Upon the announcement of Mehmet Muş, the Group Deputy Chairman of the Justice and Development Party (AKP), on January 17, 2020, the Proposal on Product Safety and Technical Regulations Law ("Proposal") has been published in the General Assembly's website on January 20, 2020. The Proposal, which will enter into force one (1) year after the date of its publication (in case of being ratified), will be executed by the President.
By entry into force of the Proposal, the existing law on the subject matter, namely the Law numbered 4703 on the Preparation and Implementation of Technical Regulations on Products ("Law") will be abolished. However, the technical regulations issued per the Law will remain in force, until the issuance of the new ones under the Proposal.
The Proposal introduces rules to ensure that products are in safe condition and are in compliance with the technical regulations, determines the principles of market surveillance, duties of public authorities and obligations of economic operators1 and conformity assessment bodies. While the principles and the procedures for placing the products on the market, conformity assessment, market surveillance and inspection have already been regulated with the Law, it is stated in the preamble of the Proposal that considering the developments in the EU regulations2] and because of the needs expressed by the public authorities as well as the developments in e-commerce, the necessity to introduce a new regulation on product safety and technical regulations have arisen.
The Proposal introduces new definitions for "manufacturer", "importer" and "authorized representative", which were all included under the single definition of "producer" in the Law. The Proposal sets forth separate obligations for manufacturers, importers and authorized representatives, as well as for distributors. Moreover, the Proposal makes the distinction between "making available on the market" and "placing on the market" to comply with the definitions to comply with the EU regulations and to emphasize the difference between first making available of a product and subsequent placements. Similarly, the Proposal includes the classification of products based on risk as "product presenting a risk" and "product presenting a serious risk" are provided. Finally, the definition of "distributor" is redefined and the term "economic operator" is introduced in accordance with the EU regulations.
Similar obligations are defined for the Manufacturer (any natural or legal person, who manufactures a product or has a product designed or manufactured and markets that product under its name or trademark) and Importer (any natural or legal person who places a product by importing it) in the Proposal and it is clearly intended that the Importers are held liable just as the Manufacturers, since they are the ones, who are placing the products to the market.
Although certain main obligations (such as (i) being able to place only those products, which are in conformity with the technical regulations on the market, (ii) marking the product to specify the qualifications, (iii) testing and examining the products by taking samples from them, (iv) recalling or withdrawing products to prevent risks and (v) maintaining of certain documents and records) are already included in the Law, the scope of these obligations are broadened and new and more detailed obligations are intended to be introduced with the Proposal.
Along with the execution authority vested, the President shall determine the principles and procedures that will be applicable to (i) the preparation of the technical regulations and the EU harmonization means, (ii) the assignment of the public authorities that will be conducting the market surveillance, (iii) conformity assessment bodies, (iv) CE mark; and (v) the compatibility audits of the products that are subject to foreign trade.
The Ministry of Trade continues to be in the picture for the rest of the matters and coordination issues, and it is yet to be assigned for being in charge of market surveillance for e-commerce.
The public authorities that will be conducting the market surveillance should continue to be changing depending on the type of the product, as there is no new regime set forth in the Proposal for the determination of such.
Further analysis of the Proposal and the newly introduced provisions therein are provided below under separate sections.
In the Proposal, the manufacturer is defined as any natural or legal person, who manufactures a product or has a product designed or manufactured and markets that product under its name or trademark.
The obligations of the manufacturers are as follows:
From the obligations listed above, placing only the products in conformity with the technical regulation or the general product safety regulations on the market, keeping certain documents, marking the product to include certain related information, testing and examining the products by taking samples from them, recalling and withdrawing products as measures are currently present in the Law. However, while the Law states that the documents shall be kept for a period of time specified by the public authority, the Proposal stipulates that the period shall be the period specified in the technical regulation or in any case be 10 years.
Moreover, although the procedure for testing and examination of the product is included in the Law, it is required if the producer deems necessary. On the other hand, the Proposal states that this obligation arises depending on the possible risks that products present. Thus, more active obligation is imposed on manufacturers.
The authorized representative is defined as any natural or legal person established within Turkey, who has received a written mandate from a manufacturer to act on its behalf in relation to specified tasks with regard to the manufacturer's obligations under this Law or relevant regulations.
