New EU product safety law will be a game changer

EU Regulation vs Directive

First of all, the GPSR is a Regulation and not a Directive.

A Regulation has direct effect in all EU Member States, without the intervention of national legislators. (Whereas a Directive needs to be transposed into national law and often allows Member States to include deviating provisions, which obviously jeopardizes the single market principle).

As a Regulation, the provisions of the GPSR apply in full, in all EU Member States.

A safety net

Like the GPSD before it, the GPSR is a legal safety net, but it contains more extensive and more far-reaching provisions than the GPSD. Some of the provisions do not apply to products covered by EU harmonization legislation since they are already covered by such legislation. Other provisions do apply in order to complement EU harmonization legislation, for example when certain types of risks are not covered by that legislation.

This sometimes makes it difficult to determine which provisions of the GPSR do or do not apply to a specific product. It is important to note that the provisions on e.g. recalls and remedies apply to all products within the scope of the GPSR.

The GPSR and “health”

The GPSR refers to the WHO definition of ”health”: The World Health Organization defines “health” as ”a state of complete physical, mental and social well-being and not merely the absence of disease or infirmity.”

The term “product safety” thus takes on a much broader meaning and a whole new dimension.

The following examples show what this can mean in practice:

• A Dutch company that sells tableware introduced a new product line called “Dutch Glory”. This product line – in addition to the typical Dutch emblems of pancakes, cheese, clogs and tulips – featured an illustration of a smiling Anne Frank. After criticism, the company has withdrawn the products from the market.
• Another example that comes to mind is a case where a well-known manufacturer of modeling clay for children took a “phallic-shaped component” off the market because some parents complained about it.

Based on the broad interpretation that the GPSR uses for safety and health, we may expect more of these types of recalls.

More risk assessment under GPSR (pre-market)

Compared to the GPSD, much more attention is paid to risk assessment in the GPSR. Unless already covered by EU harmonization legislation, the GPSR prescribes that manufacturers must carry out an internal risk analysis and draw up technical documentation.

In other words, in most cases a manufacturer will have to carry out a risk analysis and prepare technical documentation before a product is put on the market.

In line with the previous point, it is noteworthy that “mental health” must also be included in that risk assessment. The GPSR for example stipulates that a risk assessment “[…] should take into account the health risk posed by digital connected products, including on mental health, especially on vulnerable consumers, in particular children. Therefore, when assessing the safety of digital connected products likely to have an impact on children, manufacturers should ensure that the products they make available on the market meet the highest standards of safety, security and privacy by design in the best interests of children.”

This may influence the way we assess the risks of for example gaming and social media. And what about the implications for the metaverse?

QR code cannot be sole means of product information

The QR code seems to be commonly accepted as a means to making known product information and instructions. However, despite heavy lobbying, the GPSR does not accept e-labeling as a replacement for old-fashioned labelling and thick multilingual manuals.

Online platforms are the new market surveillance authorities

An entirely new section has been included in the GPSR with obligations for ”providers of online platforms”. This seems to be a real game changer for both providers of online platforms and all economic operators who sell products through online platforms.

Although providers of online platforms are not liable for the compliance and safety of the products themselves sold through their platform, they must ensure – through a battery of due diligence obligations – that traders using their platform only sell products that comply with applicable laws and regulations. This makes providers of online platforms de facto the new “gatekeepers” when it comes to product compliance and safety.

Since a large proportion of traders sell products through online platforms, this could have a tremendous (and hopefully positive) impact on the level of product compliance and safety. If traders want to sell their products via Amazon and the like, they should be in control of their product compliance and safety processes.

In case of repeated non-compliance, pursuant to the GPSR, providers of online platforms will have to suspend their services to a trader until further notice.

Traders outside the EU should establish in the EU

Pursuant to the GPSR, without having a representative established in the EU, economic operators established outside the EU can no longer sell directly to consumers in the EU through online channels. The representative established in the EU will be the person or company to be addressed if products do not comply with EU legislation.

Accident reporting duty under GPSR

The GPSR introduces an obligation for manufacturers to report “without undue delay” accidents caused by products they have placed on the market.

Accidents are defined as occurrences that resulted in an individual’s death or in serious adverse effects on their health and safety. The report must be made to the competent Market Surveillance Authority of the Member State where the accident occurred.

Importers and distributors also play an important role: They must report accidents to the manufacturer.

Do you have a recall plan?

The GPSR prescribes that economic operators should ensure that they have internal processes for product safety in place, allowing them to comply with the relevant requirements of the GPSR. This also means there must be a recall plan in place.

Again, a reservation must be made in regard to products subject to specific Union harmonization legislation. In any case, it is highly recommended to properly safeguard internal processes for product safety within an organization.

Recall? You need at least two remedies

In the event of a recall, the GPSR stipulates that consumers should be given a choice of at least two of the following remedies:

• repair
• replacement
• or refund

Consumers may be offered only one remedy if the other remedies are impossible or disproportionate. This obviously leads to discussion about what is meant by ”disproportionate”.

The burden of recall could become even bigger than it already is

EU legislation normally excels at vague texts and open norms, which need further clarification by means of guidelines or are expected to be further fleshed out by judges in court. It is therefore remarkable that some provisions of the GPSR contain very detailed provisions, which you would normally expect to see in the form of a guideline.

On the one hand that is commendable, on the other hand it can be very tricky.

To give an example: The GPSR prescribes that in the event of a recall, the consumer must be instructed to immediately stop using the affected product. In addition, the GPSR stipulates that, in the event of a recall, the economic operator must collect the unsafe product from the consumer if it is not portable.

But if we take this literally, consumers should stop using, for example, an unsafe car immediately and the car should be collected from the consumer by the manufacturer (or dealer).

The question is whether this is really the intention of the wording in the GPSR. Such a specific wording would undoubtedly lead to a logistical nightmare and a huge financial burden in the event of a recall. Stakeholders seem to have overlooked this in the drafting phase of the GPSR.

Easier for consumers to submit complaints to authorities

The EU rapid information system, also known as RAPEX, will be modernized to enable more efficient corrective measures to be taken across the EU.

One of the aims of this modernization is to make it easier to inform the public, and enable consumers to submit complaints. Manufacturers and their reputation for product quality and safety will therefore be more exposed.

Penalties will be introduced under GPSR

As a final point, it is important to realize that the GPSR introduces penalties for those who violate the GPSR. It is not yet clear how high these penalties will be, but it is expected that they will have a significant deterrent effect for economic operators.

Should we welcome the GPSR?

A new wind is blowing in the EU in the field of product safety. Although the GPSR is not perfect, we can only welcome its arrival. Clearly, if you sell consumer products in the EU, you need to have your product compliance and safety processes in place. Only companies that take product safety seriously will be the winners in a market where product laws and regulations are becoming increasingly complex and demanding.