The New EU General Product Safety Regulation Will Be A Game Changer
By Rutger Oldenhuis LLM
Last December, the text of the long-awaited EU General Product Safety Regulation (GPSR) was finalized, which will replace the outdated EU General Product Safety Directive. The GPSR is expected to come into force by the end of 2024. The ink has yet to dry, but one thing is certain: selling consumer products in the EU will never be the same. In this article I summarize the main highlights of the GPSR.
First of all, it is a Regulation and not a Directive. A Regulation has direct effect in all EU Member States, without the intervention of national legislators. 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. That is no longer possible with a Regulation. The provisions of the GPSR therefore apply in full in all EU Member States.
Like the GPSD, 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 Union harmonisation legislation since they are already covered in such legislation. Other provisions do apply in order to complement Union harmonisation legislation, for example when certain types of risks are not covered by that legislation. This sometimes makes it a difficult puzzle 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.
Introduction of ‘health’
Remarkably, 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) pancakes, cheese, clogs and tulips – also 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 After criticism, the company has withdrawn the products from the market.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 manufacturer of play clay took a “phallic-shaped toy” off the market because some parents had 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.
Risk assessment (pre-market)
Compared to the GPSD, much more attention is paid to risk assessment in the GPSR. Unless already covered by Union 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 paragraph, it is remarkable 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 to think of the metaverse?
QR code not accepted as sole means of product information
The QR code seems to be commonly accepted as a means to product information and instructions. However, despite heavy lobbying, the GPSR does not accept E-labelling 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 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 most 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 or 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 platform will have to suspend their services to this trader until further notice.
Traders outside the EU selling directly to 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
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 shall 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? 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 a refund. Consumers may only be offered one remedy if the other remedies are impossible or disproportionate. This obviously leads to discussion about what is meant by ‘disproportionate’.
A snag that can make the burden of a recall 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. If we take this literally, for example, consumers should stop using 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 intended. It would undoubtedly lead to a logistical nightmare and a huge financial burden. Stakeholders seem to have overlooked this in the drafting phase of the GPSR.
It will be easier for consumers to submit complaints to authorities
The ‘Union rapid information system’, also known as ‘RAPEX’, will be modernised to enable more efficient corrective measures to be taken across the EU. One of the aims 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.
As a final comment, it is important to realise 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 play a significant deterrent effect for economic operators.
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.