Accordingly, the manufacturer may appoint an authorized representative by determining the nature, conditions and limits of the powers and duties transferred in writing and plain language. The authorized representative carries out the tasks given to it by the manufacturer and not restricted by the regulations. However, in any case, the authorized representative has the following obligations:
Importer is defined as any natural or legal person who places a product by importing it. Accordingly, the obligations of the importers are specified as follows:
With respect to the comparison between the Law and the Proposal, please look at the explanations provided under "Obligations of the Manufacturers", as they are the same for the importers.
Distributor is defined as any natural or legal person in the supply chain, other than the manufacturer or the importer, who makes a product available on the market. While the Law specifically states that the distributor is any natural or legal person in the supply chain whose activity does not affect the safety properties of a product, as it is seen, the Proposal does not include the phrase "whose activity does not affect the safety properties of a product". Therefore, it can be concluded that the scope of the distributor is broadened.
Apart from that, the distributor, who fulfilled the obligations specified in the Proposal and delivered the product that has been withdrawn from the market, shall request from the manufacturer or importer to eliminate the problem causing the withdrawal of the product from the market. If possible, the manufacturer or importer shall bring the product to the appropriate state and deliver it to the distributor.
In case the product is required to be made dysfunctional or destroyed, the manufacturer or importer shall make an offer to the distributor for either the payment of sale value of the product, or replacement of the product with another that is equivalent and in conformity with the relevant technical regulations.
Furthermore, even though obligations such as not placing the product on the market in case it is incompatible and informing the relevant parties regarding the measures taken are currently available for distributors, additional obligations are introduced with the Proposal and those include ensuring that the storage and transportation conditions do not violate the technical regulations and cooperating with the relevant economic operator in the activities carried out in order to eliminate the risks presented by the products in the market.
In order to serve the purpose of harmonizing regulation with the developments in e-commerce, the Proposal specifically regulates the obligations for intermediary service providers. Accordingly, the obligation to regularly record the name, commercial title/brand and contact information of the previous and next economic operator in the supply chain, and other information that will facilitate the tracking of the product also applies to (i) the economic operators which place the product or make it available on the market electronically, (ii) intermediary service providers providing an environment for electronic commerce and (iii) media service providers.
Moreover, the relevant public authority is authorized to block access to the content related to the incompatible product by notifying the Information Technologies and Communication Authority in case the content is not removed by the intermediary service provider within twenty-four hours upon the notification of the public authority.
The Proposal anticipates a new liability for the manufacturer and the importer of a product, which is the obligation to compensate in the event that the product causes a damage to a person or a property. If more than one manufacturer or importer is liable for the damage caused by the product, they shall be held jointly responsible. In this regard, the general provisions will be applied in determining the amount of pecuniary and non-pecuniary compensation.
The damage caused by a third person's action or negligence does not affect the amount of the product liability compensation; however, the right of recourse of the manufacturer or importer to the third party is reserved. On the contrary, if the damage is caused by a defect of a person who is under the responsibility of the damaged or the injured, the liability regarding the compensation of manufacturers or importers may be reduced or cancelled. Moreover, the Proposal sets forth that the contracts that either reduce or remove the liability of the manufacturer or the importer arising from the damaging product shall be deemed null and void.
The statute of limitations for the compensation claim is three years from the date on which the damage and the liable person is learned by the sufferer and in any case lapses after ten years from the date on which the damage occurred.
Even though the circumstances where distributors have obligations of the manufacturers is found in the Law, the detailed arrangement has been made in this regard in the Proposal.
The importers and distributors who place the product on the market under their own name/trademark or change the product on the market as its compliance with the technical regulation or general product safety regulations can be affected shall be classified as manufacturers under this Proposal and have the responsibility to fulfill the obligations of the manufacturers stated above.
In cases where the manufacturer, authorized representative or importer of the product cannot be determined, the distributor shall report the contact details of them or the previous economic operator in the supply chain to the public authority within ten business days upon the notification made by the institution. The distributor who does not report such information is also classified as manufacturer and has the responsibility for the product liability compensation under this Proposal.
