Legal andarketplace Incentives for Suppliers Declaration of Conformity
George T. Willingmyre, P.E.
April, 2000
What
are the legal aspects in USA that support marketplace confidence in SDoC?
What are the legal aspects in Europe that
support marketplace confidence in SDoC?
Background:
6. An effective market surveillance system is an essential
underpinning to reliance on supplier’s declaration. Another factor which
may be relevant to the willingness of regulators to rely on supplier’s
declaration is the extent to which national laws regarding
manufacturers’ liability supplement (or do not supplement) efforts by a
regulatory agency to assure compliance with regulatory requirements. In
addition, a regulator may believe that a different approach to conformity
assessment is necessary for confidence that the product/process/service
fulfils the technical regulation.
The Figure incorporated by reference Incentives for SDoC under conditions of Post Market Surveillance and Sanctions for False Statements portrays key marketplace factors in Europe and in the United States which support the use of SDoC.
The Figure and the descriptions of product labeling, market surveillance and product liability considerations in bringing a product to market in the United States and Europe are intended as basic introduction to the legal and marketplace incentives encouraging manufacturers to build products complying with relevant mandatory and voluntary marketplace requirements and labeling them so when appropriate. This paper does not provide legal advice or counsel. Readers are strongly advised to consult their attorneys for specific legal interpretations.
George T. Willingmyre, P.E. March 28, 2000
What are the
legal and marketplace aspects in USA
that support marketplace confidence in SDoC?
A variety of laws and regulations in the United States call for products to be accurately labeled. Such laws and regulations carry severe penalties for those businesses that would falsely claim conformity to a standard. Accompanying government and private sector marketplace surveillance programs help the marketplace self police itself against both products that should be meeting appropriate standards, but are not so labeled and products that are falsely claiming conformity to standards. Product labeling regulations and marketplace surveillance activities are covered in many specific pieces of legislation within the jurisdiction of many different agencies. One would have to determine which agency has jurisdiction of the specific product or even the specific product characteristic in some cases and then would have to research those regulations for the applicable requirements in any given product field.
Additionally
direct product liability considerations and both regulatory and product
liability considerations related to product recalls act together to
encourage manufacturers to build products to the relevant safety
standards in order to minimize these risks of defending against
claims of defective products or calls for mandatory or voluntary product
recalls.
One recent US example of a manufacturer
running afoul of a specific regulatory requirement for producing
accurate testing results is that of
the Clean Air Act and Saybolt. Saybolt Inc. agreed to plead
guilty in Federal Court to charges of falsely certifying results of
qualitative test of reformulated gasoline as required under the Clean
Air Act. As part of the
penalty, Saybolt agreed to publicly announce in the news media; “…
As a result of a pattern of data falsification, our company has agreed
to pay a fine of $3,400,000 and to be placed on probation for five
years. We also agree to
publish this announcement. Accurate reporting of test results … is
essential. Failure to do so
will expose you to severe penalties.
It is also smart business.” [ASTM Standardization News, November 1998 page 62]
In addition to specific regulatory oversight,
In the U.S., the performance of products in the market place is
typically monitored by competitors, who do so to protect the market
share for their products. Industry
reports on false claims are given to the Federal Trade Commission (FTC)
and the Food and drug Administration (FDA) which have the capability,
through the Fair Package and Labeling Act, to take action against those
who present false and misleading information.
These requirements, implementing the Fair
Packaging and Labeling Act, are found in Title 15 – Commerce and
Trade; Chapter 39 –Fair Packaging and Labeling Program.
Section 1451 states the Congressional declaration of policy as
follows:
Informed consumers are essential to the fair and efficient functioning
of a free market economy. Packages
and their labels should enable consumers to obtain accurate information
as to the quantity of the contents and should facilitate value
comparisons. Therefore, it
is hereby declared to be the policy of the Congress to assist consumers
and manufacturers in reaching these goals in the marketing of consumer
goods. (Pub. Las 89-755,
Sec.2, Nov3, 1966, 80 Stat 1296)
Section 13 of Pub. Law 89-755 distributes the
responsibilities between the Food and Drug Administration
and the Federal Trade Commission
As implemented, these requirements are that all
advertising claims must be substantiated.
