Executive Briefings

Product Might Be Defective? You Better Report It.

The Consumer Product Safety Act requires importers to report information that reasonably supports a conclusion that the product: 1) fails to comply with a regulatory or voluntary consumer product safety standard; 2) contains a defect which could create a substantial product hazard; or 3) creates an unreasonable risk of serious injury or death. In certain circumstances, the act may also require a company to report if a product is the subject of a civil lawsuit.
The Consumer Product Safety Commission has recognized the need to balance the free flow of goods between countries with the responsibility importers have to protect American consumers from unreasonably hazardous products made abroad. However, it encourages companies to file reports when in doubt. To encourage reporting, the CPSC regulations do not require an importer to admit that the product constitutes a substantial product hazard. By reporting a potential hazard, however, an importer may avoid future penalties and other negative consequences that may flow from a failure to report.
When an importer fails to report, it is subject to civil penalties at a minimum of $5000 for each offense and a maximum of $1.25 million--an amount that may substantially increase in the future.
Source: Industry Week, http://industryweek.com

The Consumer Product Safety Act requires importers to report information that reasonably supports a conclusion that the product: 1) fails to comply with a regulatory or voluntary consumer product safety standard; 2) contains a defect which could create a substantial product hazard; or 3) creates an unreasonable risk of serious injury or death. In certain circumstances, the act may also require a company to report if a product is the subject of a civil lawsuit.
The Consumer Product Safety Commission has recognized the need to balance the free flow of goods between countries with the responsibility importers have to protect American consumers from unreasonably hazardous products made abroad. However, it encourages companies to file reports when in doubt. To encourage reporting, the CPSC regulations do not require an importer to admit that the product constitutes a substantial product hazard. By reporting a potential hazard, however, an importer may avoid future penalties and other negative consequences that may flow from a failure to report.
When an importer fails to report, it is subject to civil penalties at a minimum of $5000 for each offense and a maximum of $1.25 million--an amount that may substantially increase in the future.
Source: Industry Week, http://industryweek.com