According to the new liability anticipated in the Proposal, the economic operators shall keep a regular record of the name, commercial title/brand and contact information of the previous and next economic operator in the supply chain, and other information that will facilitate the tracking of the product. Besides, they shall maintain these records for at least ten (10) years from the date they place the product or make it available on the market and present these records to the public authority upon its request.
The obligation also applies to economic operators which place the product or make it available on the market electronically, intermediary service providers providing an environment for electronic commerce and media service providers such as radio and television.
The public authority conducts audits to verify the compliance of the products under its jurisdiction with the technical regulations and general product safety regulations. If the public authority concludes that there is a sufficient justification for the risk of a product, it will conduct a risk assessment. If the public authority detects incompatibility with the regulations while conducting this assessment, regardless of the outcome of the risk assessment, it may ask the economic operator to take necessary measures specified in the Proposal. In the event of a continuation of the incompatibility, the public authority takes all necessary measures such as prohibiting or restricting the placing the product on the market or recalling the product available on the market; or withdrawal of the product from the market. Provided that the product does not present a serious risk, the public authority grants the economic operator a reasonable period of not less than ten working days to defend itself before taking a final decision on the measures.
The economic operator shall take the corrective measures specified in the Proposal in accordance with its obligations in a timely and effective manner. Otherwise, when it deems necessary, the public authority may ask the economic operator to take these measures within a time period it sets.
In case a product that is incompatible with the regulations is sold via internet, the public authority shall send a notification to the intermediary service provider via electronic mail or other communication means. If the content is not removed by the intermediary service provider within twenty-four hours upon the notification, the public authority may conclude a decision to block access to the content related to the product and send a notification to the Information Technologies and Communication Authority for the implementation of this decision. If the website belongs directly to the economic operator, the same procedure is also applied. The decision to block access is concluded with the method of blocking access to the content (URL etc.). This authorization of the public authority is newly regulated by the Proposal.
The Proposal introduces more details regarding the process of the announcement of the measures, which was regulated in the current regulations in simple terms.
The economic operator, who is obliged to take necessary measures as required by this Proposal regarding the product presenting a risk by itself or upon the request of the public authority, shall make an announcement regarding the measures taken and the risks of the product.
The distributors are obliged to convey the information provided by the economic operator regarding the risks and measures related to the product to the next distributor in the supply chain, and put the announcement stated above in places that can be easily seen or reached by its customers.
The process of recalling, which is currently applied, is regulated in detail in the Proposal. Accordingly, in case the precautionary measures that are taken are insufficient to eliminate the risk of the product, the economic operator shall recall the product by oneself or upon the request of the public authority. All costs related to the recalling of the product are undertaken by the economic operator, who recalls the product. The economic operator is under the obligation to provide suitable conditions for the end user to deliver the product easily and on time without incurring an additional cost.
With the Proposal, the administrative fines to be applied in cases of violation of obligations are increased compared to the former regulations on product safety. In the preamble of the Proposal, it is stated that the deterrence is aimed while determining the penalties, and similar regulations regarding the penalties are taken as an example.
While the administrative fines will be increased, the Proposal and its preamble also set assessment criteria when deciding the amounts of administrative fines. Accordingly, the public authority will consider the following while deciding the measure/penalty to be imposed:
While the current regulations allows the economic operators to be held exempt from the liability of administrative fines under two circumstances that are when the product is not placed on the market by the economic operator itself, and in case the production in accordance with the technical regulations or other mandatory rules results in incompatibility of that product, the Proposal brings additional opportunities to economic operators for being held exempt from the liability to pay administrative fine as well as the newly regulated product liability compensation. Accordingly, when the economic operator takes necessary measures by itself and eliminates the incompatibility completely, or when the non-compliance is caused by a distributor or a third party or a user, it may be held exempt from these liabilities.
Footnotes
1 Economic operator is used as a blanket definition in the Proposal (just as in the Law) to cover all the responsible parties determined as the manufacturer, the authorized representative, the importer, the distributor and other natural or legal persons who are responsible for the manufacturing the products, making them available on the market or putting them into service.
2 Regulation (EC) No 765/2008 of the European Parliament and of the Council of 9 July 2008 setting out the requirements for accreditation and market surveillance relating to the marketing of products and repealing Regulation (EEC) No 339/93 and 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