Labels are construed as claims; therefore everything on the label
must be able to be substantiated. The
requirements include methods of substantiation. Claiming conformity to or compliance with a standard, code or
regulation must be substantiated.
In a typical month, a half dozen FTC actions are
listed in the Federal Register. FTC
does not have the staff to do much inquiry but depends upon competitors
and consumers to identify false claims.
If a product does not meet the requirement claimed on the label
of if the label is just miss
worded, FTC may be notified.
There are tough consequences for false
certification of test results. Increasing
regulatory agency use of “suppliers declaration of conformity” to
relevant requirements in standards and the associated transfer of
responsibilities for conducting tests from the public to the private
sector is often accompanied with a fear that businesses will not
actually perform the cited tests or will otherwise falsely claim to
comply. Penalties
for such illegal actions can be severe.
In
another case involving misleading advertising and product claims, Telxon Corporation announced that the U.S. District Court, Northern
District of Ohio granted
its request for a preliminary injunction against Symbol Technologies,
Inc. (NYSE: SBL) of Holtsville, New York, enjoining Symbol from continuing to make false and
misleading statements about its frequency hopping wireless network; namely, Spectrum 24. [Akron,
Ohio. December 19, 1996 PR Newswire] In addition, the court
ordered a public retraction of the false and misleading statements which
have appeared in various forms of advertising and public communications
made by Symbol.
The court's ruling stems from a lawsuit filed by Telxon on September 4,
1996, charging that Symbol engaged in violations of the federal Lanham
Act and the Ohio Deceptive Trade Practices Act by making false and
misleading statements concerning, among other things, issues of
standards compliance, interoperability, and open systems in connection
with Spectrum 24. Frank Brick, Telxon's President and Chief Operating
Officer, stated, "We are pleased by the court's decision and hope
that this will clarify for customers and the marketplace any confusion
Specifically,
the judgment entry issued by the court, enjoins Symbol as follows:
A.
from
making statements (expressly or in substance) that Spectrum 24 is
compliant, meets, conforms or is compatible with the IEEE 802.11
standard or draft standard.
B.
from
making statements (expressly or in substance) that Spectrum 24 is an
open system.
C. from
making statements (expressly or in substance) that:
IEEE 802.11 is a
standard for interoperability;
compliance with the IEEE 802.11 will result in interoperability;
Spectrum 24 is interoperable; and
IEEE 802.11 will provide interoperability between access points.
As
an additional component of injunctive relief, Symbol was ordered by the
court to issue a public retraction stating as follows:
Symbol
has made false and misleading statements that Spectrum 24 (Symbol's
frequency hopping network) is compliant with the IEEE 802.11 standard.
The truth is that the IEEE 802.11 standard has not been finalized.
Spectrum 24 is not compliant with the IEEE 802.11 draft standard. And in
the first available edition, Symbol shall publish the retraction in a
full one page advertisement in each magazine where it published its
advertisement [that contained its false and misleading statements],
Product
Liability considerations in the United States lead
manufacturers to reduce their exposure to liability suits by
building products complying to
applicable regulatory requirements and to the most relevant applicable voluntary safety and warning
labeling standards. Meeting
such standards and declaring conformity of their products to such
standards can be used as a defense although not a guaranteed shield
against a plaintiff’s claim of damages and injuries due to a
defective product. Not
meeting a relevant regulatory requirement or applicable voluntary
standard is certain to be used as evidence that a manufacturer did not
meet reasonable expectations to produce a safe product.
The Restatement of Torts (Third) is a comprehensive general statement of the tort law in the United States governing liability for defective products. Even as a general statement, however, it is subject to interpretation and variations in individual states and courts. The third edition states in section 2 with respect to product defects:
A
product is defective when, at the time of sale or distribution, it
contains a manufacturing defect, is defective in design, or is defective
because of inadequate instructions or warnings. A product:
(a)
contains a manufacturing defect when the product departs from its
intended design even though all possible care was exercised in the
preparation and marketing of the product;
(b)
is defective in design when the foreseeable risks of harm posed by the
product could have been reduced or avoided by the adoption of a
reasonable alternative design by the seller or other distributor, or a
predecessor in the commercial chain of distribution, and the omission of
the alternative design renders the product not reasonably safe;
(c)
is defective because of inadequate instructions or warnings when the
foreseeable risks of harm posed by the product could have been reduced
or avoided by the provision of reasonable instructions or warnings by
the seller or other distributor, or a predecessor in the commercial
chain of distribution, and the omission of the instructions or warnings
renders the product not reasonably safe.
