Bill C-6, the proposed Canada Consumer Product Safety Act, intends to implement a regulatory scheme for all consumer products except for foods, drugs, cosmetics and certain products regulated under other federal statutes. In addition to bringing under direct government regulation consumer products that had not previously been regulated, the proposed new legislation will grant a broad range of powers to Health Canada inspectors to issue recalls and other remedial orders “on reasonable grounds” that a product is a danger to human health or safety. Given the wide scope of the proposed legislation, we are advising our clients to monitor its progress in anticipation of the new requirements.

Miller Thomson Analysis

Prohibitions

Bill C-6 provides that no manufacturer or importer shall manufacture, import, advertise or sell a consumer product that (a) is a danger to human health or safety; (b) is the subject of a recall order or voluntary recall in Canada because the product is a danger to human health or safety; or (c) is subject to an inspector’s order that has not been complied with. A “danger to human health or safety” refers to any existing or potential unreasonable hazard that is posed by the consumer product during its normal or foreseeable use that may cause death, injury or have an adverse effect on that individual’s health, including any chronic adverse effect on human health. “Unreasonable hazard” is not further defined in the proposed legislation.

Mandatory Recalls

Bill C-6 grants to inspectors the power to conduct spot inspections. Moreover, in the course of conducting spot inspections, the inspector will have the power to order a recall or take other remedial measures where the inspector believes on reasonable grounds that a consumer product is a danger to human health or safety. What constitutes “reasonable grounds” is not defined within the Bill.

Reporting Obligations

The Bill also requires a manufacturer, importer or seller to report an incident or occurrence located in Canada or elsewhere that could reasonably be expected to have serious adverse health effects or result in serious injury. This means that any incident and any product recall that occurs anywhere in the world would have to be reported to Health Canada. The reporting obligation requires that notification be provided within 48 hours of becoming aware of the incident or the recall and a more detailed report be provided within 7 days.

Furthermore, Health Canada may disclose confidential business information related to a consumer product to a person or government working in the area of protection of health, safety or the environment, without the consent of or notification to the person to which the information relates. This means that information obtained under Bill C-6 reporting obligations could be distributed to another person without the reporter’s knowledge.

Penalties

Failure to comply with an inspector’s order for recall or remedial measure will result in an administrative penalty of up to $25,000 for each day the offence continues. Failure to comply with the other provisions under the proposed legislation will result in personal fines of up to $5 million or imprisonment for a term not longer than two years, or both. In addition, directors and officers will be liable where they have directed, authorized or assented to the commission of the offence.