CHINA Law and Practice Contributed by: Yue Dai, Zhenghao Li and Xiaokun Yuan, King & Wood
Safety Obligations , the Criminal Law also sets out criminal penalties in cases where the product quality issue has resulted in severe and far-ranging conse - quences. 2.2 Standing to Bring Product Liability Claims In China’s legal system, consumers and other infringed individuals or entities have standing to bring claims for product liability if their rights or interests are impaired. Specifically, an individual or entity can file a lawsuit against the manufacturer or seller in court based on a contractual relationship or an act of infringement. Multiple injured individuals involved in a product liabil - ity case may have standing to bring representative liti - gation. If the number of injured individuals is unspeci - fied, the court could publish an announcement to notify potential plaintiffs to register as plaintiffs. The registered plaintiffs can nominate co-plaintiffs to be their representatives and participate in the litigation on their behalf. The judgment issued in these cases will bind all registered plaintiffs. If unregistered parties file additional claims, the original judgment will apply and bind the unregistered parties in those claims as well. Lastly, public interest institutions, organisations or the state procuratorate may file public interest litigation when the legitimate rights or interests of multiple con - sumers have been harmed. For example, the China Consumers Association and consumer associations at the provincial level are eligible to initiate a public interest litigation in consumer disputes. An amend - ment to the Civil Procedure Law in 2017 introduced the new mechanism of public interest prosecution, allowing the procuratorate to prosecute a case relat - ing to food and drug safety if there is no relevant institution or organisation with the power to file public interest claims, or the relevant institution or organisa - tion does not file a claim. 2.3 Time Limits for Product Liability Claims According to the Civil Code, the statute of limitation for product liability claims – either contractual or tort – is three years. The limitation period is calculated from the day when the plaintiff (eg, the consumer or other infringed individuals) knew or should have known the identity of the respondent and that their right had been infringed. In any event, the court will not offer protec -
national or industry standards on personal or prop - erty safety; and • in the absence of applicable statutory standards, an “unreasonable danger” standard, which con - siders a product to be defective if it unreasonably endangers the life or property of the consumer. In practice, even if a product meets the relevant national or industry standard, the court will still pro - ceed to examine whether it meets a reasonable per - son’s expectations regarding product safety. There - fore, compliance with the statutory standard alone does not necessarily guarantee that the product is defect-free. Sources of Law In the context of civil disputes, the following key legal instruments governing product liability allow the victim to raise contractual or tort claims against the product seller and/or manufacturer:
• the Civil Code; • the PCRI; and • the Product Quality Law.
Over the years, the Supreme People’s Court of China (SPC) has also issued a series of judicial interpreta - tions in relation to specific issues arising in product liability cases. These judicial instruments guide courts in their interpretation of key statutory definitions and concepts. Since China is a civil law country, the principle of stare decisis does not apply in product liability litiga - tion. However, judges may still be guided by prec - edents, particularly if found in judgments of the SPC or other superior courts addressing similar facts or legal issues, or if the area of law is unsettled. Among these judgments, “Guiding Cases”, as designated by the SPC or the Supreme People’s Procuratorate, are of precedential value and should be referenced and followed by courts when adjudicating similar cases. Apart from civil liability, product quality disputes may also give rise to administrative liabilities, as provided under the Product Quality Law, the PCRI and other laws and regulations for specific products. Separately, as discussed in 1.5 Penalties for Breach of Product
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