An
allegation that a product is defective in design is the most common
allegation asserted in a products liability action. Section 2(b)
adopts what is essentially a
negligence analysis for design defect claims. The Restatement
requires the plaintiff to establish that the foreseeable risks of
harm could have been prevented by a "reasonable alternative
design," and the absence of that alternative design renders the
product "not reasonably safe." Furthermore, the plaintiff must
prove that such a reasonable alternative design was, or reasonably could
have been, available at the time of sale or distribution of the product.
However,
many products liability actions involve allegations of inadequate
warnings. Section 2(c) addresses
warning defects and adopts a reasonableness test for judging the
adequacy of product instructions and warnings. The reasonableness
standard is more difficult to apply in the context of warnings and
instructions than it is in the area of design defects. Too many warnings
or warnings that are too detailed may not be read by consumers;
determining the optimum number and type of warnings and instructions for
a given product is complicated.
In
connection with liability for defective design or inadequate
instructions or warnings:
(a) A product’s
noncompliance with an applicable product safety statute or
administrative regulation renders the product defective with respect to
the risks sought to be reduced by the statute or regulation; and
(b)
A product’s compliance with an applicable product safety statute or
administrative regulation is properly considered in determining whether
the product is defective with respect to the risks sought to be reduced
by the statute or regulation, but such compliance does not preclude as a
matter of law a finding of product defect.
The
American National Standards institute (ANSI) estimates that its
standards were cited in 400 product liability cases over a recent 15
year period. Several
court cases illustrate the variety of outcomes possible with regard to
defendant’s and plaintiff’s reference to relevant regulations and
voluntary standards.
In the case Wagner
v. Clark Equipment Co, Inc., 243 Conn. 168, 700 A.2d 38 (1997). the
Connecticut Supreme Court decided
that evidence of compliance with OSHA regulations may be considered in
design defect cases and the court went so far as to state that where a
product complies with and exceeds OSHA standards, the jury may
permissibly draw the inference that the product is not defective and
that the manufacturer acted with due care in its design.
Illustrating a contrary conclusion, the Georgia Supreme Court ruled in a 6-1 decision that Georgia law permits a personal
injury product liability claim when an auto maker sells a car to a
Georgia citizen and the vehicle is in compliance with the National
Automobile Safety Act. Doyle et al. v. Volkswagenwerk
Aktiengesellschaft et al, No. S96Q1529
(March 3, 1997).
In
the case of I. Potter v. Chicago Pneumatic Tool Co.
241
Conn. 199, 694 A.2d 1319 (1997),, it
was
affirmed
that it is up to a plaintiff to prove that, at the time the defendants
manufactured their products, a feasible alternative design existed which
was safer than the defendants’ design. The existence
of a regulation or a voluntary standard would be compelling evidence in
such a situation
Illustrating the principal that compliance with a voluntary
standard is not a completely sufficient defense against a product
liability claim is the case of King v. National Spa & Pool
Institute (NSPI), Inc., 570 So. 2d 612 (Ala. 1990) (hereafter "King").
Taken
from Products Liability Claims against voluntary standards
developers—an update on recent developments
at http://web.ansi.org/public/library/guides/prod_liability.html
In this case the Supreme Court in Alabama held that even the group that
prepares a relevant voluntary
safety standard owes a duty to consumers and may be found liable.
A
product can be "unreasonably dangerous" for purposes of strict
products liability if it lacks adequate directions or warnings. It is a
fundamental principle of the law of product liability
that a manufacturer has a responsibility to instruct consumers as
to the safe use of its product and to warn consumers of dangers
associated with its product of which the seller either knows or should
know at the time the product is sold.
In assessing what hazards are foreseeable, a manufacturer is held to the
status of an expert. The lack of adequate warnings renders a product
defective and unreasonably dangerous even if there is no manufacturing
or design defect in the product.
Many courts have recognized the failure to warn as a type of
"defect" upon which recovery in both strict liability and
negligence may be grounded. Failure to warn has led to recovery when
there was a complete absence of warning where one was needed to prevent
the product from being unreasonably dangerous.
