Comparing Consumer Product Safety Law for New Markets and Technologies

In the context of changes in the consumer marketplace and regulatory frameworks locally and internationally, the Australian government is re-initiating public consultations about introducing an EU-style “General Safety Provision”. Although this requirement for suppliers pro-actively assess risks and put or keep only safe products products has also been introduced beyond Europe in Hong Kong, Macau, Malaysia and (partly) Singapore, it has also not yet been introduced in Japan. However, Japan may have a better regulatory framework in other respects (eg mandatory accident reporting requirements on suppliers that extend to some “near misses”, along with public disclosure of such reports) and better enforcement (eg of mandatory safety standards for specific products).

Japanese courts also continue to generate more case law applying EU-style strict product liability, introduced by a 1994 Act, compared to an analogue introduced in 1992 in Australia (and increasingly in other parts of Asia, including many ASEAN states). This helps promote and clarify more indirect incentives on suppliers to source and provide safe products. However, such impact for product liability litigation is still constrained by issues such as effective access to justice / courts. This is evident from a recent book examining major EU and some other countries, reviewed below for the Journal of European Tort Law: Piotr Machnikowski (ed) European Product Liability: An Analysis of the State of the Art in the Era of New Technologies (Intersentia, Cambridge, 2016, ISBN 978-1-78068-398-0, ix+705pp):

This is a very useful reference book especially for academic researchers and legal practitioners, but also policy-makers or law reformers, as it compares product liability law and practice across 12 countries in Europe as well as five other countries. A key question is whether the 1985 product liability (PL) Directive (85/374/EEC), compensating consumers for physical harm as well as certain consequential property losses caused by product safety defects, remains “fit for purpose” – especially given the proliferation of new technologies.

The Introduction by Machnikowski succinctly outlines those as including: mobile internet (smartphones, tablets etc), the automation of knowledge work, the “internet of things” (such as connected home appliances), cloud technology, advanced robotics, autonomous vehicles, next-generation genomics and regenerative medicine, advanced materials (eg through nanotechnology), energy storage, advanced oil and gas exploration and recovery, renewable energy sources, and 3D printing (pp3-8). He explains how these technologies require us to reconceptualise the role of substantive private law, as they often have global reach and prompt calls for public regulation. The new technologies also strain the capacity of the legal system to respond quickly and effectively. They often implicate intellectual property and services rather htan movable or tangible products, and networks of suppliers rather than just manufacturers and some specified intermediaries, as primarily envisaged by the PL Directive. The new technologies raise questions about its focus on product defects linked to physical safety (rather than infringements of privacy or non-economic rights and interests), the exemption from liability usually provided for “development risks” (the no-one-could-have-known defence), attributing causation, and the scope of (potentially catastrophic) damages claimable. The book therefore aims to analyse how conventional PL law is or could be addressing such questions, as well as how PL law interacts with other areas of tort law and public regulation (pp 8-13).

The volume compares the law of European Union member states selected from both the “Old” and “New” Europe (Austria**, the Czech Republic, Denmark*, England*, France**, Germany**, Italy*, the Netherlands*, Norway*, Poland and Spain) and the European Economic Area (Norway) as well as Switzerland. It therefore reviews legal systems in the “Roman, German, common law and Nordic traditions”, along with “two important common law traditions from outside Europe (USA** and Canada*) as well as two mixed jurisdictions (Israel* and South Africa” (pp 13-14). The back cover blurb adds that this hefty book “is the result of an extensive international research project funded by the Polish National Science Centre. It brings together experienced scholars associated with the European Group on Tort law (EGTL) and the European Research Group on Existing EC Private Law (Acquis Group) … The country reports show that the practical significance of product liability differs widely in the various Member States”.

