China formally submitted a comment expressing concern about the proposed EU regulation that would require all manufacturers and distributors outside of Europe who sell products into Europe to have a designated EU party that is responsible for product compliance. The European Union has now provided a response to the comment.
The China comment highlighted the complexity of current supply chains and sales distribution models, the importance of e-commerce and the challenge posed (especially to SMEs) of requiring all sellers into the EU to designate a local party for product compliance. Furthermore, the China comment suggests that some of the disclosure requirements (information about the distribution chain and the product) may violate confidential business information. Overall, China recommends striking and amending several of the new requirements in the proposal.
In its response, the European Union stated:
“The EU carefully considered the various options to reduce the number of non-compliant products sold in the EU, in order to facilitate global supply chains without compromising on consumer safety and other requirements of public interest. The establishment of more complex or new supply chains with an increasing variety of actors should neither come at the detriment of product safety and compliance, nor should it restrict the possibility to enforce product safety and compliance requirements. The inclusion of the provision for a person responsible for compliance information was the most effective and proportionate way to achieve these policy objectives while avoiding unnecessary restrictions to trade.
The EU would like to highlight that this provision reinforces the capacity of manufacturers to communicate with market surveillance authorities.”
To address the issue that the distribution chain may be confidential information, the EU responded definitively:
“The identity of the person responsible for compliance information (which can be a legal or a natural person, at the choice of the manufacturer) cannot constitute a trade secret.”
The China comment expressed concern that the new requirements gave too much authority to enforcement bodies, implying that the enforcement bodies would abuse the information power that they are given. This implication was not well received by the EU who (politely) responded that manufacturers and importers are already legally required to provide most of this information as technical documentation under existing regulations and that powers of enforcement are well controlled:
“The EU would like to highlight that paragraph 5 of Article 14 of the notified proposal explicitly provides that the powers of market surveillance authorities must be exercised in accordance with the principle of proportionality.”
Bottom line…. The EU thanked the Chinese for their comments but did not indicated that they would not be implementing any of the suggestions.
For the reasons specified above, the EU considers that the notified proposal is not more trade-restrictive than necessary to fulfil its legitimate policy objectives, also taking account of the risks that non-fulfilment would create. It therefore fully complies with the provisions of the TBT Agreement.
The China comment and the EU reply (along with the original posting of the proposal) are available on the EU TBT portal.
Impact to EEE Manufacturers
The EU reply suggests that they intend to follow through with the proposed rules and procedures for compliance. EEE Manufacturers that sell products into the EU via local importers and distributers should may not only see a few additional paperwork requirements for paperwork; however, manufacturers that sell directly to end customers in the EU will need to delegate a local authority for compliance purposes.