In Torres-Rios v. LPS Laboratories Inc., 1998 WL
429337 (1st Cir. 1998), The United States Court of Appeals for the First
Circuit recently affirmed summary judgment in favor of the manufacturer
of a product used to clean electrical equipment, holding that the
product's English-language warning label met federal standards and,
therefore, a jury could not find the product to be unreasonably
dangerous.
The
case of Product Liability in
Japan: The Exploding T.V. Case Taishi Kensetsu Kogyo Ltd. v.
Matsushita Electric Industrial Co., Ltd
available at http://www.law.kyushu-u.ac.jp/~luke/tvcase.html
illustrates what appears to be the
counterpart situation in Japan where the
negligence of the manufacturer is presumed when a defect is found in the
product, the user doesn't have any duty further to elucidate the
specifics of cause of the defect or of breach of the duty of care, and
the manufacturer has to rebut the presumption by clarifying the cause of
defects, in order to be released from the liability.
In this case the defendant argued that the product in question
met the relevant type testing standards of MITI:
The
Restatement of Torts (Third) also provided that entities
engaged in the business of selling or otherwise distributing
products are subject to liability for harm to persons or property caused
by the seller’s failure to recall a product after the time of sale or
distribution :
(a)
(1) a statute or other governmental regulation specifically requires the
seller or distributor to recall the product; or
(2)
The seller or distributor, in the absence of a recall requirement under
Subsection (1) undertakes to recall the product; and
(b)
The seller or distributor fails to act as a reasonable person in
recalling the product.
In
a regulatory or products liability context the term "recall"
is a term of art. It refers to a very specific device by which a
manufacturer, seller, licensee, importer, distributor, retailer, or
other entity in the chain of commerce of a product, advises purchasers
that certain actions/activities should be undertaken with respect to
that product. Of course, a recall can be effected in any number of ways.
Recall may consist merely of the addition of a warning to a given
product; it could entail repair, replacement or retrofit of that
product; or it could require repurchase by the manufacturer and a refund
of the purchase price to the buyer/consumer.
In recent
years, recalls have become fairly pervasive and have received
considerable attention from the media and various business and consumer
groups. Several federal administrative agencies, such as the National
Highway Traffic Safety Administration, Consumer Products Safety
Commission, Food and Drug Administration, Department of Housing and
Urban Development, Federal Trade Commission, Federal Aviation
Administration ("FAA"), and other entities, have statutory
authority to recall products or take action so that a recall or what
amounts to a recall. Where the government has ordered a recall, there is
no question about the manufacturer's duty to comply -- it must.
In the
case of the Consumer Product Safety Commission Section 15(b) of the
Consumer Product Safety Act establishes reporting requirements for
manufacturers, importers, distributors and retailers of consumer
products. Each must notify the Commission immediately if it obtains
information which reasonably supports the conclusion that a product
distributed in commerce (1) fails to meet a consumer product safety
standard or banning regulation, (2) contains a defect which could create
a substantial product hazard to consumers, (3) creates an unreasonable
risk of serious injury or death, or (4) fails to comply with a voluntary
standard upon which the Commission has relied under the CPSA.
Companies that distribute products that violate regulations issued under
the other laws that the Commission administers -- the Flammable Fabrics
Act, 15 U.S.C. § 1193-1204; the Federal Hazardous Substances Act, 15
U.S.C. § 1261-1278; the Poison Prevention Packaging Act, 15 U.S.C. §
1471-1476; and the Refrigerator Safety Act; 15 U.S.C. §1211-1214 --
must also report, if the violations may also constitute product defects
that could create a substantial risk of injury to the public or may
create an unreasonable risk of serious injury or death. The
CPSC has released a helpful and comprehensive RECALL
HANDBOOK A
Guide for Manufacturers, Importers, Distributors and Retailers on
Reporting Under Sections 15 and 37 of the Consumer Product Safety Act
and Section 102 of the Child Safety Protection Act and Preparing for,
Initiating and Implementing Product Safety Recalls that clarifies the
Commission review of whether a product recall may be necessary. Available at http://www.cpsc.gov/businfo/8002.html
Several
recent examples of CPSC-required product recalls are the following:
CPSC,
Michael's Stores Inc. Announce Recall of Lighters WASHINGTON D.C March 9,
23000 - In cooperation with the U.S. Consumer Product Safety
Commission (CPSC), Michael's Stores Inc., of Irving, Texas, is recalling
about 213,000 all-purpose lighters. These lighters can leak butane when
they are ignited, causing an excessive burst of flame from the tip or
other areas of the lighter. This presents a risk of fire and burn
injuries to consumers. Details at http://www.cpsc.gov/cpscpub/prerel/prhtml00/00076.html
CPSC,
New Cole Sewell Corp. Announce Recall of Storm Doors WASHINGTON, D.C. -
In cooperation with the U.S. Consumer Product Safety Commission (CPSC),
New Cole Sewell Corp., of St. Paul, Minn., is recalling about 23,000
storm doors manufactured without retaining pins in the upper windows.
The upper window can fall out and could injure nearby consumers. New
Cole Sewell Corp. has received 15 reports of upper windows falling out
of the storm doors. No injuries have been reported. The recall involves
storm doors manufactured from June 1, 1999, through August 16, 1999
Details at http://www.cpsc.gov/cpscpub/prerel/prhtml00/00066.html
While in
most cases a product recall is carried out as the result of a regulatory
scheme, it is not always so. There exist many situations where there
is no requirement that a product must be recalled pursuant to a statute, rule
or regulation. At times, a manufacturer, in the interest of safety,
might institute a recall in the absence of a regulatory scheme requiring
a recall.
Review of
the case law in the area of "recall" law reveals that there
are no hard and fast rules. Some jurisdictions require that, upon
learning of a defect, a manufacturer recall/retrofit that product; other
jurisdictions leave recall to regulatory authority.
A company that has designed and manufactured a product to a
relevant safety standard and subsequently truthfully declared the
product’s conformity to the relevant standard will necessarily be less
likely to find himself in the situation of having to perform either a
regulatory-required or voluntarily imposed product recall at the very
minimum with respect to the safety considerations addressed in the
relevant standard compared to a similar company which has not done
so.
What are the
legal aspects in Europe that support marketplace confidence in SDoC?
This Section Extracted in entirety from
GUIDE
TO THE IMPLEMENTATION OF DIRECTIVES
BASED ON NEW APPROACH AND GLOBAL APPROACH New Approach Guide -
1999 Edition (Draft) This Guide is intended to contribute to better understanding of
directives based on the New Approach and the Global Approach, and to
their more uniform and coherent application across different sectors and
throughout the Single Market. The
"New Approach Guide - 1999 Edition (Draft)" is available
on line and for download: http://www.eotc.be/News/EC/EC_Guide/NA_Guide99.htm
Marketplace Surveillance as part of Member
State Responsibility for implementation of New Approach directives
|
Market surveillance involves two main stages: (1) National surveillance authorities shall monitor that products placed on the market comply with the provisions of the applicable national legislation transposing the New Approach directives, and (2) subsequently, when necessary, they shall take action to establish conformity. Although market surveillance operations cannot take place during the design and product stages, efficient enforcement usually requires that surveillance authorities act in collaboration with manufacturers and suppliers in order to prevent the placing on the market of non-compliant products |
Enforcement of Community legislation is an obligation on Member States: Art. 10 of the EC Treaty requires Member States to take all appropriate measures to ensure fulfillment of their obligation arising out of the Treaty. Market surveillance is an essential tool for enforcing New Approach directives, in particular by taking measures to check that products meet requirements of the applicable directives, that action is taken to bring non-compliant products into compliance, and that sanctions are applied when necessary.
A high level of protection is envisaged in the New Approach directives. This requires Member States to take all necessary measures to ensure that products may be placed on the market and put into service only if they do not endanger the safety and health of persons, or other interests covered by the applicable New Approach directives, when correctly constructed, installed and maintained, and used in accordance with their purpose. This implies an obligation for Member States to organize and carry out market surveillance, in a way that is effective and sufficiently extensive to discover non-compliant products. This is to protect not only the interests of consumers, workers and other users, but also the interests of economic operators from unfair competition.