The preceding paragraph above tries to give a sense of this variable significance of PL law by indicating with an asterix (*) or double asterix (**) those countries where there is respectively extensive or very extensive litigation and case law; those without any asterix are countries where lawsuits reportedly remain rare. This rough appraisal is derived mainly from each country report’s concluding Part X (Assessment of Domestic Law), except for the chapter on Spain (lacking Part X), as well as each chapter’s respective Part IX (Alternative Regulations and Remedies) and Part VIII (Procedural and Evidential Issues). The comparison reinforces the well-established general proposition that it is factors beyond reforms to substantive PL law, even the shift from negligence-based to strict liability under the 1985 Directive model (inspired by some earlier US case law), which primarily generate lawsuits and therefore case law that might offer more guidance on what constitutes appropriate safety for consumer products.[1]

The country reports identify (sometimes overlapping) factors arguably impacting on whether or not PL law is extensively litigated:

  • effectively enforced public regulation preventing harmful products coming on the market (also in Norway, per Askeland, p 375), and strong social welfare or insurance schemes (eg in Denmark, per Holle and Mogelvang-Hansen, pp 171-2);
  • expenses in accessing evidence, and lawyers open to contingency fees, compared to non-legal dispute resolution avenues (in England, per Oliphant and Wilcox, p 203);
  • linking of civil with criminal proceedings to ease plaintiffs’ evidentiary burden (in France, per Borghetti, p235);[2]
  • scope of claimable damages (with lawsuits under PL Directive implementing legislation only really since a 2002 amendment allowing claims also for pain and suffering in Germany, per Magnus, p 272);
  • reversed burden of proof under still more familiar Civil Code negligence provisions in Italy, per Comande, pp 307-8);
  • quite predictable law (facilitating settlements), business reputation, products (like mobile phones) bundled with services facilitating claims against direct suppliers rather than manufacturers (in the Netherlands, per Keirse – but noting that general tort law has also become stricter: pp 355-6);
  • unpredictability in civil processes and litigation outcomes due to limited legal aid, variability in lawyers’ fees, high litigation costs, the “loser pays principle”, complex and lengthy procedures, problems with experts and judicial methodologies, and unclear standard of proof (p 404, per Baginska);
  • “almost impenetrable” commentary with very limited case law (in Switzerland, per Winiger, pp 477-8);
  • potential claims versus regulators and perhaps related compensation schemes, as well as class actions (in Canada, per Arbour, pp 513-9);
  • no-fault liability schemes precluding personal injury claims for defects in automobiles, and comparative ease of suing actors (eg doctors or employers) than manufacturers of potentially unsafe products (in Israel, per Gilead, p 544).

Each country report also succinctly sets out Parts dealing with “Sources of Law”, “Basic Elements of Liability”, “The Person Liable for Damage”, “The Aggrieved Person and Damage”, “Causality”, “Defences and Exclusions”, and “Remedies”. This structure facilitates easy comparisons on points of interest (eg on the extent to which an intermediate supplier might have contributed sufficiently to be deemed a joint “manufacturer”[3]), although it would have been helpful for the book to add an Index.

Especially for the (many) countries where case law is sparse, the country reporters do not delve into great detail about the potential applicability of especially Directive-based PL law to the various new technologies (but see Austria, per Koch, p 147). However, in his Conclusions, Machinowki nonetheless includes a very interesting analysis that can be seen as challenging the “Adequacy of the European Product Liability Regime for Threats Posed by New Technologies”, focusing on what should now constitute a “product”, “defect”, “development risks”, the “entity liable for composite products”, and appropriate “time limits”, as well as generally the “possible development paths for product liability law” (pp 691-705). Readers familiar with PL law could perhaps begin the book here, at the end. For particular points of interest, they can cross-reference to the detailed and authoritative commentary on the “Product Liability Directive” itself (pp 17-108) co-authored by Fairgrieve, Howells, Machinowski and five others. That will also be essential background reading for those less familiar with PL law. Academics and policy-makers, rather than practitioners, may also find some related insights in the penultimate chapter by Faure, setting out a rather general “Economic Analysis of Product Liability” (pp 619-65).

Overall, this is a very well conceived and executed comparative reference book that can be highly recommended, especially for those interested in PL law in the context of proliferating new technologies. A second edition or companion volume might usefully extend the analysis to other European countries as well as those, especially in the Asian region, that have increasingly adopted the PL Directive approach – often with more pro-plaintiff innovations.[4] However, other than Japan and Australia to some extent, these Asian countries have so far even less case law and related commentary that may help guide them as well in addressing emergent consumer product safety issues.

