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Rod Freeman Partner, Product Liability 5 December 2006

British Institute of International and Comparative Law “ 'Reviewing the Review: the European Commission's Third Review of the Product Liability Directive.' ” Outstanding issues, and a look to the future . Rod Freeman Partner, Product Liability 5 December 2006.

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Rod Freeman Partner, Product Liability 5 December 2006

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  1. British Institute of International and Comparative Law“'Reviewing the Review: the European Commission's Third Review of the Product Liability Directive.'” Outstanding issues, and a look to the future Rod Freeman Partner, Product Liability 5 December 2006

  2. Background to the 3rd Report – the Lovells Study • Survey of the practical operation of product liability systems in the EU • Covered all (15) Member States • Input from all operators, including government representatives, producers, distributors, consumer groups, academics and lawyers

  3. Participants in the four categories Producers Insurers 68 168 85 28 Legal Consumer Representatives The Lovells Report

  4. Responses from Member States PRT ESP SWE NE LUX ITA UK IRL GR AT GER BE DK FI FR Austria 15 Belgium 11 Denmark 15 Finland 22 France 22 Germany 65 Greece 12 Ireland 10 Italy 20 Luxembourg 8 Netherlands 26 Portugal 19 Spain 14 Sweden 11 UK 74 The Lovells Report

  5. increased a little 55% 22% 22% no change greatly increased 1% decreased The Lovells Report – key findings • Product liability claims are on the increase Extent to which product liability claims have increased in past 10 years

  6. 76% Consumer awareness of rights 64% Media activity Greater access to information 53% Greater access to legal assistance 43% 37% Awareness of claims abroad (eg US) Judicial attitudes to claims 27% 26% Advertising by lawyers 25% Implementation of the Directive 18% Changes in other substantive laws 14% Changes to regulatory environment 10 % Changes in court procedures 3 % Deterioration in safety products The Lovells Report – key findings Factors leading to increase

  7. Consumers Producers a great deal a little not at all 20% 38% 53% 62% 27% a little a great deal Insurers Legal not at all a little not at all a great deal 10% 8% 16% 63% 74% 29% a little a great deal The Lovells Report – key findings 2. Product liability risks differ between Member States

  8. Overall strikes an appropriate balance 66% does not adequately 16% protect consumers does not adequately 14% protect producers does not protect either 4% adequately Consumers Producers strikes an appropriate strikes an appropriate 20% balance balance 66% does not adequately does not adequately 3% protect consumers protect consumers 80% does not adequately does not adequately 26% protect producers protect producers does not protect either does not protect either 5% adequately adequately Insurers Legal strikes an appropriate strikes an appropriate balance balance 86% 63% does not adequately does not adequately 7% 27% protect consumers protect consumers does not adequately does not adequately 5% 6% protect producers protect producers does not protect either does not protect either 2% 4% adequately adequately The Lovells Report – key findings 3. Overall, there is a high level of acceptance of the Directive, which is generally regarded as striking an appropriate balance

  9. The Lovells Report – key findings 4. No obvious case for fundamental reform • The Commission should monitor developments • The Directive as part of a wider, dynamic scheme

  10. The Fondazione Roselli Report • The development risks defence performs an important economic function, and it should not be removed • A compensation scheme for those injured by “development risks” should be considered

  11. Product liability in the EU – where are we now, where are we going? Reform off the agenda? not quite….

  12. Product liability in the EU – where are we now, where are we going? The concept of “defect” • Foster v Biosil/Richardson v LRC Products • A v National Blood Authority/Bogle v McDonalds

  13. Product liability in the EU – where are we now, where are we going? The development risks defence • Advocate-General in European Commission v UK • A v National Blood Authority A worthless defence? Perhaps not: • French “Pentasar” case (September 2004) • Italian blood products case (April 2006)

  14. Product liability in the EU – where are we now, where are we going? Defence of regulatory compliance? Kitchen Stove, Case (1998) Swiss Elevator case (2004) Pollard v Tesco Stores (2006)

  15. The future? • Ongoing monitoring by the Commission • Changes in the broader liability environment • Procedural reforms? • Regulatory reforms • Development of experience with GPSD • REACH

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