48 3.1 Comparative comments on product liability in Vietnamese Law and European Union’s Law under the area of tort .... Allocating legal responsibility for defective products and low qua
Overview of Product Liability in Tort
The formation and development of the product liability doctrine
Product liability has become a cornerstone of consumer protection in developed nations, with most countries regulating this area to shield consumers while balancing the interests of manufacturers Historically, the regime has proven its value in safeguarding both sides, and the United States pioneered and expanded product liability law, setting a template that has influenced many jurisdictions worldwide The American approach to protecting consumer interests has left a deep mark on legal systems across the globe, and the European Union, inspired by the U.S model, has developed its own robust product liability framework to effectively defend consumers To truly grasp the theory and practice in products liability law, one must study its history and evolution.
The formation and development of the product liability regime are closely tied to the decline of the privity doctrine Under privity, contracts create no duty to third parties, and only the contracting parties may enforce rights or seek compensation As Professor William Prosser famously described, the history of product liability law is the history of an assault on the citadel of privity, restoring to injured consumers the ability to seek a remedy for injuries caused by defective and unsafe products This perspective often meant that contractual product liability favored manufacturers, with a long-standing general rule that a manufacturer could not be held liable to noncontracting third parties.
This article by M.A Tran Thi Quang Hong and Truong Hong Quang (2010) surveys general issues in the product liability framework and analyzes its role in protecting consumers It offers a concise examination of the institution of product liability, its scope, and the obligations of manufacturers and sellers within the consumer-protection mandate The authors explore how liability regimes deter unsafe products, provide remedies for harmed consumers, and shape the balance between commercial interests and consumer rights Published in the State and Law Review Journal, issue 12/2010, the piece contributes to the legal discourse on strengthening consumer protection through effective product-liability rules.
Under the doctrine of privity, a contract generally confers rights and imposes obligations only on the parties to the agreement, not on any other person In other words, the benefits and duties created by a contract are limited to the contracting parties, with third parties ordinarily unable to enforce or be bound by its terms.
6 M.A Tran Thi Quang Hong, Truong Hong Quang (2010), above n 4
7 Denis W Stearns, (2001), Product liability: A brief history of its early origins, Marler Clark, LLP, p.1 Source: http://www.marlerclark.com/pdfs/intro-product-liability-law.pdf, 06/08/2013 8.30
6 not be sued, even for negligence, if there is no contractual relationship between the manufacturer and the plaintiff
In the nineteenth century, the privity doctrine was used by defendants and judges against plaintiffs seeking damages for injuries caused by defective products In the following decades, the doctrine of privity continued to govern product liability cases.
The seminal case MacPherson v Buick Motor Co of The Court of Appeals of New
York 8 marked the rejection of the privity doctrine in the United States In this case, the plaintiff was injured when a wheel on the car he was driving, and which he bought from a retailer, fell in to pieces, causing the car to crash He brought an action for negligence against the manufacturer The court upheld the plaintiff’s claim and Buick Motor Co had to pay damages to Macpherson This case determined that lack of privity is not a defense if it is foreseeable that the product is likely to cause injury negligently to the consumers
In the United States, the MacPherson decision quickly became the standard in negligence law, signaling a major shift away from the privity requirement By embracing a broader theory of negligence, it rejected the notion that liability could only exist where a contractual relationship existed The court's reasoning was widely accepted and followed by courts in every state, and it helped launch the modern tort of negligence in product liability cases.
With the demise of the privity of contract doctrine, consumers gained two avenues for redress: negligence actions and contract-based claims for breach of warranty However, liability for breach of warranty is limited to cases where the parties are in privity, because warranties were historically viewed as an integral part of the sales contract Express warranties, in particular, are regarded as being made to the buyer.
8 http://www.courts.state.ny.us/reporter/archives/macpherson_buick.htm, 12/07/2013 11.05
Contractual warranties guarantee that goods conform to the contract description, are fit for the intended purpose, and possess merchantable quality If a defective product injures a consumer, the seller can be held liable for breach of warranty under the contract terms Product liability law centers on three key warranties regarding a product’s quality or fitness for use: express warranty, implied warranty of merchantability, and implied warranty of fitness for a particular purpose.
