WHAT A LIABILITY
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Under legislation introduced in March all suppliers and manufacturers are now liable to prosecution if the goods they supply are found to be sub-standard or dangerous. We investigate how the new consumer protection laws affect road transport operators.
• The business world is concerned that new consumer protection laws are too heavily weighted against the supplier. New legislation covers three main areas.
O Product liability: Producers are liable for damage caused by product defects. 0 General safety requirements: This makes it an offence to supply any consumer goods which are unsafe.
O Misleading price indications: This makes it an offence to give misleading information about prices.
These new laws were introduced to bring the UK into line with the more stringent consumer protection demands of the European Commission. They add considerable extra weight to the hefty amount of consumer legislation in force.
On product liability the law states: 'Where any damage is caused wholly or partly by a defect in the product the producer, importer or 'own brander' shall be liable for damage."
The importer is defined as the person or company who first imports goods into the EC from outside of the Community.
Consumers used to have to prove negligence on the part of the manufacturer before they could claim compensation because of defective products. Now they only have to show that a defective product caused them damage.
This aspect of the new law is aimed primarily at the producers of goods. If retailers or wholesalers however, cannot identify the supplier, producer or importer of a product then they can be made liable for the damage caused. They will also be liable for damage caused by any products to which they have put their own name. This aspect of the law has yet to be tested and it is unclear what the implications might be for those who transport goods of unknown manufacturing origin.
It should be noted that fresh foods are excluded from the terms of the Act while foods involving a manufacturing process are not. A cargo of fresh oranges, for example, would not be effected but a cargo of tinned oranges would be.
The new laws also make it an offence to supply consumer goods "which are not reasonably safe having regard to all the circumstances." This widens consumer protection into areas where there were previously no clear standards or guidelines. Absolutely anyone who supplies goods can be held responsible. The only way a supplier can escape responsibility is to show that he had reasonable grounds not to know that a product was unsafe.
These safety requirements reach right down the chain of supply. In deciding whether or not a product is unsafe courts will take into account: 0 The manner in which a product is marketed and any instructions that are ,plyen with it.
_I The things that might reasonably be expected to he done with a product. LJ The time when a producer supplied the product to another.
The reason why timing is important is because products will only have to conform with the safety standards of the period in which products were manufactured or made. For example, new safety standards might be introduced for a particular product while older versions are still on sale in the shops. The older version of a product will not have to match up to the new standards.
The third part of the law makes it an offence to "give consumers misleading information as to the price of the goods, services or facilities." These provisions are backed up by a Code of Practice which gives detailed guidance to traders.
The new Code spells out precisely what pricing information needs to be given to buyers, how this is to be displayed and explained to them and so on. These provisions apply to any sort of service not just goods.
As with our other consumer laws it will not be possible to evade these new measures by writing in special conditions to any agreements. Draconian powers are given to the authorities to enforce the new measures by giving them the right to search premises, seize goods and serve "suspension notices" on businesses they believe are breaking the law.
These new laws have made many manufactrers nervous. f hey believe that consumer protection has gone too far, and there is a danger that product liability insurance rates will increase if too many claims are made, pushing up the price of goods generally. Some also claim that manufacturers will be wary about introducing new ideas in case they cause damage or injury.
Francis Maude, the Minister responsible for the changes, asserts they should be welcomed in all quarters. Pointing out that there is growing consumer demand for higher quality products he says that consideration about the safety and design of new products is becoming ever more important.
Most hauliers should therefore have little to Lar. To De safe however, it would be wise to review a number of factors: Check on your current insurance provisions and make sure they protect you against any claims that might be made against you under the new Act.
U Check out all indemnity agreements with manufacturers and other suppliers.
Always ensure that clear and concise instructions are provided with any product. 0 Keep all records of other sources of supplies together with the dates of the supply and distribution. This could easily be integrated into usual book-keeping.
Heeding this advice should provide considerable protection for most hauliers. Manufacturers and importers are the primary targets of the new law, but anyone supplying products who cannot identify the source of supplies can be held personally liable. The warning is plain: always be sure of what is being sold, and where it came from.
Of course, transport operators purchase products as well. The new consumer protection legislation should help any operator who finds he has purchased defective products such as a poorly built vehicle, rogue parts and dangerous tyres.
If an operator is able to show that a defective product caused or contributed to an accident, for example, then the product's manufacturer could be held liable for damages.
Further details on the Act and copies of the Code of Practice can be obtained from the Trading Standards office or local Environmental Health deparments of local authorities.
0 by John McQueen