Unli­mi­t­ed lia­bi­li­ty and rever­sal of the bur­den of pro­of: the new Pro­duct Lia­bi­li­ty Directive

On 28 Sep­tem­ber, the EU Com­mis­si­on published a pro­po­sal to revi­se the Pro­duct Lia­bi­li­ty Direc­ti­ve. The plan­ned direc­ti­ve regu­la­tes many things more cle­ar­ly than its pre­de­ces­sor, some things from the digi­tal world for the very first time. Our over­view demons­tra­tes: The details are quite something.

No devia­ting regu­la­ti­ons permitted

Under the new Pro­duct Lia­bi­li­ty Direc­ti­ve, mem­ber sta­tes will no lon­ger be allo­wed to devia­te from the Direc­ti­ve’s requi­re­ments through natio­nal regu­la­ti­ons in order to achie­ve a hig­her or even lower level of con­su­mer pro­tec­tion. When the pre­vious direc­ti­ve was imple­men­ted, this had hap­pen­ed at various points.

Defi­ni­ti­ons

Unli­ke befo­re, the defi­ni­ti­ons are no lon­ger scat­te­red throug­hout the text of the Direc­ti­ve, but have been grou­ped tog­e­ther under one artic­le. Over­all, the draft is based on the ter­mi­no­lo­gy of the New Legis­la­ti­ve Frame­work. The term “rela­ted ser­vices” is defi­ned for the first time, mea­ning digi­tal ser­vices that are inte­gra­ted into or lin­ked to a pro­duct and would lead to the fail­ure of one or more of its func­tions if miss­ing. In accordance with Artic­le 4(6)©, com­pen­sable dama­ge now also includes dama­ge to or loss of data. While data in a strict­ly pro­fes­sio­nal scope are exempt, any con­su­mer who depo­sits data on a car­ri­er or device beco­mes a lia­bi­li­ty risk. This is becau­se the data on the defec­ti­ve pro­duct its­elf are also protected.

Pro­duct defects now include effects due to self-learning func­tions and the effects of other pro­ducts that can reason­ab­ly be expec­ted to be used in con­junc­tion with the pro­duct at issue. Here, the Inter­net of Things and the incre­asing inclu­si­on of machi­ne lear­ning are addres­sed. When using such tech­ni­ques, com­pa­nies must the­r­e­fo­re also keep an eye on the results of the lear­ning pro­cess and check the inter­ac­tions with other pro­ducts that can occur befo­re pla­cing them on the market.

Respon­dent

If the manu­fac­tu­rer of a pro­duct is loca­ted out­side the EU, the importer of the pro­duct or the manu­fac­tu­rer’s aut­ho­ri­sed repre­sen­ta­ti­ve is to be lia­ble for the dama­ge incur­red (Artic­le 7(2)). If the­se two are also loca­ted out­side the EU, the “ful­fill­ment ser­vice pro­vi­der” is lia­ble, which, accor­ding to the defi­ni­ti­on in Artic­le 4(14), can alre­a­dy be the one who only takes over the pack­a­ging and addres­sing of the pro­duct. Any per­son who mere­ly modi­fies a pro­duct that has alre­a­dy been pla­ced on the mar­ket or put into ser­vice is also con­side­red to be a manu­fac­tu­rer if the modi­fi­ca­ti­on is essen­ti­al in light of Euro­pean or natio­nal pro­duct safe­ty law. Ful­film­ent ser­vice pro­vi­ders in par­ti­cu­lar should the­r­e­fo­re be awa­re that they may be expo­sed to pro­duct lia­bi­li­ty risks for the first time.

Right to disclosure

In accordance with Artic­le 8, if the clai­mant makes a plau­si­ble pre­sen­ta­ti­on of evi­dence and facts, the­re is a judi­cial pos­si­bi­li­ty to requi­re the defen­dant to dis­c­lo­se rele­vant evi­dence. Though the­re is a pro­por­tio­na­li­ty test and busi­ness secrets must be pro­tec­ted, the pro­ce­du­ral pos­si­bi­li­ties are nevert­hel­ess cle­ar­ly shifted to the dis­ad­van­ta­ge of defen­dant companies.

Legal pre­sump­ti­ons

To sub­stan­tia­te the cla­im, the defec­ti­ve­ness of the pro­duct, the dama­ge incur­red and the cau­sal link bet­ween the two must be pro­ven. Under cur­rent law, the bur­den of pro­of rests with the clai­mant (§ 1(4) of the Geran Pro­duct Lia­bi­li­ty Act). In the future, defec­ti­ve­ness will be pre­su­med if any of the fol­lo­wing con­di­ti­ons are met:

  1. the defen­dant refu­ses to hand over the docu­ments reques­ted by the court;
  2. the plain­ti­ff sta­tes that the pro­duct does not com­ply with man­da­to­ry requi­re­ments for its safe­ty under natio­nal or Uni­on law, which are inten­ded pre­cis­e­ly to pro­tect against the risk of harm that has occurred;
  3. the plain­ti­ff sta­tes that the dama­ge was cau­sed by an obvious mal­func­tion of the pro­duct under nor­mal or ordi­na­ry cir­cum­s­tances.
    That the pro­duct defect also cau­sed the dama­ge is pre­su­med if the plain­ti­ff can show that the pro­duct has a defect and that the dama­ge cau­sed is typi­cal of the natu­re and man­ner of such defect. Pre­cis­e­ly becau­se courts other­wi­se deci­de on the basis of free con­vic­tion, defen­dant com­pa­nies will regu­lar­ly have to pro­vi­de evi­dence against the­se presumptions.

Lia­bi­li­ty may not be excluded or limi­t­ed in amount eit­her by con­tract or by law (Artic­le 13). This would ren­der obso­le­te the pre­vious limi­ta­ti­on to EUR 85 mil­li­on, the deduc­ti­ble for pro­per­ty dama­ge, and the limi­ta­ti­on of poten­ti­al clai­mants to the manu­fac­tu­rer in the terms of the Ger­man Pro­duct Lia­bi­li­ty Act. Com­pa­nies con­se­quent­ly have unli­mi­t­ed liability.

Sum­ma­ry

On the one hand, the scope of the Pro­duct Lia­bi­li­ty Direc­ti­ve will be vast­ly exten­ded to cover chan­geable (digi­tal and self-learning) pro­ducts and data in the future. At the same time, the pre­sump­ti­ons make it easier for poten­ti­al clai­mants to file actions and sub­stan­tia­te their claims. Such rever­sals of the bur­den of pro­of are known in the area of pro­du­cer lia­bi­li­ty in accordance with § 823 of the Civil Code: Lia­bi­li­ty in accordance with the new Pro­duct Lia­bi­li­ty Direc­ti­ve, howe­ver, also allows access to per­sons remo­te from pro­duc­tion. Each com­pa­ny should the­r­e­fo­re ascer­tain the pro­ducts with which it falls within the scope of the Direc­ti­ve and how it can lea­ve the scope of the Direc­ti­ve again if neces­sa­ry. Insu­rance poli­ci­es may also requi­re rene­wals as a result of the chan­ges. Once again, it also shows how important it is for com­pa­nies to pay atten­ti­on to com­pli­ance with pro­duct safe­ty regulations.

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