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EU expands existing product liability rules

On 28 September 2022, the European Commission tabled its proposal for the revision of the product liability directive (PLD). The Directive, originally adopted in 1985, creates a regime of strict liability for defective products in the EU. The European Commission’s new initiative aims to adapt the legislation to the digital age and circular economy transition.

The scope of the proposed directive covers all products, ranging from furniture to medicines, considering in particular software and software updates.

In addition, the new product liability rules modify and expand the notion of person to be held liable for defective products.

For example, the proposal allows consumers to seek compensation from the non-EU manufacturer's representative, in accordance with the General Product Safety Regulation (still under negotiation). Consequently, all companies, regardless of where they are based, will need to designate a responsible person based in the EU from whom it will be possible to seek compensation.

Distributors, both offline and online, can be held liable when they are unable to provide the injured person with the name of the EU-based person when requested. This provision also applies to online marketplaces when they present themselves to the consumer as a distributor.

Moreover, the new rules proposed by the European Commission would also cover modified and/or upgraded products. This means that the liability provisions included in the revised Directive would apply to remanufactures and to other business that substantially modify products, unless the defect relates to an unmodified part of the product.

Regarding compensation, under the new Directive, people could claim compensation for harm caused by a defective product, including personal injury, damage to their property or data loss. Moreover, the revised legislation modifies the current rules by removing the existing thresholds that prevented people from being fully compensated.

Finally, in order to counter the asymmetry of information between the manufacturer and the consumer, the new PLD foresees that companies will be obliged to disclose the evidence needed by claimant to prove its case in court. These new rules specifically target complex cases, i.e. linked to Artificial intelligence or pharmaceuticals.

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