What are the likely future developments in product liability law and practice? To what extent is the suitability of the law being challenged by advances in technology?
On January 2018, the Ministry of Consumer Affairs, Food and Public Distribution introduced the Consumer Protection Bill, 2018 (CPB 2018) in the Lok Sabha (the lower house of the Indian Parliament). The CPB 2018 was passed in the Lok Sabha on December 2018 but is yet to be passed in the Rajya Sabha (the upper house of the Indian Parliament) and notified as law. The CPB 2018 defines product liability to mean a product manufacturer's or seller's responsibility towards compensating a consumer harmed by a defective product or deficiency in service. The salient features of the CPB 2018 include introducing provisions relating to product liability, enhanced penalties and establishment of the Central Consumer Protection Authority (CCPA) (a regulatory agency with wide powers to address consumers’ concerns) to promote, protect, and enforce rights of consumers as a class. The CCPA’s powers will include (a) enquiring and conducting investigations into violations of consumers’ rights, (b) order of recall of products found to be unsafe or withdrawal of services found to be unsafe or hazardous, (c) imposing penalties, and (d) issuing safety notices and alerting consumers to unsafe goods or services. The CPB 2018 also includes provisions that make the manufacturer liable for product liability actions in certain cases, and lists out instances where a product manufacturer or seller will not be held accountable for product liability.
To keep up with changing times and the advancement of technology, legislators and the judiciary are continuously attempting to keep Indian laws updated; however, it remains challenged by the rapid pace at which technology is progressing. In situations where processes are increasingly being automated, such as 3D printing and driverless cars, the existing principles of product liability in India are not sufficiently evolved to identify and apportion liability in cases involving human and machine error. The issue of liability is even less clear in situations where the involvement of a human element reduces and important decisions are taken by artificial intelligence systems.
Product liability for autonomous vehicles (vehicles with driving assist system) is likely to be a problem in future product liability law and practice, due to advances in technology. Until now, in a car traffic accident, the victim usually will make a claim for damages against the other party in the accident (or the insurance company of the other party). However, as the number of autonomous vehicles become widespread in the future, depending on the level of the auto-drive, it may be difficult to pursue tort liability against the “driver” of the vehicle that injures the victim, and the insurance company may claim for damages against the manufacturer in subrogation of the victim under the PLA. In such cases, the product liability of autonomous vehicles manufacturers and manufacturers of ITS devices, etc. could become problematic.
The manufacturers providing the so-called Level 1 or more autonomous vehicles should include appropriate explanations and warnings to the purchaser in the instruction manual, including the functional limitations of the vehicle, and should consider ensuring that direct explanations by the dealer are thoroughly carried out in an easy-to-understand manner using simulators, etc.
Recently, the Ministry of Commerce attaches great importance to product liability and product safety. In this respect, there is a draft of a new product safety regulation with is expected to come out very soon. This regulation which includes provisions for follow-up of products more stringent in terms of product safety and which also brings important innovations in the digitalization of products and services.
As the digitalization process is quite fast, it will be the most challenging situation for existing regulations to remain behind this technology. It is obvious that the damages and other administrative arrangements caused by digitalized products and services will have difficulty in catching the day.
In recent years, there were several cases that received national attention which highlighted the difficulty of proving a causal relationship between a defect in a product and the damages suffered by an injured consumer. As many claimants were denied compensation as a result of such difficulty, there was a push for amending the relevant laws to alleviate this burden of proof. As a result, the Product Liability Act was amended and there has been more public discussion regarding additional amendments to the Product Liability Act including the introduction of class action in product liability litigation cases. It will be interesting to see if any further legislative developments take place to this effect.
In recent times Australia has witnessed the commencement of multiple class actions in a range of industry sectors and products and services. Another increasing trend is the increasing number of competing class actions that have been commenced. Multiple claimant law firms will commence overlapping class action claims. While there have been a number of cases on this latter point.
The other area of keen interest is common fund applications which have been received by the Courts with varying results. In February 2019 challenges were brought against common funds in both the Full Federal Court and the New South Wales Court of Appeal on a number of grounds - including that they were unconstitutional. Both challenges were unsuccessful, and therefore unless the results are successfully appealed to the High Court of Australia, common funds appear to be here to stay.
Electronic trials utilising new technologies are now increasingly the default position in Federal and State Courts. E-trial providers are delivering highly sophisticated services, both in and out of the Courtroom. Australia is also starting to see discovery orders shaped around new technology available for searching documents, such as text searching for particular phrases. To assist parties in relation to the use of technology in Court proceedings, a General Practice Note - Technology and the Court (GPN-TECH) - was published by the Federal Court of Australia in October 2016. The purpose of the Practice Note is to facilitate the effective use of technology in the preparation for and at all stages of a proceeding, as well as to assist parties in the use of technology within the Court.