10 http://legal-dictionary.thefreedictionary.com/Breach+of+Warranty 26/05/2013 09.10
During the 1930s, the privity of contract requirement was effectively abandoned In the realm of implied warranties, the exceptions to the privity rule were historically limited to food, drink, and similar products until the New Jersey Supreme Court’s decision in Henningsen v Bloomfield Motors, Inc The case articulated two competing views: liability could extend to any manufacturer who placed a product into the stream of commerce and promoted it, and privity to the original purchaser could be eliminated Nevertheless, Henningsen remained a contract case rooted in the theory of implied warranty.
During this period, courts embraced two core legal theories for product liability—negligence and warranties—that would prove instrumental in later cases Yet their application was limited: negligence claims require showing fault, which constrains consumer-protection relief, while warranty claims are restricted by the privity requirement, limiting lawsuits to those in contractual privity with the seller.
From 1930 to 1960, legal writers and several judges debated the adoption of strict liability in tort for defective products As notions of warranty liability evolved, many American courts began imposing strict liability on manufacturers The best-known exposition of a tort theory of strict liability in product cases came from the California Supreme Court in Escola v Coca-Cola Bottling Co of Fresno In Escola, a waitress was injured at work when a Coca-Cola bottle exploded; although the plaintiff could not prove fault by the bottling company, the court held that the producer and distributor of Coca-Cola bottles bore responsibility for defects in their products.
11 http://law.jrank.org/pages/9466/Product-Liability-Historical-Development.html, 12/07/2013 11.10
12 www.casebriefs.com/blog/law/contracts/contracts-keyed-to-farnsworth/policing-the-bargain/henningsen-v- bloomfield-motors-inc-2, 12/07/2013 11.07
13 The School of Law – Washington University (1974), Strict Product Liability in Tort and the Meaning of
“Unreasonably Dangerous” Defects, Journal of Urban and Contemporary Law, Vol.8, p344-345 See more at: http://digitalcommons.law.wustl.edu/urbanlaw/vol8/iss1/22/, 03/07/2013 09.30
14 http://www.uic.edu/classes/eecs/eecs491el/LectureText/Lect10Text.htm, 04/07/2013 20.30
15 http://law.jrank.org/pages/9466/Product-Liability-Historical-Development.html, 04/07/2013 19.50
16 http://www.casebriefs.com/blog/law/torts/torts-keyed-to-epstein/products-liability/escola-v-coca-cola-bottling-co- of-fresno/, 04/07/2013 20.50
The development of a tort theory of strict liability in product liability cases began in 1963 with the California Supreme Court’s decision in Greenman v Yuba Power Products In this landmark ruling, the Court adopted strict liability in tort as the basis for product liability actions, removing many of the difficulties plaintiffs faced under other theories and establishing a clearer, more assertive framework for recovering for injuries caused by defective products.
With the rapid growth of mass production, maintaining consistent quality is increasingly challenging, leading to more harm to consumers, their property, and third parties due to defective products In developing countries, product liability cases are rising, underscoring the need for clear product liability laws in a globalized market to protect consumers and sustain a fair and efficient market economy.
Definition and nature of product liability in tort
Product liability is the area of law in which manufacturers, distributors, suppliers, retailers, and others who make products available to the public are held responsible for the injuries those products cause 21
Black’s Law Dictionary references product liability as an area of law, which “refers to the legal liability of manufacturers and sellers to compensate buyers, users, and even bystanders for damages or injuries suffered because of defects in goods purchased,” 22 - Product liability in the law of tort include product liability action in negligence and strict product liability in tort
17 Nguyen Thi Tuong Vi (2009), Trach nhiem san pham theo phap luat Cong dong Chau Au va Phap luat Viet Nam
(Product liability in EC’s law and Vietnamese law), Bachelors’ Thesis, HCMC Univerysity of Law, p6
18 See Greenman v Yuba Power Products (1963), http://online.ceb.com/CalCases/C2/59C2d57.htm, 04/07/2013 20.15
19 Nguyen Thi Tuong Vi (2009), above n 16, p6
Ph.D Tang Van Nghia's 2008 study, "Ban ve trach nhiem san pham trong kinh doanh quoc te" (Discussion on Product Liability in Foreign Trade), published in State and Law Review Journal, No 2/2008, pages 41–49, examines the legal framework of product liability within international commerce, highlighting how liability is distributed among manufacturers, sellers, and importers in cross-border transactions and assessing the implications for foreign trade law.
