10 Sept 2018
Significance of a No-deal Brexit on Rules Governing Product Safety; UK Publishes Product Standards Strategy
Under WTO-only rules, Hong Kong companies with their business hubs in the UK that wish to circulate their goods elsewhere in Europe would have to prove they meet all of the EU’s product standards and regulations. This will be costly for, and cumbersome on, traders. Goods such as medicines, medical devices, electronics and foodstuffs – even certain types of clothing or footwear – that are subject to EU rules will have to meet a variety of product or food safety standards. Currently, the UK standards are generally recognised in the EU, and vice-versa. However, when the UK leaves, the aforementioned goods, and several others, may need conformity assessments from an EU recognised body, which is a legal responsibility for an EU importer. This could mean that UK exports would take longer to reach EU markets, and make UK products more expensive in the EU, possibly resulting in end-users finding cheaper alternatives.
There would obviously have to be product compliance for imports entering the UK as well. In January 2018, the UK Government set up the Office for Product Safety and Standards to prepare the country’s exit from the EU. This body’s function and reach will become even more significant to traders in the event of a no-deal Brexit.
Last month, the Office published a strategy setting out its goals and priorities together with a delivery plan detailing how these goals should be achieved and what the agency’s next steps will be. The new agency will provide centralised support to existing agencies, and focus on ensuring that businesses comply with applicable product standards and other issues such as product recalls.
The Office for Product Safety and Standards was set up as part of the Department for Business, Energy and Industrial Strategy on 21 January 2018. The Office covers general, non-food consumer product safety, but will not cover vehicles, workplace equipment, construction products, or medicines and medical devices. These areas are already covered by other agencies. The aim is to provide centralised and specialised support to existing market surveillance authorities (MSAs) around the country.
The strategy identifies four core pillars around which the Office will structure its work. The Office will analyse, inform, enforce and build.
In terms of analysis, the Office will seek to make use of the latest sources of data, scientific advice, behavioural economics theory and intelligence-gathering tools to map the needs of consumers, manufacturers and innovators.
In March 2018, the Office released a Code of Practice for product recalls. The Code contains details on how businesses can monitor product safety and plan for a recall, and how MSAs can assist them in doing so. The Code also contains information on how companies can monitor and review their corrective actions programmes to make sure that product safety responsibilities continue to be up-to-date. The Code was created together with leading retailers and industry groups such as Tesco’s, Samsung Electronics, the British Retail Consortium, the Royal Society for the Prevention of Accidents and the Association of Chief Trading Standards Officers.
Furthermore, it will be of interest to Hong Kong traders to know that the Office will seek to better inform both consumers and businesses about applicable standards. In particular, it will review the information available on the website GOV.UK so it is easily accessible and comprehensible.
Regarding enforcement, the Office will help strengthen goods controls at the borders and support the so called “Primary Authority partnerships” whereby companies can seek authoritative advice from MSAs on product safety issues and approvals. The Office will be able to offer more targeted and specialised expertise when dealing with large multinational firms and manufacturers active in several markets.
The Office is also offering to help companies improve their compliance procedures by assessing their management systems, conformity assessment processes and Technical Files, and will assist businesses in ensuring that the recall Code is properly implemented and operationalised.
To deal with large scale product safety incidents, the new agency has also drawn up a product incident management plan and established a national incident management team.
In addition, the Office will work with MSAs and local authorities to carry out direct enforcement activities. This will include a review of both product compliance and recall systems currently in place for white goods manufactures supplying the UK market. These activities will be undertaken after March 2019, i.e. after (a no-deal) Brexit, and Hong Kong businesses that could be affected by either review would be advised to examine and assess their legal compliance systems and recall processes before then.
Lastly, the agency will focus on increasing cooperation and collaboration to build a stronger British compliance infrastructure. It will cooperate with local authorities to launch a market surveillance testing programme, work with established testing houses and also invest in new testing expertise and equipment of its own. It will also be responsible for ensuring that the nearly 50 existing EU Directives addressing product safety and standards are properly implemented in the UK after Brexit.