Ahead of the implementation of the European General Product Safety Directive (2001/95/EC) in the United Kingdom in October 2005, the Department of Trade and Industry completed an impact assessment that played down the likely impact of the Directive on manufacturing, retail and importing businesses in the UK.
Many commentators predicted that the new regulations would inevitably place a disproportionate additional administrative burden on responsible businesses in order to catch a minority of delinquents. Many perceived the regulations as simply unnecessary, since it was already an offence to put unsafe products on the market, and the UK’s Trading Standards officers already had the power to carry out investigations and take unsafe goods off the shelves
Additional concern was expressed that reporting required by the regulations, the Rapid Alert System for non-food consumer products (“RAPEX”), would become a prime resource for claimants’ lawyers and add to the seeming rush toward a US-style product liability litigation culture.
Now, two years into the new regime in the UK, what has been the impact? And are we able to say whether consumers are any safer as a result of the regulations?
In May this year, the European Commissioner for Consumer Affairs, Meglena Kuneva, published “Keeping European Consumers Safe,” the 2006 Annual Report on the operation of RAPEX. The RAPEX annual report is awash with statistics and gives us an opportunity to take stock and carry out a more objective analysis of the impact that the regulations have had in the UK and the broader EU.
At first glance, industry’s performance in producing safe products is nothing to write home about. In 2006, a total of 1051 recall notifications were made across the EU. In the report’s listing by industry, the top five categories of product accounted for 75 percent of the total number of notifications. Predictably, toys topped the list (221 notifications—24 percent), followed closely by electrical appliances (174 notifications, 19 percent), then motor vehicles (126 notifications, 14 percent), lighting equipment ((8 notifications, 11 percent) and cosmetics (48 notifications, 5 percent). This follows an established pattern and is nothing
new compared with the 2005 statistics.
The report confidently states that, “…these results can be ascribed to an increased awareness of product safety by national authorities and the business sector….” In reality, this report tells us nothing about the state of manufacturers’ awareness of product safety. Responsible manufacturers have put consumer safety at the heart of their strategies for many years. What the report does show is that retailers and manufacturers are continuing to get on with the business of monitoring the safety of their products and, where doubts arise, taking products off the shelves. The main difference is that, following the introduction of the statutory obligation, what were previously voluntary actions are being “notified” to enforcement authorities in accordance with the Directive. They are there in all their glory for all to see on the EU Commission “Europa” website.
The notifications made under Article 12 of the Directive of measures or actions taken for products presenting a “serious risk” has risen from 388 notifications in 2004 to 924 in 2006—a 32 percent increase on 2005. Fiftyseven percent of the serious risk notifications led to compulsory measures being ordered by the national authorities. The measures included banning sales, withdrawal of products from the market, notification to consumers and enforced product recall.
Forty-eight percent of the notifications (440) were for products imported into the EU from China and 17 percent (159) were from unknown origin. It is interesting to note that it took the recent global bad publicity generated by China’s role in producing poor quality toys to trigger a response from the Chinese government. President Hu Jintao recently went public with a pledge to improve his country’s safety record by enforcing strict examination and inspection procedures. Time will tell whether this will make a difference.
Is behaviour really changing? Probably not. Instead, minor safety recall glance at the statistics for notifications in the various participating states to see that the Directive is not being applied uniformly. The author has carried out a pan-European notification of a moderate risk issue and found a varying quality of structures in the different states. Some states considered that the matter was sufficiently serious to be posted on RAPEX, although the majority did not. States such as the UK and Germany have mature systems for handling product safety issues and so it is not surprising to see them toward the top of the list. On the other hand, the author’s experience of certain of the countries that are shown by the report to have posted very few risks on RAPEX is that they have little or no effective notification or enforcement system in place.
Not all authorities are taking the same attitude to risk. For example, the Greek authorities (also at the top of the list) are taking a cautious approach and regularly post recalls that other states deem not to fall into the Directive’s definition of “serious risk.” (A “serious risk” is defined by the Directive as one which requires rapid intervention by public authorities and includes risks of which the effects are not immediate.)
What Does This Tell Us About the Future?
The 2007 report will show a continued upward trend for notification on the RAPEX system. The European Commission will continue to press for widespread and consistent use of RAPEX by EU member states whose statistics fall outside the top six. Eventually, RAPEX will be used routinely to report notifications of service recalls across all member states.
The Commission has committed to raise public awareness of RAPEX and how to access its information. Once RAPEX notification is commonplace, the next inevitable step will be a call for increased prosecution of defaulters. Quite possibly, it also will include an increase in product liability litigation and a call for increased civil liability as well.
In the meantime, retailers and manufacturers should promote their pro-active notification of safety defects as a virtue in the eyes of the consumer associations and the buying public.