21 http://www.out-law.com/en/topics/commercial/supply-of-goods-and-services/product-liability-under-the- consumer-protection-act/, 05/07/2013 11.25
22 Black's Law Dictionary 5th edition (1979), West Publishing
Product liability protects consumers and is defined in legal frameworks around the world In the United States, the doctrine is set out in Section 402A of the Restatement (Second) of Torts (1965), which holds that a seller of a product in a defective condition that is unreasonably dangerous to the user, consumer, or their property is liable for the physical harm caused to the user, consumer, or their property In the European Union, Council Directive 85/374/EEC of July 25, 1985 harmonizes member-state laws by providing that the producer is liable for damage caused by a defect in their product.
From the definition of product liability, we can draw out the following feature while doing a research about product liability in tort:
Product liability in tort refers to the obligation to compensate for damages caused by a product, even when there is no contract between the parties This form of civil liability places responsibility on the producer to compensate consumers harmed by a defective product In product liability in tort, a contractual relationship between the injured party and the producer is not required to establish liability.
Under product liability, the party responsible for damages is the one involved in the chain that transfers a product from production to the consumer This party can vary by country, depending on national product-liability regulations, and may have a direct or indirect link to consumers Consequently, every product on the market is associated with a responsibility framework ensuring accountability for that product.
- The product is defective and there is a casual link between the and the damage 27
Product liability hinges on the consumer proving three elements: a defect in the product, the damages suffered, and a causal link between the defect and the damage Only by establishing this burden of proof can consumers seek compensation from manufacturers, producers, or wholesalers responsible for the defective product.
23 http://biotech.law.lsu.edu/cases/products/402a-b.htm 05/08/2013 02.30
24 http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uriEX:31985L0374:en:HTML 05/08/2013 02.45
25 M.A Tran Thi Quang Hong, Truong Hong Quang (2010), above n 4
1.2.2 Nature of the product liability in the area of tort
Product liability regulation creates a legal framework that compels manufacturers to produce safe, high-quality products that meet consumer expectations By strengthening accountability and awareness of their responsibilities, this regime improves product safety and protects consumers more effectively in the marketplace.
Product liability can be contractual or tort-based Unlike contractual product liability, tort-based liability arises when a defective product causes damage and there is no direct contractual relationship between consumers and producers, distributors, or importers Under tort law, injured consumers are compensated for harm caused by defective products, regardless of privity of contract Consumers can pursue remedies through negligence or strict product liability against designers, manufacturers, sellers, or others who furnished the product, providing protection to consumers that extends beyond traditional contractual regulation.
Basic content of the product liability under the law of tort
Product liability, whether in general or in tort, concerns defective consumer products Most claims against manufacturers and other parties in the marketing chain for physical harm arise from the inherent dangerousness of the products A product only becomes the subject of product liability when it is defective and damages a consumer, making the defective item the focus of liability in tort.
Object of product liability has the following characteristic: firstly, it is product that is for consumption needs and is statutory regulated and secondly, that product has to be defective
Karl Marx defined a product as the result of the labor process that serves human needs In a market economy, a product is commonly viewed as anything that satisfies market needs and delivers value or benefit Products can be used for consumption, for exchange in markets, or as inputs in further production, tying individual goods to broader economic dynamics of supply and demand.
11 daily needs of human and can also be used for serving the needs of producing and other needs 28
Black’s Law Dictionary defines 'product' as goods that are produced or manufactured by natural means, by hand, or with tools, machinery, or chemicals, and it also covers items created through physical labor or intellectual effort, as well as those produced by natural processes such as generation or growth.
Products can be classified as tangible or intangible Tangible products are physical objects that can be perceived by touch, such as buildings, vehicles, gadgets, or clothing, while intangible products are not physical and are perceived indirectly as services, such as an insurance policy.
- Depend on whether the product is moveable or not, product is classified as real estate or movable property 32
- Depend on the using purpose, product is divided into products for consumption needs and products for production and business needs 33
Under the view of law research about product liability in several countries in the world, product is mentioned as:
- Products in the form of tangible personal property (good or chattel) or intangible (service) 34
- Product for consumption needs (consumer-product)
- Product which is regulated particularly by law
1.3.1.2 Defective product in product liability under the law of tort
In general terms, product liability law requires a product to meet consumers’ ordinary expectations A product which contains an unexpected defect or danger does not
28 Nguyen Thi Tuong Vi (2009), above n 16, p.9
29 Black's Law Dictionary 6th edition (1990), West Publishing
30 Nguyen Thi Tuong Vi (2009), above n 16, p.10
31 http://en.wikipedia.org/wiki/Product_%28business%29 05/07/2013 08.45
32 Nguyen Thi Tuong Vi (2009), above n 16, p.10
34 Mark A Kinzie, Christine F Hart (2001), Product Liability Litigation, West Legal Studies, p.3
12 meet the ordinary expectations of the consumer 35 Victims of injury resulting from the use of unsafe and defective products may be entitled to be compensated in tort
In tortious product liability, the designer, manufacturer, seller, or distributor who furnishes a product may be liable if the product is dangerously defective or unsafe The defect is not only the genesis of a product liability claim but also the central element that governs recovery or defense in the litigation.
Black’s Law Dictionary defines “defective condition” as follows:
A product is defective and unreasonably dangerous when it has a propensity to cause physical harm beyond what the ordinary consumer would anticipate, based on the product’s characteristics and the ordinary knowledge of the foreseeable class of users A product is not defective or unreasonably dangerous merely because injury could occur while using it.
Under product liability law, especially in negligence actions, the manufacturer's conduct determines whether a product is defective In strict liability claims, the defect is established by the product itself through evidence of manufacturing, design, or warning shortcomings Thus, negligence centers on the manufacturer's conduct, while strict liability relies on the product’s condition to prove the existence of a defect.
There are three main types of product defects pertaining to product liability in tort which are manufacturing defects, design defects and marketing defects 39
Manufacturing defect will be determined if a product does not conform to design specifications or performance standards, 40 or it does not follow some material way from
35 http://injury.findlaw.com/product-liability/what-is-product-liability.html, 02/07/2013 23.15
The term "unreasonably dangerous" refers to products that are dangerous beyond what an ordinary consumer would expect to encounter, a standard that is not universally accepted Tort law acknowledges that certain beneficial products, such as prescription drugs and vaccines, cannot be made entirely safe due to inherent hazards These products are not considered defective merely because of their risks; something else must be wrong with them As a result, drug companies are not strictly liable for a properly manufactured product that comes with appropriate directions and warnings In short, design defects are distinct from manufacturing defects.
37 Black's Law Dictionary 5th edition (1979), West Publishing
38 Mark A Kinzie, Christine F Hart (2001), above n 29, p.4
39 http://injury.findlaw.com/product-liability/what-is-product-liability.html, 05/07/2013 19.50
A manufacturing defect occurs when a manufacturer fails to properly assemble a product, adequately test it, or thoroughly check its quality For example, a production-line worker might fail to tighten a bolt sufficiently, or substandard raw materials might be used These defects are typically the easiest to prove in a claim, because the consumer can rely on the manufacturer's own design or marketing standards to demonstrate that the product was defective.
An obvious defect typically leads courts to impose liability in negligence cases, since the defect is readily identifiable and the manufacturer can be held responsible Tort law also applies the doctrine of strict liability to help plaintiffs recover even if they cannot prove the manufacturer was negligent.
Design defects arise when a product is manufactured to specification but contains a flawed design from the pre-production or design stage; in such cases, the defect is inherent in the design rather than in production For example, a chair designed with only three legs may be deemed defectively designed because it tips over easily, and an automobile whose fuel tank is positioned to explode on low-speed impact would be classified as a defective design.
Design defect claims typically require proof of negligence; however, strict liability may apply for an unreasonably dangerous design if the plaintiff proves that a cost-effective alternative design would have prevented the risk of injury.
Marketing defects include labeling of products improperly, insufficient instructions, or the failure to warn consumers of product’s dangers 46 For example, tobacco companies
41 Mark A Kinzie, Christine F Hart (2001), above n 29
42 William M Pride (2013), Marketing 2014, 17th edition, Cengage Learning, p.135
43 http://injury.findlaw.com/product-liability/what-is-product-liability.html, 05/07/2013 20.25
44 See more at: http://www.biicl.org/files/1123_overview_uk.pdf, 06/07/2013 09.50
Design defects can appear in many situations when a product’s design creates dangerous, irrational risks that can harm consumers in everyday use Evaluating the dangers posed by design defects is often complex, requiring systematic hazard analysis, consideration of user interactions, failure modes, and how safeguards may fail Effective assessment combines engineering insight with real-world usage patterns to identify where a product design exposes users to unnecessary risk, and to prioritize corrective actions that improve safety and compliance with safety standards.
45 http://injury.findlaw.com/product-liability/what-is-product-liability.html, 05/07/2013 20.35
Consumers have sued 14, alleging that the company failed to provide adequate warning labels about the health dangers of tobacco, including cancer and other diseases They also allege that a cough syrup label did not warn that taking it with aspirin could cause dangerous drug interactions.
In this type of defect, a negligent regarding a product or action in strict tort liability may also give rise to a marketing defect claim
1.3.2 Parties to a product liability action under the law of tort
1.3.2.1 The people having the right to claim for product liability (Potential claimants)
Consumers who are harmed by defective products may seek compensation through product liability claims, with responsible parties accountable for the damages Product liability claims can be brought by individuals, corporations, or other business entities, and the plaintiff does not need to be the purchaser of the product or be in privity of contract with the defendant.
The meaning of the product liability in tort in the legal system
Product liability in tort is a strong legal tool that protects consumers’ rights and interests when they are harmed by defective products In the typical producer–consumer relationship, consumers are often at a disadvantage in terms of economic power and the ability to bear risk compared with manufacturers and distributors Under the doctrine of product liability in tort, there is no required contractual relationship between the consumer and the manufacturer, producer, or any party in the distribution chain, so this lack of contract makes tort-based liability a crucial legal foundation for consumers to seek redress and defend their rights when defective products cause damage.
Product liability, including liability in tort, places responsibility on manufacturers to compensate consumers for injuries and damages caused by defective products To limit risk and potential costs, manufacturers are driven to invest in better technology and higher product quality, which in turn strengthens brand reputation and consumer trust Strict product liability in tort, which does not require proving the manufacturer's fault, helps filter out unsafe products and protects consumers from dangerous goods These regulations also influence competition, rewarding safer, higher-quality products and pushing manufacturers to improve quality and safety.
Against the backdrop of rapidly developing economies, there is a global push to regulate product liability Most developed countries already have established regimes governing product liability, while developing economies, including Vietnam, are actively building and refining their own frameworks Product liability in tort represents more than a legislative milestone for creating a clear legal corridor that makes manufacturers responsible to consumers; it also serves as an effective tool to safeguard consumer rights and interests Although the regime is relatively young, it began to take shape in the mid-2000s and continues to evolve as markets grow.
72 Punitive Damages under Products Liability, Read more http://www.ea2020.org/punitive-damages-under- products-liability.pdf, 04/08/2013 13h55
73 Nguyen Thi Tuong Vi (2009), above n 16, p.20
20 th century, this product liability institution in tort is developed quickly in order to protect consumers in the most efficient way 74
The European Union’s Law on product Liability and some issues
The European Union’s Law on product Liability under the area of tort
2.1.1 Overview of product liability law in European Union
European Union (EU) is an economic and political union that features a single internal market, a common currency, and a unified legal framework The internal market allows products legally manufactured in one member state to be sold in any other member state without tariffs or duties, boosting cross-border trade This single market has yielded tangible benefits, such as the free movement of goods and stronger commercial activity, although it also faces drawbacks, particularly in the area of consumer rights protection While each member country regulates manufacturers and distributors to safeguard consumers, the absence of fully harmonized rules can create conflicts of law and complicate enforcement of consumer protections across the bloc.
Article 100 of Rome Convention in regard to EU’s foundation, set the enforcement of legal stipulation to regulate efficiently public matters, including protecting consumers 76
The Hague Convention on the Law Applicable to Products Liability, signed in The Hague on 2 October 1973 and entering into force on 1 October 1997, defines the key concepts of product, damage, the damaged party, the person liable for the damage, and the Convention’s scope It establishes that, in most cases, the law of the country where the damaged party resides will apply to claims for product liability damages and sets out rules for choosing the applicable law to resolve conflicts of law efficiently This framework helps harmonize cross-border product liability rules and facilitates smoother adjudication of international cases.
On 27 January 1977, the European Convention on Products Liability in respect of Personal Injury and Death (the Strasbourg Convention 1977) was adopted The convention concentrates on product liability across the product-supply chain for damage to life or health (Article 3) and establishes a strict liability framework for the parties involved in the manufacture, distribution, and sale of products.
