In today’s global economy, product manufacturers and distributors face a dizzying array of overlapping and sometimes contradictory laws and regulations around the world. A basic familiarity with international product liability is essential to doing business in this environment. An understanding of the international framework will provide thoughtful manufacturers and distributors with a strategic advantage in this increasingly competitive area. This treatise sets out a general overview of product liability in key jurisdictions around the world, giving manufacturers a place to start in assessing their potential liability and exposure.
Readers of this publication will see that each country’s product liability laws reflect a delicate balance between protecting consumers and encouraging risk-taking and innovation. This balance is constantly shifting through new legislation, regulations, treaties, administrative oversight and court decisions. But the overall trajectory seems clear: as global wealth, technological innovation and consumer knowledge continue to increase, so will the cost of product liability actions.
This edition reflects a few of these trends from 2017. Most notably, several jurisdictions proposed or enacted landmark legislation that will have a substantial impact on product liability lawsuits within their borders in the years ahead. For instance, last year China issued the General Provisions of the Civil Law, which constitutes the country’s first step towards the codification of civil law and, among other things, lengthens the statute of limitations previously provided under the country’s Product Quality Law. Additionally, various European countries dealt with thorny issues concerning whether the product liability laws of the European Union will be incorporated within, or displaced by, domestic regulation. In the wake of Brexit, the UK Parliament is debating the European Union (Withdrawal) Bill, which will implement the country’s exit from the EU and ultimately determine the extent to which EU product liability laws remain operative. Similarly, the Federal Supreme Court of Switzerland recently issued a key ruling on whether a domestic regulatory authority can prohibit certain products, notwithstanding their compliance with the applicable EU harmonised norms, if it determines the products fail to meet domestic safety and health requirements.
Meanwhile, the recent introduction of the class-action mechanism in certain jurisdictions has engendered a degree of uncertainty – and potentially increased exposure – for product manufacturers. For instance, France has experienced a surge in product liability lawsuits (particularly in the healthcare sector) in recent years, which many attribute to the newfound availability of class adjudication. By contrast, Japan’s adoption of the Collective Claims Act in 2016 has not yet spawned significant litigation, although it is unclear whether this is due primarily to short-term factors – such as a lack of public awareness of the Act and its inapplicability to disputes arising before October 2016 – or more inherent remedial limitations in the Act, including a claimant’s inability to recover punitive damages, lost profits or damages for personal injury or pain and suffering. Moreover, various product manufacturers continued to face increasing scrutiny throughout the global market, with many countries reporting an unprecedented rise in product recalls affecting primarily the pharmaceutical, food and beverage, and automotive industries. This edition also highlights how certain countries’ product liability laws have grappled with novel issues in the modern economy, such as the emergence of autonomous vehicles and artificial intelligence. Although these changes and trends may be valuable in their own right, they also create a need for greater vigilance on the part of manufacturers, distributors and retailers.
This edition covers 18 countries and territories and includes a high-level overview of each jurisdiction’s product liability framework, recent changes and developments, and a look forward at expected trends. Each chapter contains a brief introduction to the country’s product liability framework, followed by four main sections: regulatory oversight (describing the country’s regulatory authorities or administrative bodies that oversee some aspect of product liability); causes of action (identifying the specific causes of action under which manufacturers, distributors or sellers of a product may be held liable for injury caused by that product); litigation (providing a broad overview of all aspects of litigation in a given country, including the forum, burden of proof, potential defences to liability, personal jurisdiction, discovery, whether mass tort actions or class actions are available and what damages may be expected); and the year in review (describing recent, current and pending developments affecting various aspects of product liability, such as regulatory or policy changes, significant cases or settlements and any notable trends).
Whether the reader is a company executive or a private practitioner, we hope that this edition will prove useful in navigating the complex world of product liability and alerting you to important developments that may affect your business.
We wish to thank all of the contributors who have been so generous with their time and expertise. They have made this publication possible.
Chilton Davis Varner and Madison Kitchens
King & Spalding