Market surveillance is the responsibility of public authorities. This is, in particular, to guarantee the impartiality of market surveillance operations. Each Member State can decide upon the market surveillance infrastructure, for example there is no limitation to allocate responsibilities between authorities on a functional or geographical basis as long as surveillance is efficient and covers the whole territory. As a result, the legal and administrative market surveillance infrastructures differ from one Member State to another. This requires, in particular, that efficient administrative co-operation between competent national authorities is in place so that an equivalent level of protection can be ensured throughout the Community, in spite of the competence for market surveillance being limited to each Member State’s territory.
Market surveillance authorities should have the necessary resources and powers to conduct their surveillance activities. This is to monitor products placed on the market and, in case of non-compliance, to take appropriate action to enforce conformity. As regards personnel resources, the authority needs to have, or have access to, a sufficient number of suitably qualified and experienced staff, which has the necessary professional integrity. To guarantee the quality of the test data, the testing facility used by the authority should comply with the relevant criteria of the EN 45001 standard. The authority should also be independent, and carry out its operations in an impartial and non-discriminatory way. Further, the authority should carry out market surveillance respecting the principle of proportionality, for example action must be in accordance with the degree of risk or non-compliance and the impact on the free circulation of products may not be more than is necessary for achieving the objectives of market surveillance.
The surveillance authority may subcontract technical tasks (such as testing or inspection) to another body, provided that it retains the responsibility for its decisions, and provided there is no conflict of interest between the other body’s conformity assessment activities and its surveillance tasks. In doing so the authority should exercise great care to ensure that the impartiality of the advice it receives is beyond reproach. The responsibility for any decision to be taken on the basis of such advice shall reside in the surveillance authority.
As a general rule, it is inappropriate for notified bodies to be responsible for market surveillance. In order to avoid a conflict of interest it is necessary to make a clear distinction between conformity assessment (which takes place before the product is placed on the market) and market surveillance (which takes place after the product has been placed on the market). As an exception, where a notified body and a market surveillance authority come under the same superior authority in a Member State, the lines of responsibility should be so organized that there is no conflict of interest between these activities.
New
Approach directives and the Directive on general product safety
|
The Directive on general product safety applies to consumer products supplied in the course of commercial activity, provided that: the product is not covered by New Approach directives or other Community legislation; or all aspects of safety or categories of risk are not covered by New Approach directives or other Community legislation. |
The Directive on general product safety requires manufacturers to place only safe products on the market. They are obliged, within the limits of their respective activities, to provide consumers with the relevant information to enable them to assess the risks inherent in a product, where such risks are not immediately obvious without adequate warnings, and to take precautions against those risks. They are also obliged to adopt measures commensurate with the characteristics of the product in order to be informed of possible risks, and to take appropriate action including, if necessary, withdrawing the product from the market.
The Directive on general product safety (92/59/EEC) aims to ensure that consumer products placed on the market do not present a risk under conditions of use that are normal or can be reasonably foreseen. It requires producers to place only safe products on the market, and to inform about risks. It also obliges Member States to survey products on the market, and to inform the Commission about actions taken through either a safeguard clause procedure or the information system for serious and immediate risks. The Directive on general product safety covers new, used and reconditioned products intended for consumers or likely to be used by consumers, supplied in the course of commercial activity. According to this definition, products within the scope of several New Approach directives are to be considered as consumer products (such as toys, recreational craft, refrigeration appliances, and to certain extent electrical equipment, gas appliances, machinery, personal protective equipment and pressure equipment).
The Directive on general product safety is applicable insofar as there are no specific provisions in rules of Community law governing all the safety aspects of the products concerned. Further, where specific rules of Community law contain provisions governing only certain aspects of product safety or categories of risk for the product concerned, these provisions are applicable to the products in question with regard to the relevant safety aspects or risks. This rule gives priority to the application of New Approach directives for all aspects of product safety and categories of risk they cover. Further, for products covered by New Approach directives the objective has been to cover all foreseeable risks, if necessary by means of simultaneous application of these directives and other relevant provisions of Community legislation
New Approach directives and the Directive on product liability
|
The Directive on product liability is applicable to all products covered by New Approach directives. |
The objective of New Approach directives is to protect the public interest (for example health and safety of persons, consumer protection, protection of business transactions, environmental protection). Thus, they intend to prevent, as far as possible, the placing on the market and putting into service of unsafe or otherwise non-compliant products. The Directive on product liability (85/374/EEC), which is applicable to all products covered by New Approach directives, provides a powerful incentive to guarantee the safety of products. It is in the interest of the manufacturer, the importer and the distributor to supply safe products in order to avoid the costs that liability places on them for defective products causing damages to individual or property. Consequently, New Approach directives and the Directive on product liability are complementary elements in ensuring an adequate level of protection.
