EU – Adopts New Market Surveillance Regulation

The European Commission published Regulation 2019/1020 on market surveillance and enforcement which includes new obligations for manufacturers and sellers who are located outside the EU and sell directly to end-users. China had submitted comments on the WTO TBT notification in mid-2018 expressing concern about the proposed regulation and its impact on Chinese businesses selling into the EU. The new requirements take effect starting July 16, 2021.

The regulation was developed in response to a high rate of product non-compliances identified over the past few years, including lack of accountability with internet sales. It tightens responsibility for product compliance by ensuring that all products sold to users in the EU have an EU entity that is legally responsible.  The regulation covers products that are subject to a broad range of regulations including the RoHS Directive, REACH regulation, low voltage Directive, EMC Directive, and Eco-design Directive.

The new regulation is officially titled REGULATION (EU) 2019/1020 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 20 June 2019 on market surveillance and compliance of products and amending Directive 2004/42/EC and Regulations (EC) No 765/2008 and (EU) No 305/2011. It is available for download from the Europa website.

In a nutshell, manufacturers and sellers outside the EU are required to designate a party within the EU to be responsible for product compliance and for performing compliance tasks.  This regulation is applicable to a broad range of Directives and regulations, including the EU RoHS Directive which puts nearly all EEE within its scope.

The regulation also puts more responsibility for compliance checks on customs authorities and mandates coordination between EU member state enforcement authorities so that information about a non-compliance found in one country is available to all countries.

Tasks of Economic Operators

Chapter II, Article 4 specifies the need for and obligations of economic operators. Paragraph 2 defines the economic operator:

    1. For the purposes of this Article, the economic operator referred to in paragraph 1 means any of the following:

(a) a manufacturer established in the Union;

(b) an importer, where the manufacturer is not established in the Union;

(c) an authorised representative who has a written mandate from the manufacturer designating the authorised representative to perform the tasks set out in paragraph 3 on the manufacturer’s behalf;

(d) a fulfilment service provider established in the Union with respect to the products it handles, where no other economic operator as mentioned in points (a), (b) and (c) is established in the Union.

Paragraphs 3 and 4 describe the obligations of economic operators.

Obligations of the Manufacturer

The manufacturer is required to contract with and mandate the EU-based Authorized Representative to perform the tasks listed in the regulation. The Authorized Representative must also be given the means to fulfil their tasks and they “shall provide a copy of the mandate to the market surveillance authorities upon request, in a Union language determined by the market surveillance authority”.

Distance Sales

The regulation very specifically closes a previous enforcement gap with distance sellers. Article 6 on Distance sales states: “Products offered for sale online or through other means of distance sales shall be deemed to be made available on the market if the offer is targeted at end users in the Union. An offer for sale shall be considered to be targeted at end users in the Union if the relevant economic operator directs, by any means, its activities to a Member State.” The reference to “…targeted at end users in the Union” means that the obligation takes effect as soon as someone tries to sell a product in the EU – for example, this could be via a website that supports EU languages or allows the user to select shipping destinations in the EU.  Enforcement is possible even before a sale is made.

Internet Sellers and Internet Service Providers

The regulation requires Information/Internet service providers to cooperate with the market surveillance authorities and, in certain cases, to mitigate risks presented by a product.  For example, this could require selling sites to remove products or sellers.

Market Surveillance Authorities

Articles 10 to 34 of the regulation focus on the operation, powers and limitations of the market surveillance authorities. It also states the procedural rights of economic operators. A market surveillance authority in one country is also required to notify other EU member states via the Rapid Information Exchange System of any serious risks that are identified.

Article 25 puts specific emphasis on European customs authorities as having the powers and resources for enforcement. This was done to ensure that products that do not have the necessary information about an Authorized Representative can be stopped before they clear customs and are available for free movement within the EU.

International Cooperation

Article 35 of the regulation allows the Commission to “cooperate with and exchange market surveillance related information with regulatory authorities” of non-EU countries and organizations.  This information could be used, for example, to coordinate product recalls.

Recovery of costs by market surveillance authorities

Article 15 gives member states the authority for “market surveillance authorities to reclaim from the relevant economic operator the totality of the costs of their activities with respect to instances of non-compliance”. This may include the cost of testing products.

Entry into Force

Article 44 states that the requirements applicable to economic operators apply as of July 16, 2021.

[1] EU market surveillance regulation,