Consumers may lose more than they gain from new liability rules

The ECR Group has rejected the revision of the product liability rules.

The text, voted on today by the internal market and legal affairs committees, aims to extend the EU’s product liability framework to new types of goods in the digital and circular economy, such as software. Since, according to the Commission, the existing directive is generally effective and relevant instrument, only well-justified reforms should be introduced, which is not the case, according to Jurzyca MEP. The impact assessment does not clearly explain the scale of the problem and it does not present an analysis of the overall net impact of the proposed solution. Industry would have to spend more on insurance and lawyers, and member states would likely face more court cases. New rules on the burden of proof and introduced unclear definitions would hinder legal certainty in the market.

“What is the added value for the consumer? Frankly, we don’t know. The Commission has not assessed the net impact on consumer welfare. On the one hand, the Union wants to further improve consumer protection and rights. But on the other hand, the costs and consequences of these changes should also be taken into account, and that is what is missing here,” said Jurzyca.

“At the moment it seems that economic growth in Europe is slowing down. I think one possible reason for this could be that we are introducing new rules and regulations without performing any sound economic analyses,” he added.

The ECR’s shadow rapporteur in the Legal Affairs Committee, Kosma Złotowski MEP, agreed: “Europe should be a beacon of new regulation, instead we have a Tower of Babel. The law could lead to disproportionate costs, for example for software developers, with possible increases in insurance costs of up to 25 per cent. We risk discouraging digital start-ups and scale-ups, which are already leaving our region because of the regulatory burden.”

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