April 7, 2006
Consumer Product Safety Commission Product Safety Reporting Awareness
In an article in In-House Counsel, Ken Ross highlights the actions of the compliance staff of the Consumer Product Safety Commission (CPSC) in seeking significant civil penalties against companies for failure to report or late reporting. The reporting requirements of the Consumer Product Safety Act obligate manufacturers, importers, distributors, and retailers to immediately notify the Commission upon obtaining information reasonably supporting the conclusion that a product distributed in commerce presents certain specified dangers or hazards or fails to comply with certain CPSA standards. The most significant basis for reporting is section 15(b)(2) of the Act, which requires requires reporting of a defect that could create a substantial product hazard. Mr. Ross reviewed all the penalty matters for the past five years and found several common threads in the cases. The manufacturer may have made a design change because of a safety issue without reporting it to the Commission or notifying prior users of the change; the manufcturer may have issued a dealer alert without reporting it to the Commission or alerting its customers; the manufacturer failed to supply complete information to the Commission when investigating a safety issue; or the Commission had to request information from the manufacturer. The author concludes that in light of the fact that some 40% of reports do not result in action by the Commission, manufacturers and others in the chain of distribution should err on the side of early reporting and avoid the potential for a late-reporting fine.
April 7, 2006 | Permalink
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