Report from the Commission to the Council, the European Parliament and the European Economic and Social Committee - Third Report on the application of Council Directive on the approximation of laws, regulations and administrative provisions of the Member States concerning liability for defective products (85/374/EEC of 25 July 1985, amended by Directive 1999/34/EC of the European Parliament and of the Council of 10 May 1999)
Date: 2006-09-14
Institutions: European Commission
Subjects: application of EU law, approximation of laws, consumer protection, defective product, product safety, report

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 14.9.2006 
COM(2006) 496 final 

REPORT FROM THE COMMISSION TO THE COUNCIL, THE EUROPEAN 
PARLIAMENT AND THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE 

Third report on the application of Council Directive on the approximation of laws, 
regulations and administrative provisions of the Member States concerning liability for 
defective products (85/374/EEC of 25 July 1985, amended by Directive 1999/34/EC of 
the European Parliament and of the Council of 10 May 1999)  

EN 

   EN 

 
 
 
  
REPORT FROM THE COMMISSION TO THE COUNCIL, THE EUROPEAN 
PARLIAMENT AND THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE 

Third report on the application of Council Directive on the approximation of laws, 
regulations and administrative provisions of the Member States concerning liability for 
defective products (85/374/EEC of 25 July 1985, amended by Directive 1999/34/EC of 
the European Parliament and of the Council of 10 May 1999)  
(Text with EEA relevance) 

EN 

2 

   EN 

 
TABLE OF CONTENTS 

1. 

2. 

3. 

3.1. 

3.2. 

3.3. 

3.4. 

INTRODUCTION........................................................................................................ 4 

BACKGROUND.......................................................................................................... 4 

APPLICATION OF DIRECTIVE 85/374/EEC during 2001 – 2006 .......................... 5 

Council Resolution of 19 December 2002 on the amendment of liability for defective 
products ........................................................................................................................ 5 

The Lovells Report (published in 2003) ...................................................................... 6 

The Fondazione Rosselli Report (published in 2004).................................................. 6 

Conclusions of the meetings held with the working groups (2003/2004) and 
conclusions extracted from the questionnaire prepared by the European Commission 
(2005/2006) .................................................................................................................. 7 

3.5. 

Judgments of the Court of Justice ................................................................................ 8 

4. 

5. 

FURTHER WORK ...................................................................................................... 8 

CONCLUSIONS........................................................................................................ 11 

EN 

3 

   EN 

 
1. 

INTRODUCTION 

In  accordance  with  Article  21  of  Directive  85/3741  (‘the  Directive’),  the  Commission  must 
review  the  efficiency  of  the  product  liability  legal  framework  on  a  regular  basis.  The  first 
report COM(1995) 617 was presented in 1995. The second review exercise was launched with 
a Green Paper on Product Liability adopted in July 1999, COM(1999) 396 final, leading to the 
second report published on 31 January 2001, COM(2000) 893 final.  

This third report has taken due account of the results of the last two studies carried out for the 
European Commission2, the outcome of meetings with interested parties and their responses 
to a questionnaire sent at the end of 2005. 

As  it  was  requested  by  Council  Resolution  of  19  December  2002  on  amendment  of  the 
liability for defective products Directive (2003/C 26/02), this report also considers the issue of 
suppliers’ liability. 

As an overall conclusion, the report will demonstrate that the Directive works by and large in 
a  satisfactory  way  and  that  there  is  no  need  for  amendments  at  present.  Also,  that  there  are 
some  circumstances  where  the  application  of  the  national  laws  leads  to  different  outcomes, 
but  without  affecting  the  functioning  of  the  Internal  Market.  Those  circumstances  will 
continue to be closely monitored by the European Commission. 

2. 

BACKGROUND 

Since  1985,  the  Directive  85/374/EEC  on  liability  for  defective  products  introduced  in  the 
Community  the  principle  of  liability  without  fault.  According  to  it,  any  producer  of  a 
defective  movable  must  compensate  any  damage  caused  to  the  physical  well-being  or 
property  of  individuals,  independently  of  whether  there  is  negligence  on  the  part  of  the 
producer  or  not.  Directive  99/34/EC  extended  the  scope  of  this  kind  of  product  liability  to 
unprocessed primary agricultural products. 

This  legislation  applies  to  any  product  marketed  in  the  European  Economic  area  and  is  of 
direct  concern  to  consumers  and  producers  alike.  By  striking  a  fair  balance  of  risk  among 
these  two  groups,  this  legislation  aims  to  unite  consumers’  interests  with  Single  Market 
policies (namely free exchange of goods and elimination of competition distortions). 

The Directive on product liability contains the following main elements: 

– 

liability without fault of the producer; 

1 

2 

Council  Directive  85/374/EEC  of  25  July  1985  on  the  approximation  of  the  laws,  regulations  and 
administrative  provisions  of  the  Member  States  concerning  liability  for  defective  products  (OJ  L  21, 
07.08.1985  p.  29  –  33)  as  amended  by  Directive  1999/34/EC  of  the  European  Parliament  and  of  the 
Council of 10 May 1999 (OJ L 141, 4.6.1999, p. 20 – 21) and corrected by Corrigendum (OJ L 283, 
6.11.1999, p. 20). The date for implementation of the Directive was 25 July 1988. 
LOVELLS, Product liability in the European Union; 2003; and FONDAZIONE ROSSELLI, Analysis of the 
Economic Impact of the Development Risk Clause as provided by Directive 85/374/EEC on Liability for 
Defective Products; 2004. 

EN 

4 

   EN 

 
                                                 
– 

– 

– 

– 

– 

– 

burden  of  proof  on  the  victim  as  regards  the  damage,  the  defect  and  the  causal 
relationship between the two; 

joint and several liability of all the operators in the production chain, so as to provide 
a financial guarantee for compensation of the damage; 

a  500  €  threshold  regarding  damages  suffered  in  order  to  avoid  litigation  in  an 
excessive number of cases; 

exoneration of the producer when he proves the existence of certain facts explicitly 
set out in the Directive; 

liability limited in time, by virtue of uniform deadlines; 

illegality of clauses limiting or excluding liability towards the victim. 

In  view  of  the  different  legal  traditions,  the  Directive  accepts  that  Member  States  derogate 
from the common rules (“options”) with regard to some points by: 

– 

– 

not  exonerating  the  producer  even  if  he  proves  that  the  state  of  scientific  and 
technical  knowledge  at  the  time  when  he  put  the  product  into  circulation  was  not 
such as to enable the existence of a defect to be discovered; 

by  fixing  a  financial  ceiling  of  not  less  than  70  million  EUR  for  damage  resulting 
from death or personal injury and caused by identical items with the same defect. 

3. 

APPLICATION OF DIRECTIVE 85/374/EEC DURING 2001 – 2006 

The Council and the Commission, as well as the informal working groups organized by the 
latter  institution  have  taken  a  number  of  actions  during  this  period.  The  Council  adopted  a 
Resolution and the Commission called for two studies to evaluate several aspects of the day-
to-day implementation of the Directive. Moreover, two different working groups were set up 
in  2003  to  bring  together  the  opinions  of  professional  and  academic  experts  of  recognized 
standing.  

Last but no least, it has to be underlined that the European Commission continues to closely 
monitor the process of implementation and application of the Directive in the EU. Directive 
85/374/EEC has been transposed and is being put into application in the twenty five Member 
States. 

3.1. 

Council  Resolution  of  19  December  2002  on  the  amendment  of  liability  for 
defective products3 

In  this  Resolution,  the  Council  considered  that  there  was  a  need  to  assess  whether  the 
Directive  should  be  modified  in  such  a  way  as  to  allow  for  national  rules  on  liability  of 
suppliers to be based on the same grounds as the liability system in the Directive concerning 
liability of producers. 

3 

Council  Resolution  of  19  December  2002  on  amendment  of  the  liability  for  defective  products 
Directive (OJ C 26, 4.4.2003, p. 2 - 3). 

EN 

5 

   EN 

 
                                                 
3.2. 

The Lovells Report (published in 2003) 

This  study  was  carried  out  on  behalf  of  the  European  Commission  in  order  to  analyse  and 
compare  the  practical  effects  of  the  different  systems  applicable  in  Member  States  of  the 
European Union regarding procedural aspects of claims for defective products. 

The report showed that for the first time there was some collective experience of the Directive 
being  used  in  almost  all  Member  States.  The  overall  conclusion  of  the  report  was  that  the 
Directive  can  be  seen  to  offer,  at  least  to  the  extent  that  it  was  uniformly  implemented  and 
interpreted, a common level of protection for consumers and a common basis for liability of 
producers.  The  research  also  showed  that  the  predominant  (although  not  universal)  view  is 
that the Directive, and the product liability system to which it belongs, strike an appropriate 
balance  on  the  whole  between  producers/suppliers  interests  and  those  of  consumers. 
Moreover,  it  demonstrated  that  there  was  no  uniform  call  for  major  reform  of  the  Directive 
from any particular category of persons affected by its terms. Indeed, it was developments in 
more general areas, such as access to justice, procedural reforms and perceived changes in the 
"claims  culture"  that  were  seen  by  many  (and  in  particular  producers  and  insurers)  as 
presenting a risk of upsetting the prevailing balance. 

It  is  worth  noting  that  whilst  most  consumer  representatives  and  a  minority  of  other 
participants  suggested  that  the  Directive  did  not  strike  an  appropriate  balance,  no  single 
deficiency was cited. This does not, of course, discount the validity of the views expressed, 
but  it  does  make  it  difficult  to  conclude  that  the  Directive  is  fundamentally  flawed  in  any 
significant respect. 

The  broad  acceptance  of  the  main  provisions  of  the  Directive  is  a  remarkable  achievement 
given the nature of the reforms introduced by it and the controversy that has surrounded the 
history  of  its  adoption  and  implementation.  Furthermore,  the  research  undertaken  in  the 
course of this report revealed no clear and consistent call from within the EU for significant 
reform of the Directive. Indeed, many participants have urged that there be no reform at all. In 
particular,  a  number  of  them  suggested  that  it  would  be  better  to  await  the  outcome  of 
developments  in  other  areas,  which  might  have  an  impact  on  the  practical  operation  of 
product liability systems and may affect the Directive. These include developments at an EU 
level in areas such as product safety regulation, access to justice and consumer protection in 
general. 

3.3. 

The Fondazione Rosselli Report (published in 2004) 

This  study  was  carried  out  on  behalf  of  the  European  Commission  in  order  to  analyse  the 
economic impact of the Development Risk Clause (DRC) as provided by Art 7(e) of Directive 
85/374/EEC  on  Liability  for  Defective  Products.  This  clause  excludes  liability  for  damage 
caused  by  a  defect  that  could  not  be  foreseen  given  the  technical  and  scientific  knowledge 
available at the time the product was developed.  

The interpretation of Art 7(e) has created difficulties and given rise to different interpretations 
between  various  courts:  see  for  example  cases  on  infected  blood:  A  v  National  Blood 
Authority  (1999)  English  High  Court  re  blood  infected  with  Hepatitis  C,  and  Hartman  v 
Stichting Sanquin Bloedvoorziening (1999) Amsterdam District Court re HIV, which reached 
seemingly opposing conclusions.  

EN 

6 

   EN 

 
The  DRC  was  defined  in  order  to  establish  a  satisfactory  compromise  between  the  need  to 
stimulate  innovation  on  the  one  hand  and  consumers’  legitimate  expectations  for  safer 
products on the other. The crucial argument of the current debate on the DRC is that removing 
this clause would stifle innovation. 

The  findings  presented  in  this  report  seem  to  indicate  that  the  often-used  argument  of  the 
Development  Risk  Clause  being  a  significant  factor  in  achieving  the  Directive’s  balance 
between  the  need  to  preserve  incentives  to  innovation  and  consumers’  interests  is  well-
founded and is based on the following: 

– 

– 

– 

the DRC protects incentives to innovate in reducing the innovation-related risks, by 
not diverting resources from R&D to insurance policies and by pushing firms to align 
to state of the art knowledge; 

the  DRC  is  probably  one  key  factor  in  determining  the  relative  stability  of  product 
liability insurance costs in European industry and keeping litigation at a reasonable 
level; 

in  a  strict  liability  regime,  companies  in  high-tech  /  high  risk  sectors  would  find  it 
very  difficult  to  obtain  a  reasonable  insurance  policy  which  covers  their 
developmental risks. 

The combination of these factors lead Fondazione Rosselli to conclude that the costs of letting 
the  producers  innovate  within  a  strict  liability  environment  would  be  extremely  high,  and 
would  affect  consumers  in  the  long  term.  In  effect,  both  the  Lovells  and  Rosselli  studies 
conclude that such a defence should be maintained. 

3.4. 

Conclusions  of  the  meetings  held  with  the  working  groups  (2003/2004)  and 
conclusions  extracted  from  the  questionnaire  prepared  by  the  European 
Commission (2005/2006) 

The  Economic  and  Social  Committee  in  its  opinion  on  the  1999  Green  Paper  advanced  the 
idea of an observatory to monitor the functioning of the Directive. Two working groups have 
been  created:  one  of  experts  designated  by  national  authorities  and  another  of  stakeholders. 
They assist the Commission in its task of keeping existing legislation in the product liability 
field under constant review. The focus of the first meetings was primarily on the results of the 
two studies carried out on behalf of the Commission (the  “Lovells  study” and the “Rosselli 
study”). 

Stakeholders  and  experts  are  generally  in  favour  of  maintaining  the  balance  struck  by  the 
Directive  between  competing  interests.  No  demand  for  major  reforms  has  been  advanced. 
Nevertheless,  a  few  members  have  voiced  their  concern  regarding  differing  interpretations 
given  to  certain  provisions  of  the  Directive  by  national  courts  which  might  be,  in  their 
opinion, capable of creating distortion of competition across Member States. All participants 
agreed that decisive help to eliminate these inconsistencies might come from the case law of 
the European Court of Justice, which is more and more frequently called on to adjudicate on 
references for preliminary rulings coming from national courts.  

On the other hand, by means of a questionnaire, the European Commission asked at the end of 
2005,  whether  the  members  of  the  aforementioned working groups  believed that there were 
any significant changes of circumstances since the 2001 report was published. 

EN 

7 

   EN 

 
Among  the  stakeholders  and  national  experts,  the  Directive  is  largely  perceived  as  positive 
and  beneficial  to  consumers.  The  broad  majority  of  the  responses  received,  indicate  the 
absence  of  any  significant  change  in  EU  law  since  2001.  Most  of  the  participants  can  be 
labelled as “generally satisfied with the current situation” and many of them do not see any 
reason at all for amending the Directive4. The only point of concern has been the 500 EUR 
threshold,  where  some  ask  for  clarifications;  while  others  for  its  abolition.  This  might  be  a 
topic on which future discussion and monitoring could be based. 

3.5. 

Judgments of the Court of Justice 

Since  2001  and  to  the  drafting  this  report,  the  Court  of  Justice  has  ruled  on  nine  different 
occasions relative to Directive 85/374/EEC.  

The Court of Justice offered some guidance on the concept of ‘damage’ in the case Veedfald 
(C-203/99);  referred  to  some  issues  on  the  national  measures  of  transposition  in  the  cases 
against  France  (C-52/00),  Greece  (C-154/00)  and  Spain  (C-183/00);  idem  in  the  case  Skov 
Æg (C-402/03) and gave a definition of the concept ‘put into circulation’ in the case Declan 
O’Byrne (C-127/04). 

Finally,  in  one  of  its  most  important  judgements5  on  this  subject  the  Court  of  Justice 
underlined  the  fact  that  “…the  limits  set  by  the  Community  legislature  to  the  scope  of  the 
Directive are the result of a complex balancing of different interests. As is apparent from the 
first  and ninth recitals in the preamble  to  the Directive, those interests include guaranteeing 
that competition will not be distorted, facilitating trade within the common market, consumer 
protection  and  ensuring  the  sound  administration  of  justice.”  In  line  with  this  ruling,  the 
European Commission recalls that the founding principles of Directive 85/374/EEC achieve a 
delicate balance between the interests of claimants, manufacturers and their insurers. Shifting 
or  removing  these  founding  principles  such  as  causation  –  article  4,  prescription  periods  – 
articles  10  &  17,  the  development  risk  exemption  –  article  7,  would  mean  that  the 
interrelationships between these parties would upset this balance leading to adverse economic 
effects and diminishing the level of consumer protection. 

Therefore,  one  of  the  foremost  priorities  for  the  European  Commission  is  to  continue  to 
closely  follow  developments  in  case  law  and  in  the  practical  operation  of  product  liability 
systems. 

4. 

FURTHER WORK 

Certain aspects of the Directive concerning the protection of consumers and the functioning of 
the  Internal  Market  require  continued  monitoring  and  could  even  be  subject  to  further 
clarification.  Differences  on  the  interpretation  of  these  concepts  by  national  courts  can 
sometimes  lead  to  disparities  in  the  judicial  application  of  certain  aspects  of  this  Directive 

4 

5 

For  instance,  only  three  stakeholders  oppose  to  the  actual  formulation  of  Art.  7(e)  (development  risk 
clause);  only  five  stakeholders  and  just  one  Member  State  have  requested  the  creation  of  a  EU-wide 
compensation fund. 
Judgment of the CJ in case C-154/00 (Commission of the European Communities v Hellenic Republic) 
of 25/04/2002, paragraph 29. 

EN 

8 

   EN 

 
                                                 
from  one  Member  State  to  another,  but  there  is  little  evidence  that  those  disparities  create 
significant barriers to trade or distortions to competition in the EU6. 

At  this  stage  it  should  be  noted  that  the  Lovells  report  had  already  underlined  that  the 
Directive does not fully harmonise product liability laws throughout the EU such that, in any 
Member State, consumers and producers/suppliers could expect the same outcomes in similar 
circumstances. Indeed, at the time the Directive was adopted, it was intended to provide for 
limited  harmonisation  only,  whilst  at  the  same  time  "[opening]  the  way  towards  greater 
harmonisation".  Nevertheless,  taking  into  account  the  conclusions  of  the  report,  total 
harmonisation in the broadest sense is not only unrealistic, but also not necessary in view of 
the limited impact (if any) that its absence would have on the Internal Market. 

In  the  light  of  the  above,  the  following  legal  concepts  constitute  areas  where  the  European 
Commission proposes that close and regular monitoring takes place: 

– 

the burden of proof (Art. 4); 

Questions  relating  to  the  burden  of  proof  continue  to  be  controversial,  and  of  real  practical 
significance.  There  remains  a  perception  on  the  part  of  some  consumer  representatives  that 
consumers  are  unfairly  disadvantaged  by  the  burden  of  having  to  prove  defect  and/or 
causation in product liability claims. The concern mainly arises from perceived difficulties in 
proving claims due to a lack of legal or other resources needed to investigate them properly, 
or  to  an  inability  to  gain  access  to  essential  information.  Such  problems  are  seen  to  be 
particularly acute in relation to highly technical products, or where the alleged injuries are of 
a complicated nature. 

Producers  and  insurers,  on  the  other  hand,  are  concerned  that  any  relaxation  of  the  rules 
relating  to  the  burden  of  proof  might  have  the  effect  of  encouraging  "spurious  claims". 
Indeed,  some  producers  suggested  that  there  should  be  a  greater  obligation  on  claimants  to 
substantiate claims in the early stages of proceedings. 

The  difficulties  which  claimants  may  have  in  proving  fault  have  been  redressed  to  varying 
degrees  in  several  Member  States.  In  Portugal  and  Austria,  for  example,  there  is  a 
presumption of fault in the event of non-fulfilment of a contractual obligation, in which case 
the burden of proof shifts to the defendant to prove the absence of fault. 

In a number of Member States, national courts have been prepared to infer the existence of 
fault from the fact that the product is defective. Examples of this practice have been reported 
in  cases  in  the  Netherlands  and  Ireland.  In  such  cases,  there  is  effectively  a  reversal  of  the 
burden  of  proof,  with  a  requirement  for  the  defendant  to  present  evidence  to  convince  the 
court that he was not at fault, notwithstanding the defective condition of the product. This is 
also  seen  in  Denmark.  Similarly,  the  Supreme  Court  in  Spain  has  established  in  many 
judgments  that  the  claimant  has  only  to  prove  the  damage  and  the  causal  link  between  the 
defendant's activity and the damage; fault is presumed unless the defendant can prove a high 
level of due diligence. In many cases the defendant will only be exonerated if he can prove 
the intervention of a fortuitous event or force majeure, or the exclusive fault of the claimant or 
a third party. In Italy, in the case of injury caused by "hazardous" products, the burden rests 

6 

As conclusion #4 in the Lovells Report literally states. 

EN 

9 

   EN 

 
                                                 
on the defendant to prove that all suitable measures had been taken to prevent the damage if 
the defendant wishes to avoid liability. 

– 

the concept of defect (Art. 6); 

The  Directive  prescribes  an  "expectations"  test  for  defect  -  that  is,  a  product  is  said  to  be 
defective  if  it  does  not  provide  the  safety  that  a  person  is  entitled  to  expect.  The  subjective 
nature  of  the  "expectations"  test  means  that  this  principle  is  incapable  of  precise  definition. 
This leads to some very practical questions about matters such as whether it is appropriate for 
a court to undertake a risk/benefit analysis when assessing what a person is entitled to expect, 
and the extent to which the actual conduct of a producer (such as the degree of care taken, or 
not taken) is ever relevant in this context. These questions have arisen in reported cases but 
have  yet  to  be  finally  resolved  by  the  courts  in  any  Member  State.  For  example,  in  the 
aforementioned case A and Others v National Blood Authority, the English High Court said 
that  the  conduct  of  the  defendant  is  not  a  factor  to  be  taken  into  account  when  considering 
whether a product is defective. However, in the subsequent case of Sam Bogle and others v 
McDonald's  Restaurants  Ltd,  the  English  High  Court  cited,  as  a  relevant  consideration,  the 
steps  taken  by  McDonalds  to  train  its  staff  in  relation  to  the  safe  service  of  hot  drinks  to 
customers. 

Uncertainty also surrounds the question of what is required to prove "defect". In some cases, 
courts seem to have decided that it is sufficient that the claimant merely prove that the product 
failed  and  that  such  failure  resulted  in  injury.  In  a  case  decided  by  the  Tribunal  de  grande 
instance  of  Aix  en  Provence  in  France,  the  claimant  was  injured  when  a  glass  window  in  a 
fireplace exploded in circumstances where the precise cause was unknown. The Tribunal said 
that the intervention of the product at the time of the harm was sufficient and that the claimant 
did not have to prove the precise cause of the accident to prove that the product was defective. 

In  a  similar  case  in  Belgium  involving  an  exploding  soft  drink  bottle  the  claimant  was  not 
required, under the Directive, to prove “the exact nature of the defect, in particular as regards 
all its technical aspects”. 

This is in contrast to the approach of the courts of the United Kingdom in Richardson v LRC 
Products  Ltd  (which  involved  a  condom  that  broke  during  use)  and  Foster  v  Biosil  (which 
involved  a  silicone  breast  implant  that  ruptured  in  situ).  In  both  of  these  cases,  the  product 
failed, but the cause of the failure was unknown. Unlike the decisions in France and Belgium, 
the United Kingdom court in each case decided that, under the Directive, the claimant bore 
the  onus  of  proving  the  nature  of  the  alleged  defect,  and  not  merely  that  the  product  had 
failed. As the claimants were not able to prove what had caused the failure, the claims were 
unsuccessful. 

– 

the development risks defence (Art. 7(e)); 

Member  States,  by  Article  15(1)(b),  have  had  the  option  to  exclude  the  defence  in  their 
implementing legislation, but only Finland and Luxembourg have chosen to do so. Although 
the Court of Justice has provided some explanation of the scope of the defence7, its precise 

7 

Judgment of the Court (Fifth Chamber) of 29 May 1997. Commission of the European Communities v 
United Kingdom of Great Britain and Northern Ireland. Case C-300/95. European Court reports 1997 
Page I-0264. 

EN 

10 

   EN 

 
                                                 
scope  remains  uncertain  Indeed,  there  appears  to  have  been  only  one  reported  example  of 
where  the  defence  has  been  used  successfully,  namely  the  Sanquin  Foundation  case  in  the 
Netherlands. In this case, suppliers of blood contaminated with HIV were able to rely on the 
defence in circumstances where there was not a reliable screening test available to them at the 
time of supply. It is interesting to note, however, that a court of the United Kingdom decided 
in a subsequent case that the defence was not available in similar circumstances.  

– 

the minimum threshold (Art. 9); 

This provision is subject to different interpretations in the Member States. In most Member 
States, including Austria, Denmark, Finland, Germany, and Italy, the threshold is treated as a 
“deductible”,  in  that  the  amount  of  damages  awarded  to  a  successful  claimant  (for  property 
damage)  is  reduced  by  the  specified  amount.  In  some  other  Member  States,  such  as  the 
Netherlands  and  the  United  Kingdom,  the  threshold  is  treated  as  a  minimum  amount,  such 
that, provided the claim exceeds that minimum, the full amount of damages is recoverable. In 
Spain,  the  amount  is  expressed  in  the  implementing  legislation  to  be  a  deductible  but  in 
practice  the  courts  treat  it  as  a  threshold,  such  that  the  amount  has  never  actually  been 
deducted from any award. 

The lower threshold is clearly an issue in Finland in particular, where a number of participants 
suggested that it should be abolished.  

– 

the defence of regulatory compliance;  

Some  stakeholders,  and  in  particular  representatives  of  the  pharmaceutical  industry,  have 
argued  strongly  for  the  introduction  of  a  defence  of  regulatory  compliance,  which  would 
apply  to  a  product  whose  safety  was  closely  regulated,  provided  that  the  product  complied 
fully with the applicable regulations.  

– 

novel products, design defects and failure to warn. 

Some  stakeholders,  mainly  in  the  producers  category,  suggested  that  the  "strict  liability" 
standard  under  the  Directive  was  inappropriate  for  dealing  with  liability  arising  through 
design defects or injuries attributed to "informational defects" such as a failure to warn. 

5. 

CONCLUSIONS 

After  having  taken  into  account  the  information  obtained  regarding  the  application  of  the 
Directive, the Commission does not consider it necessary, at this stage, to submit any proposal 
for its amendment. More specifically regarding the Council Resolution of 19 December 2002 
on  the  amendment  of  the  liability  for  defective  products  Directive,  the  opinion  of  the 
European Commission is that if the Resolution were given effect, this would mark a departure 
from the objective of harmonisation of product liability laws under the Directive. 

Nevertheless, it should not be underestimated that further harmonisation can also be achieved 
by accomplishing the highest possible common grounds of interpretation of the legal concepts 
of the Directive. This can be achieved using: 

– 

The case law of the Court of Justice of the European Communities. 

EN 

11 

   EN 

 
– 

– 

The  power  of  control  of  the  European  Commission  (examination  of  national 
transposing  measures,  possibility  of  starting  infringement  procedures  for  incorrect 
application). 

Continuous analysis within the working groups. 

In this sense, the Commission proposes the continuation during 2007 of the examination and 
discussion within the working groups, referred inter alia to the concepts mentioned in point 4 
above  (“Further  work”)  with  the  objective  of  analyzing  the  existing  Community  legal 
framework  with  regard  to  liability  for  defective  products.  As  experience  in  the  use  of  the 
Directive  grows,  discrepancies  existing  in  the  operation  of  the  Directive  between  Member 
States  may  assume  greater  practical  significance,  in  which  case  some  intervention  by  the 
Commission may be warranted.  

The  Commission,  in  accordance  with  Article  21  of  the  Directive,  must  present  periodic 
reports  to  the  Council  and  the  Parliament.  It  will,  therefore,  continue  to  monitor  the 
implementation  and  the  effects  of  the  Directive  and  evaluate  any  eventual  need  for  future 
amendments in its next report on the application of Directive 85/374/EEC. 

EN 

12 

   EN