The European Union has just published the recently adopted new rules of liability for defective products or so-called product liability.

Product liability, in a very small nutshell, is the liability of manufacturers or importers when their consumers are harmed by defective goods. Product liability is very relevant for manufacturers and importers selling all kinds of consumer goods, whether automobiles or toasters. If the consumer is shocked by a hairdryer, its manufacturer or importer may have to pay the consumer’s hospital bills.

The new directive was created to update the one that has been in effect for nearly four decades, with the goal of catching up to the emerging technologies that are continuously posing new challenges to manufacturers and consumers alike. The appearance of technologies such as digital manufacturing, autonomous vehicles, and AI generally, requires reaction of the legislators.

With the new concept the EU aims to better support consumers in claiming compensation for damages suffered because of defective products. A few novelties:

• the consumers can now claim compensation for medically recognised damage to psychological health, and they will be able to do so within 25 years
• consumers may now get compensated for destruction or corruption of data
• providers of online platforms will be held liable where no EU-based business can be identified in the supply chain
• it will be easier for consumers to prove that the product they bought is defective

Hungary (just like all other member states) has 2 years to implement the new rules. The new rules will only apply to products that will be placed on the market after 2 years from now.

For more information, please contact our experts Renáta Papp (pappr@vjt-partners.com) and András Lovretity (lovretitya@vjt-partners.com).