What you need to know about the EU’s Proposed General Product Safety Regulation
When the current EU General Product Safety Directive was defined in 2001, e-commerce platforms were just emerging in the European Union (EU). Internet e-commerce was in its infancy, worth around €172 billion, of which 87% was B2B (Eurostat, 2002).
It’s not surprising that twenty years later, when European e-commerce is now 7 times greater (€718 billion), that product safety rules for online marketplaces need to be updated (European e-commerce report 2022). Although some consumers would just assume that an item bought on a digital platform is as safe as one from a regular brick-and-mortar store, that isn’t always the case. Today’s digital or technical developments are not addressed by the same old rules.
Fittingly, the Council of the EU and the European Parliament announced their provisional agreement on the General Product Safety Regulation (GPSR) on November 29th, the day after Cyber Monday. In short, the GPSR aims to ensure that products sold both online and off are safe and up to European standards. But, as we enter the final legislative stages, what can we expect from the proposed regulation?
Market surveillance regime enhanced
The GPSR will create a single market surveillance regime to cover all products. Under such regime, market surveillance authorities will be able to require online platforms to remove illegal content related to dangerous products, disable access to it or display an explicit warning to end users when they access it.
A new Safety Gate Rapid Alert System
A new rapid alert system for the exchange of information on measures concerning dangerous products will be developed to improve the detection and accessibility of unsafe products. The Commission and the Member States will have access to the Safety Gate Rapid Alert System, and each Member State will be required to designate a single national contact point.
Product safety rules updated for online marketplaces
Online marketplaces will have more responsibilities in tackling the sale of dangerous products online. One of them is to set up a single point of contact (SPOC) through the Safety Gate portal. This SPOC will be responsible for facilitating the communication of information on product safety issues. The SPOC must actively cooperate with market surveillance authorities when they detect a dangerous product on the site. They are also responsible for reviewing technical product documentation and ensuring that products have safety information and instructions.
Furthermore, online marketplaces will be required to remove content within a strict deadline after receiving a notification of an illegal listing, and to establish an internal mechanism for handling product safety-related issues.
Recall procedures strengthened
In the case of a product recall, online marketplaces will need to inform all affected customers about the occurrence, avoiding language that downplays the risk. They must also provide impacted customers with at least two remedies for recalled products: repair, replacement or refund, and widely disseminate the information online.
In addition, if a product causes an accident, online marketplaces must report and submit the relevant information to the EU-wide database on products, and face stricter deadlines related to their reporting obligations.
The GPSR lists some criteria EU Member States must take into account for the imposition of penalties. The penalties provided for must be effective, proportionate and dissuasive.
Next steps for the GPSR
The provisional agreement reached on the GPSR is subject to approval by the Council and the EU Parliament. Once formally adopted, members will have 18 months to apply the new rules.
How can Logan and Partners help?
The obligations in the GPSR have considerable impact on businesses, including SMEs. For more information on how we can help you prepare for the GPSR, please contact Isadora Werneck and schedule a free 20-minute consultation.