CHINA Law and Practice Contributed by: Yue Dai, Zhenghao Li and Xiaokun Yuan, King & Wood
3.2 Future Policy in Product Liability and Product Safety The general tendency in product liability, as outlined in 3.1 Trends in Product Liability and Product Safety Policy , is to extend the level of protection to consum - ers while maintaining a more balanced approach in protecting the legitimate interests of business opera - tors. Based on the latest legislative and judicial prac - tice discussed in the previous sections, future policy directions in product liability and product safety are expected to focus on the following aspects: • exploring the applicability of product liability rules in disputes concerning emerging technologies, such as artificial intelligence and automated driv - ing; • clarifying the standards for determining product defects; • increasing the use and function of punitive dam - ages in product liability cases while ensuring that bad-faith consumers do not profit from punitive damages claims; • enhancing collaboration between procuratorates and consumer associations in public interest litiga - tion, and exploring approaches for effectively using public interest compensation in such cases; and • strengthening the oversight of high-risk product categories, including food, drugs and infant prod - ucts.
gifts or samples. Moreover, business operators shall notify consumers if such free products or services have flaws that do not contravene mandatory rules or
affect their normal performance. Calculation of warranty period
Under the new rules, the warranty period for return, replacement and repair as agreed between the busi - ness operator and the consumer shall not be shorter than any statutory rules. In general, the warranty period shall start from the date when the product is delivered to the consumer or the service is completed. Where the business operator has performed its replacement duty, the warranty period shall be reset, starting from the date of the completion of the replacement. Expansion of the mandate of consumer associations In addition to responsibilities set out in the PCRI, the new rules grant an additional mandate to consumer associations. Consumer associations may hold talks with the business operators or industrial organisations on consumer protection issues. They are also man - dated to carry out investigations on infringement of consumer rights and require the business operators to submit statements and evidentiary materials. Determination of consumer fraud While the new rules reiterate the compensation for consumer fraud, it is also clarified that such fraud does not cover the circumstance in which the flaws in markings or labels, manuals or promotional materials will not impact the quality of products or services, nor mislead consumers. Further, the new rules stipulate that punitive damages for fraud do not apply to those intending to obtain compensation through fraudu - lent acts. In this respect, administrative and criminal penalties (if any) shall be imposed on such bad-faith entities.
90 CHAMBERS.COM
Powered by FlippingBook