[1] Matthias Reimann, “Liability for Defective Products at the Beginning of the Twenty-First Century: Emergence of a Worldwide Standards?”, 51 American Journal of Comparative Law, 751-38 (2003). For a recent illustration, showing almost no lawsuits filed in five Southeast Asian countries that have adopted Directive-style PL legislation, except in Thailand thanks to contemporaneous  legislation facilitating consumer claims through regular courts, see Luke Nottage and Sakda Thanitcul, “Economic Integration and Consumer Protection in Southeast Asia: ASEAN Product Liability Law and Safety Regulation” in ibid (eds) ASEAN Product Liability and Consumer Product Safety Law (Winyuchon, Bangkok, 2016), available via

[2] On the synergies between civil and criminal proceedings in medical malpractice and (especially mass tort) PL claims in Japan, see also respectively Robert Leflar, “Medical Error as Reportable Event, as Tort, as Crime: A Transpacific Comparison” 22 Journal of Japanese Law 39-76 (2005) available at; and Luke Nottage, Product Safety and Liability Law in Japan (Routledge, 2004) especially ch3.

[3] See a class action settlement regarding imported soy milk, approved by the Victorian Supreme Court, which might have had otherwise to rule on this point under either Australian or Japanese law (both incorporating variants of the PL Directive since the early 1990s): Erin Downie v Spiral Foods Pty Ltd and Others [2015] VSC 190, available at

[4] See also Luke Nottage, Justin Malbon, Jeannie Paterson and Caron Beaton-Wells, ASEAN Consumer Law Harmonisation and Cooperation (Cambridge University Press, Singapore, 2020) especially ch3; Geraint Howells, Hans Micklitz et al (eds) Consumer Law in Asia (Cambridge University Press, forthcoming 2021).

New Frontiers in International Arbitration for the Asia-Pacific Region (8): Confidentiality vs Transparency in ICArb and ISDS

Confidentiality is still widely seen as significant advantage of international commercial arbitration (ICA) over cross-border litigation, especially perhaps in Asia. This can be seen in rules of most arbitral institutions. Automatic (opt-out) confidentiality is also now found in many national laws, including statutory add-ons to the UNCITRAL Model Law and/or through case law for example in New Zealand, then Hong Kong, Singapore, Malaysia, and eventually Australia.

Yet there remain variations in the timing of these developments as well as the scope and procedures associated with exceptions to confidentiality. There is also no confidentiality provided in Japan’s later adoption of the Model Law, although parties mostly choose the JCAA so opt-in to its Rules, which have somewhat expanded confidentiality obligations since 2014.

Another recent complication is growing public concern over arbitration procedures through (especially treaty-based) investor-state dispute settlement (ISDS), especially in Australia since an ultimately unsuccessful treaty claim by Philip Morris over tobacco plain packaging legislation (2011-15). Statutory amendments in 2018 reverse automatic confidentiality for Australia-seated ISDS arbitrations where the 2014 UNCITRAL Rules on Transparency in Treaty-based Investor-State Arbitration. Concerns over ISDS may impede Australia enacting provisions for confidentiality of arbitration-related court proceedings, which could not be revised recently in New Zealand against the backdrop of its new government’s anti-ISDS stance.

Growing transparency around ISDS arbitration is welcome given greater public interests involved in such cases, but transparency should not be simply transposed into commercial dispute resolution through ICA as the fields are overlapping but distinct. Confidentiality in ICA has the disadvantage of exacerbating information asymmetry, making it harder for clients and advisors to assess whether particular arbitrators and lawyers provide value for money. But confidentiality allows arbitrators in particular to be more robust in proceedings and drafting rulings, thus countering the rise in ICA delays and especially costs. More transparency around ISDS, as well as initiatives like “Arbitrator Intelligence” and experiments in reforming Arbitration Rules (eg recently by the ICC), can help reduce information asymmetry for users anyway, while retaining various advantages of confidentiality particularly in ICA.

My draft paper, presented recently in Rome and for the USydney conference on Friday 15 November, elaborates these tensions between confidentiality and transparency in ICA and ISDS, focusing on Australia and Japan in regional context. Both countries still get few ICA cases but are trying to attract more [see the ABA inquiry report by Roger Gyles QC now available via]. They are taking somewhat different approaches to confidentiality in that field, while negotiating investment treaties that increasingly provide transparency around ISDS arbitration.

Nottage, Luke R., Confidentiality versus Transparency in International Arbitration: Asia-Pacific Tensions and Expectations (August 29, 2019). Sydney Law School Research Paper No. #19/52, August 2019. Available at SSRN: