By Rod Freeman and Anthea Davies, Hogan Lovells

The product safety landscape globally is constantly evolving as a result of regulatory developments, changes in enforcement practices, new technologies, and increasing consumer awareness. In recent times, we have seen the global regulatory landscape undergo significant change, not least in the area of product safety recalls. These changes are giving rise to new risks and challenges for product manufacturers, especially for international brand names with a significant reputational stake in global markets.

Historically, for companies conducting product recalls involving products sold worldwide, compliance with the requirements in the US was the primary concern from a regulatory perspective. Those days are now long-gone, with the regulatory requirements in other parts of the world increasingly presenting varied and, sometimes, unpredictable, challenges, and as approaches to enforcement continue to evolve around the world. Accordingly, the same product issue will give rise to different obligations in different countries, in terms of reporting procedures, the extent of the corrective action required and the expected notification measures to consumers.

The challenges presented by adhering to constantly changing regulatory obligations, across a multitude of jurisdictions, while maintaining a clear and consistent message to consumers on a global basis means that it is far from straightforward for global companies to successfully

conduct an international recall when the need arises. Success in executing a global recall will be reliant on proper co-ordination, central global management and engaging people with the right experience on a global basis.

While responsible companies take every precaution to prevent unsafe products entering the market, on the rare occasions when such products enter the market, it is important to present a well-managed coordinated public image, to maintain consumer confidence and reassure authorities that the issue is well taken care of. 

It is clear that the current state of affairs concerning product recalls on a global basis is complex, and is changing rapidly. While the ideal scenario would be for a company to take a consistent approach across all jurisdictions, it is simply not possible in the current regulatory environment. Although national authorities may require different corrective measures and information, with proper care and coordination to address local regulatory issues in a manner consistent with the global action, the action as a whole can be handled to minimise inconsistencies, while simultaneously reassuring the market and authorities that the issue is being resolved in a responsible, efficient and well-managed fashion, thereby protecting the good reputation of the company throughout the recall process.

Note: This is an extract from Australian Product Liability Reporter, May 2015, Volume 26 No 4