Product Safety Directive published. The European Commission published its proposals for a revision of the General Product Safety Directive, paving the way for a new dawn in the form of the General Product Safety Regulation on 30 June 2021. This is a major development that has been more than a decade in the making, and the potential ramifications for the products world are significant and wide-ranging. These proposals would take the regulation of consumer product safety to new levels not only in Europe, but around the world. The proposals will bring the regulation of general consumer product safety in-line with the provisions of the New Legislative Framework (primarily Decision No. 768/2008) and the newly-introduced Market Surveillance Regulation (EU) 2019/1020 – both of which cover the range of product sectors governed by “harmonised” measures – typically those products requiring the CE mark. But these latest proposals go much further, and in many important respects will impose additional requirements for CE marked products as well. Proposals cover areas such as: new requirements for GPSD products, online sales, mandatory incident reporting, the content of recall notices and conduct of recalls, international cooperation between regulatory agencies and penalties of up to 4% of annual turnover for non-compliance. Read our Productwise blog here for our take on what has been proposed and how you can provide feedback to the Commission.
- Plans to update the EU product liability framework published. The European Commission published details about its plans (in the form of an Inception Impact Assessment) on 30 June 2021 to update the EU product liability framework consisting of the EU Product Liability Directive and national liability laws of member states. The updates are looking to, among other things, deal with challenges arising from circular economy developments, online marketplaces, digital technologies and artificial intelligence. Feedback on the Inception Impact Assessment closes 28 July 2021. See here for more information.
- CJEU rules that strict liability under the EU Product Liability Directive did not apply to a product that was merely the medium for a service that caused the damage. In a judgement handed down on 10 June 2021 in the case of VI v KRONE – Verlag Gesellschaft mbH & Co KG, the European Court of Justice held that an article in a hardcopy newspaper which contained inaccurate health advice and resulted in an injury to a reader, did not constitute a “defective product” under the EU Product Liability Directive. This is an important decision with ramifications beyond printed media with the Court finding that the Product Liability Directive did not impose strict liability in relation to the product (the printed newspaper) where the damage was caused by a service (inaccurate health advice), of which the product was merely the medium. Further detail and analysis on the case will be posted on our Productwise blog here.
2 things to look out for
- Upcoming guidance from the UK CMA on “green claims”. The UK Competition and Markets Authority (CMA) is currently seeking views on draft guidance for businesses about making “green claims”. The purpose of the guidance is to help businesses understand and comply with their existing obligations under UK consumer protection laws when making environmental claims about products or services. It sets out 6 principles that environmental claims should follow. The consultation of the draft guidance will run until 16 July 2021, with the final guidance expected to be published by the end of September 2021. Further information can be found here and here and an article by one of the team on PLC can be found here.
- Biden nominates Alexander Hoehn-Saric as Chairman and Mary Boyle as Commissioner of the U.S. Consumer Product Safety Commission. President Biden announced his intent to nominate Alexander Hoehn-Saric to be the eleventh Chairman of the U.S. Consumer Product Safety Commission and Mary Boyle to be a Commissioner of the agency. If confirmed, Hoehn-Saric and Boyle will allow the Commission to remain at a 2-2 split between Democratic and Republican appointed commissioners, with the impending departures of Acting Chairman Bob Adler and Commissioner (and former Chairman) Elliot Kaye in October. Should Adler reconsider his intention to retire and stay at the agency for an additional year, the Commission would have a Democratic majority until at least October 2022. These nominations, in addition to the administration’s proposed budget of $170 million for the CPSC in Fiscal Year 2022 (an increase of $35 million), illustrate that the Biden administration is clearly prioritizing product safety and the CPSC. See our blog here to find out more.
1 top practice tip
- Legal and practical tips for insurance claims in a transitioning market: Sam Tacey, special counsel in Cooley’s Insurance & Reinsurance team, recently presented on insurance claims issues on a Marsh hosted webinar ‘Insurance Claims: Legal and Practical Tips in a Transitioning Market’. Sam’s presentation addresses 4 key areas (i) settlement of underlying claims (ii) cover for defence costs (iii) notice provisions (iv) COVID-19 FCA test case and business interruption. The recording can be accessed via a link available here.
The Cooley Products Team