New EU General Product Safety Regulation to offer more safety for online shoppers and vulnerable consumers

The question

How will the proposed General Product Safety Regulation (GPSR) impact the obligations of providers of online marketplaces?

The key takeaway

The proposed GPSR will overhaul the general legal framework around product safety by addressing potential safety issues associated with new technologies sold on the online marketplace. This includes increased obligations on providers of online marketplaces to facilitate communication with consumers regarding concerns they may have surrounding product safety issues as well as giving more power to authorities so they can take swift action in removing dangerous goods from the market place. 

The background

On 28 November 2022, the EU Parliament and EU Council agreed to update existing product safety rules relating to non-food consumer products. This political Provisional Agreement was further supported on 24 January 2023 by the Internal Market and Consumer Protection Committee, thus paving the road for a more harmonised system which may be implemented by all EU states across the board. 

If the new proposal is agreed by the EU Parliament, the existing General Product Safety Directive would be transmuted into a Regulation. The vote is expected to take place in March 2023. The proposal for the new GPSR targets rules surrounding the safety of non-food consumer products with a particular focus on protecting online shoppers. 

The development

The proposed regulation is expected to contribute significant changes to online marketplaces with several provisions under Article 20 of the draft GPSR expected to bolster buyer confidence when purchasing goods online. In summary:

• Providers of an online marketplace must provide a single point of contact which consumers and national surveillance authorities may contact electronically to voice concerns in relation to product safety issues.
• Providers must inform their consumers regarding the available interfaces of communication (eg email, webchat etc).
• Providers must communicate their business’ basic information as well as information relating to the products they are selling.
• Providers must use the Safety Gate Portal to communicate with the authorities in relation to issues concerning product safety.
• Providers must cooperate with market surveillance authorities especially where the removal of dangerous products is concerned.
• Providers must take reasonable measures to conduct random checks for dangerous products.
• National authorities will be given the power to disable access to and/or remove dangerous content from online marketplaces without undue delay/within two working days.

Furthermore, the proposals under Articles 31-35 provide increased buyer protection by solidifying a consumer’s right to information and remedies, which seeks to protect vulnerable consumers in particular, such as those with disabilities. These include:

• Providers must clarify information surrounding a consumer’s right to repair, replacement, or an adequate refund.
• Consumers will be entitled to file complaints.
• Consumers will be entitled to launch collective actions.

The draft GPSR is now in its final stage and is therefore ready to be debated in March 2023 by the EU Parliament and the EU Council. Once formally agreed, the Regulation will be published in the EU Official Journal and will enter into force. To note, according to Article 47, the GPSR will only apply 18 months following formal agreement, so enforcement is likely to be effective around late 2024. 

Why is this important?

Despite being in the draft stage, if approved and enforced, the new GPSR is likely to impose significant legal obligations on providers of online marketplaces which may require operational changes to ensure compliance. 

When the General Product Safety Directive was first implemented in 2001, the subsequent amount of buying and selling in the online marketplace was not pre-envisaged. Online sales are notoriously difficult to monitor, which has encouraged the EU regulators to adopt the proposed requirements as a Regulation, thereby increasing cohesive enforcement. Furthermore, although the new rules directly affect EU member states, the EU accounts for 50.4% of all imports in the UK thus allowing UK consumers to benefit from the Regulation vicariously. Separately, the UK is currently carrying out its own review of applicable product safety legislation which will naturally be influenced by developments in Europe. 

Any practical tips?

The GPRS will require significant, long-term changes to online marketplaces, making it important for their operators to start considering its impact now. This includes relatively simple steps like establishing a single point of contact (so there is a clear line of communication between the business, the authorities and consumers) through to more complicated steps such as measures to undertake regular and random safety checks on products and to enable cooperation with national authorities where the safety of a product is questioned. Importantly, consumers must be informed of their rights to repair, refunds and adequate replacement, as well as have the right to file complaints or launch collective actions. 

Spring 2023