Safety reporting changes considered – July 3, 2006

swadminJuly 3, 2006

The Consumer Product Safety Commission is proposing rule changes that would allow manufacturers, distributors and retailers to consider more factors in deciding whether to report safety problems associated with products.
The proposal, published May 26 in the Federal Register, would change the agency’s so-called interpretive rule adopted in 1978, which gives companies guidance on how to comply with the law’s requirement to report potentially unsafe products.
The proposal’s three main revisions would:

Add four items to the list of factors companies can consider in assessing whether a risk fits the definition of a potential hazard, triggering the reporting requirements. They are the obviousness of such risk, the adequacy of warnings and instructions to mitigate such risk, the role of the consumer misuse of the product, and the ability of such misuse to be foreseen.

Direct companies to consider the number of products still in use, recognizing that “the risk of injury from a product may decline over time as the number of products being used by consumers decreases.”

Advise companies to factor in whether an affected product, despite reported problems, complies with safety standards, either those voluntarily adopted by the industry or imposed by the government.
The CPSC says the revisions are designed to provide “further guidance, clarity and transparency” on the reporting obligations under the Consumer Product Safety Act and are “not intended to reduce the volume of reporting.”
Nevertheless, CPSC Commissioner Thomas Moore is a critic of the proposal. Moore issued a statement on the agency’s Web site calling the proposed revisions an apparent response to industry “overtures.” He said the changes could create a “safe harbor” for companies to avoid penalties for failing to report unsafe products under the federal Consumer Product Safety Act
“For products that have the potential to kill or cause serious injury, there can never be so few left on the market that we would not require a recall,” he wrote.
Companies that fail to report can face civil penalties. In fiscal 2005, six companies paid $8.8 million in penalties for failing to report in a timely manner dangerous or defective products.
The public had until June 26 to comment on the proposal. psb

swadminJuly 3, 2006