World Trade G/TBT/W/63
7 April 1998
Organization
(98-1401)
Original: English
Committee on Technical Barriers to Trade
CONFORMITY ASSESSMENT PROCEDURES: SUPPLIER’S DECLARATION OF CONFORMITY
Contribution from the United States
I. INTRODUCTION
1. In the first Triennial Review of the Operation and Implementation of
the Agreement on Technical Barriers to Trade (G/TBT/5), the Committee
noted the growing concern with respect to the restrictive effect on trade
of multiple testing and conformity assessment procedures, and that the
principle of “one standard, one test” and if required “one
certification, one time” should be pursued to facilitate trade and
reduce costs (Para. 26). The Committee recognized the supplier’s
declaration of conformity as saving costs associated with assuring
conformance. At the same time the Committee acknowledged this procedure
was not appropriate in all cases, particularly where technical
infrastructure was lacking or it would compromise health, safety or
environmental protections. The Committee agreed that it would be useful
for Members to exchange information on their experience in the various
types of conformity assessment procedures and their conditions of
application. The following submission by the United States is intended to
provide additional background on the use of suppliers’ declaration of
conformity as well as information on the US experience.
II. USE OF SUPPLIER’S DECLARATION OF CONFORMITY AS A TOOL FOR
DEMONSTRATING PRODUCT CONFORMITY
2. A supplier’s declaration of conformity is but one tool for indicating
the conformity of a product, process or service to a standard or technical
regulation. It is a procedure by which a supplier (as defined in ISO/IEC
Guide 22:1996, a supplier is the party that supplies the product, process
or service and may be a manufacturer, distributor, importer, assembler,
service organization, etc.) provides written assurance of conformity to
the specified requirements. The declaration identifies the party
responsible for making the declaration of conformity and for the
conformity of the product/process/service itself.
III. HOW DOES IT WORK?
3. A purchaser or government authority may rely upon a declaration of
conformity as an assurance that a product, process or service complies
with a particular standards or technical regulation. As stated in ISO/IEC
Guide 22:1996 (General Criteria for Supplier’s Declaration of
Conformity), “the declaration normally has the form of a separate
document. It may alternatively be given in, for example, a statement,
catalogue, invoice, or user’s instructions relevant to the product,
process or service.” The supplier makes such a declaration based on: (1)
the manufacturer’s confidence in the quality control system, or (2) the
results of testing or inspection the manufacturer undertakes or authorizes
others to undertake on his/her behalf. ISO/IEC Guide 22:1996 lays out
criteria for supplier’s declaration of conformity. According to Guide
22, the manufacturer has the option of using an accredited laboratory or
inspection body and indicating this on the declaration; this is not a
requirement. The choice of where to test is left to the manufacturer. This
approach allows manufacturers to use laboratories in whom they have
confidence and which are most conveniently located in relation to where
the product is produced, reducing the cost and time associated with
testing. For regulatory purposes, authorities can ensure that the
integrity of a supplier’s declaration of conformity is maintained by
establishing requirements for who signs the declaration of conformity,
requiring access to the declaration and/or compliance records, etc.
IV. US EXPERIENCE
4. In the United States, reliance on a declaration of conformity is most
prevalent with respect to assuring conformity to voluntary standards
(e.g., telecommunications interoperability). A number of US regulatory
agencies also rely upon a declaration of conformity to technical
regulations. The US Department of Transportation, for example, recognizes
a declaration of conformity by manufacturers (or importers) of motor
vehicles and motor vehicle equipment. Under US law, manufacturers are
required to certify that their products comply with all applicable Federal
Motor Vehicle Safety Standards (FMVSS). This certification is in the form
of a permanent label affixed to the product. This label is required for
all vehicles and equipment covered by the FMVSS, and must be present if a
vehicle or equipment covered by the FMVSS is to enter the United States.