The landscape of product liability is undoubtedly changing and developing, including through the impulse of advances in technology.
Consumers are increasingly linked together through social media. As such, information spreads between consumers and stakeholders at an increased speed and on a larger scale.
The European Commission has announced that in mid-2019, it “will issue […] a report on the broader implications for, potential gaps in and orientations for, the liability and safety frameworks for artificial intelligence, the Internet of Things and robotics”.
The first likely future development consists in the use of artificial technology to increase the number of product-liability lawsuits, especially considering that the particularities between the cases may be similar in several cases.
Considering that the Consumer Protection Code is a principle law and it is relatively new law (in force since the 90’s) it has duly responded to the advances in technology. However, depending on the modifications brought by the technology and its impacts in the product liability matters, the law will have to be modified.
The rapid development of technology in the 21st Century brings high-tech products and more advanced business models. This in turn calls for a judiciary of more expertise and familiarity in the industry. As mentioned, China has responded to this challenge by establishing courts that specialize in specific fields of business. It is likely that this trend would continue in the upcoming future.
Similarly, on the legislative end, we expect to see the distribution of rights and obligations among producer/seller and purchasers to change along with advances in technology. As mentioned under Question 16, the legislators explained that the purpose of reversing burden of proof in the first six months after purchase was that they found it unreasonable to demand consumers to understand the complexity of products of advanced technology. In the future, one could only expect this gap would become wider, and product liability law would have to evolve correspondingly to catch up with the changing reality.
The impact of Brexit has been a key talking point in the UK across many legal areas, including product liability, but it is not yet clear how this will impact claims in the UK. Product liability and safety law is not expected to dramatically change if and when the UK leaves the EU but since much of the UK's law in this area comes from the EU, and the EU is continuously updating its laws inevitably there will be scope for differences in the future.
In planning for Brexit, the UK government has drafted a statutory instrument amending UK product liability and safety laws which has been put before Parliament for approval. The 'Product Safety and Metrology etc. (Amendment etc.) (EU Exit) Regulations 2019' (the "SI"), if and when approved, aims to ensure that current EU requirements relating to product liability and safety, as implemented into UK law, are amended in a manner which will apply to products on the market in the UK once the UK is no longer in the EU.
More broadly, rapidly developing technology is having an impact on product liability law. For example, as mentioned in the introductory chapter, the EU is currently considering whether to update the PLD. Key proposals include a change to the definition of "defective" product and whether it should remain incumbent on the claimant to show the link between damage and the defect of a product.
We see the likely future developments in product liability law and practice in the effects of automation and digitalization of products. New legal challenges arise in particular where products and cars are connected and interact with other products. This creates new questions, for example, who is responsible for a failure of a product (the product itself?) and which are the effects of automation on the product monitoring obligations of manufacturers.
Products liability law and practice will continue to grow and refine with technological developments. These developments will have a significant impact on the future of products liability law and require courts to grapple with many issues and scenarios that are unique. One example that comes to mind is self-driving cars. While these issues will requires courts to make many first impression decisions on issues, it is unlikely to upend the sustainability of products liability litigation. In addition, jury trials will be different because it will be difficult to explain these more complex, autonomous advancements to jurors.
The attention to product liability, including possible contribution claims, is likely to continue. The advances in technology will probably cause new and complex product liability disputes. Moreover, there seems to be increased focus on product liability in connection with the provision of services.
It cannot be excluded that Brexit in the long term may have an impact on the Danish Products Liability Act and the product liability rules developed in case law.
There will probably be more complicated product liability disputes due to the advances in technology, including cases of a precedent-setting nature in the Supreme Court.
The Danish Administration of Justice Act allows the possibility of obtaining permission from the court, if both parties agree and as a supplement to the court-appointed expert, to produce statements on matters of a technical nature obtained from experts by each party. In step with the technological developments, which make matters more complex, this opportunity is likely to be exercised more in future.
There were no recent precedents able to substantially reshape product liability legislation in Russia. Nevertheless, the President’s Council on codification of legislation plans to work on the amendments to the Second Part of the Russian Civil Code, which contains provisions on tortious claims and product liability claims.
Regarding trends, the number of product liability claims is increasing. Many of the claims have started to involve the automotive industry.
Also in 2018 the bill on regulating the activity of so called aggregators (taxi services, rental services, cleaning services, etc.) was submitted by the Government to the Parliament and is currently being considered.
As of today we do not expect major changes regarding the handling of product liability cases in the near future. In the medium and long term future the technical advances will make it easier for large numbers of claimants to file their claims. The use of certain technical applications will be necessary for handling those large numbers of claims. As of today Austria’s court system could become clogged, if it were flooded by huge numbers of similar claims.