For purposes of enforcement, the Department of Transportation’s National
Highway Traffic Safety Administration (NHTSA) may test the vehicle or
equipment for compliance with one or more of the FMVSS after the product
is on the market. If the product fails the test, and either the
manufacturer or NHTSA determines that the product, in fact, does not
comply, the manufacturer must notify the product’s owner and remedy the
noncompliance at no cost to the owner. Additional penalties may apply. A
manufacturer outside the United States who offers its product for
importation into the US must submit itself to the jurisdiction of Federal
courts in the US by designating an agent in the United States who will
receive legal papers on behalf of the manufacturer.
5. The US Federal Communications Commission has adopted a rule which
permits recognition of supplier’s declaration for personal computers
(PC’s) and PC peripherals, provided supporting test results are obtained
from an accredited laboratory (both accreditation programmes cited in the
rule conform to ISO/IEC Guides 58 and 25). This programme benefits
manufacturers in two ways -- by reducing costs and time to market -- while
maintaining a high level of protection of health and safety. We are aware
that other Members also rely on supplier’s declaration as a
demonstration of conformity to regulatory requirements.
6. An effective market surveillance system is an essential underpinning to
reliance on supplier’s declaration. Another factor which may be relevant
to the willingness of regulators to rely on supplier’s declaration is
the extent to which national laws regarding manufacturers’ liability
supplement (or do not supplement) efforts by a regulatory agency to assure
compliance with regulatory requirements. In addition, a regulator may
believe that a different approach to conformity assessment is necessary
for confidence that the product/process/service fulfils the technical
regulation.
7. In the United States, laws on mandatory information disclosure between
seller and buyer and consumer education/information programmes are also
important mechanisms supporting reliance on supplier’s declaration of
conformity. For example, the Fair Packaging and Labeling Act and similar
Federal/state legislation provide manufacturers with flexibility in labeling
and advertising conformity of their products to standards and
requirements established by the manufacturers themselves. Such legislation
can help promote product innovation and improvements and can be an
alternative to imposing mandatory product requirements. It also allows
consumers the freedom to select products which have the characteristics
that they (not the regulator) deem important, while at the same time
protects the consumer from false or misleading labeling or advertising.
This approach can reduce the need for more intrusive regulatory
interference in the marketplace. It should be noted that this approach
alone may not be appropriate for characteristics which may impose serious
health or safety risks.
V. IMPACT ON TRADE
8. Reliance upon a declaration of conformity by suppliers is normally
considered to be a trade friendly approach to conformity assurance. As
noted above, from a manufacturer’s perspective, the supplier’s
declaration of conformity allows flexibility in the choice of location to
have a product tested, reduces the uncertainty associated with mandatory
testing by designated laboratories based in foreign countries as well as
associated costs. Reliance on a supplier’s declaration of conformity can
also be a cost-saving and efficient tool for regulators to meet their
legitimate policy objectives, such as ensuring protection of the
environment and the health and safety of consumers. It can provide an
assurance that a product conforms to regulatory requirements by
identifying an accountable party in the event that non-compliance is
detected. Regulatory reliance on a declaration of conformity can be
enhanced when “spot checks” are conducted and penalties are imposed
for non-compliance. Additional safeguards can be provided by customs
inspections to verify the presence of the supplier’s declaration of
conformity documents and by affording an opportunity for market
participants to inform regulatory authorities of perceived
non-conformance. A supplier’s declaration of conformity is also
beneficial in that there is no discrimination on the basis of the
geographic location of a testing or other conformity assessment body --
conformity is, in short, the responsibility of the supplier. Under such a
system, the question of “portability” of conformity assessment, or of
the need to negotiate political agreements on mutual recognition, become
moot.
VI. FUTURE WORK
9. The Committee on Technical Barriers to Trade has acknowledged the
importance of avoiding unnecessary obstacles to international trade in
cases where a positive assurance of conformity with a technical regulation
or standard is required. While the Committee has noted that the
supplier’s declaration of conformity can save costs, it also
acknowledged that such an approach to conformity assurance may not always
be appropriate. The United States continues to support the voluntary
exchange of information foreseen in the Triennial Review on the use of
supplier’s declaration and alternative approaches to conformity
assessment and would welcome information from other Members on their
experience. Such experience could include a further definition of the
conditions supporting effective use of a declaration of conformity;
considerations that may deem such an approach inappropriate from a
regulatory perspective; an identification of technical infrastructure
components which would be necessary to support reliance on this approach.
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