75 Read more: http://useconomy.about.com/od/worldeconomy/p/european_union.htm, 04/08/2013 22.05
Under Article 100 of the Treaty of Rome (25 March 1957), any directive whose implementation would necessitate changing national legislation in one or more Member States requires consultation with both the European Parliament and the Economic and Social Committee.
77 Nguyen Thi Tuong Vi (2009), above n 16, p.22-23
Product liability law in the European Community was marked by the Strasbourg 1977 Convention, which established a milestone in its development The Convention’s provisions laid the groundwork for liability rules, and much of that regulatory framework was inherited and further developed by Directive 85/374/EEC.
Before 1985, the product liability laws in tort in different Member States of the European Community were quite dissimilar 79 This disparity could affect competition and create barriers to intra-Community trade by subsidizing producers in some states and penalizing others, as consumers in different European countries were not in the same position, and the producers did not have the same duties towards them 80 To remedy the situation, various proposals for a Directive on Products liability were considered in the seventies and finally led to the adoption by the Community of Directive 85/374/EEC in
1985 81 Directive 85/374/EEC also has discretionary clauses which allow the member countries to enforce more strict regulations in the Directive
2.1.1.2 Legal instruments governing product liability in European Union
EU’s Product liability matter is currently regulated by the following legal documents: 82
- Council Directive of 25 July 1985 on the approximation of the laws, regulations and administrative provisions of the Member States concerning liability for defective products (85/374/EEC)
- Directive 1999/34/EC of the European Parliament and of the Council of 10 May
1999 amending Council Directive 85/374/EEC on the approximation of the laws, regulations and administrative provisions of the Member States concerning liability for defective product
- Directive 98/27/EC of the European Parliament and of the Council of 19 May
1998 on injunctions for the protection of consumers' interests
78 Nguyen Thi Tuong Vi (2009), above n 16, p.23
79 For example, in France, the legal system imposed strict liability, whereas German and Greek law applied fault liability and English law was based on negligence
80 Pearson (1994), Law for European Business Studies, London, p.274
81 Council Directive of 25 July 1985 on the Approximation of the Laws, Regulations and Administrative Provisions of the Member States concerning Liability for Defective Products (85/374/EEC), OJ 1985, No L210/29
82 Nguyen Thi Tuong Vi (2009), above n 16, p.24
- Directive 2001/95/EC of the European Parliament and of the Council of 3 December 2001 on general product safety
- Council Regulation (EC) No 44/2001of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters
- Regulation (EC) No 864/2007 of the European Parliament and of the Council of
11 July 2007 on the law applicable to non-contractual obligations
Therefore, we can see that there are many legal documents of the Europe Community regulating on product liability In the research range of this thesis, the author will only analyse Directive 85/374/EEC and Directive 1999/34/EC in regard of amending some articles in Directive 85/374/EEC, other regulations relating to product liability will not be focused deeply
2.1.2 Basic content of product liability law under the law of tort in European Union
The Directive 85/374/EEC of EU proclaims strict liability as a regime for solving the problem relating to product liability The preface of the Directive starts by saying that
To harmonize the laws of the Member States and prevent distortions in competition and inconsistent consumer protection within the internal market, approximation of national regimes is necessary The existing divergences may distort competition, affect the movement of goods, and yield differing levels of consumer protection It directly concludes that liability without fault (strict liability) on the part of the producer is the sole means of adequately solving the problem posed by our age of increasing technicality and of achieving a fair apportionment of the risks inherent in modern technological production The directive signals strict liability indirectly in Article 4, which says the injured person shall (only) be required to prove the damage, the defect, and the causal relationship between defect and damage, meaning the plaintiff need not prove fault.
The concentration will be focused upon the relevant rules of the law of tort and upon The Directive 85/374/EEC only
2.1.2.1 Principle and purpose of the Directive 85/374/EEC a Principle of the Directive 85/374/EEC
83 Joel González Castillo (2012), “Products liability in Europe and the United States”, Revista Chilena de Derecho, Vol.39 No.2, pp.277–296
Source: http://www.scielo.cl/scielo.php?pid=S0718-34372012000200003&script=sciarttext, 03/08/2013 08.55
The Directive is made up of the following elements:
Strict liability—liability without fault—applies to producers in favor of victims, forming a cornerstone of the EU product liability regime The Directive treats this principle as fundamental, asserting that holding manufacturers strictly liable is the most effective way to resolve product-related harm Because modern technology and production are highly specialized, consumers struggle to assess latent risks embedded in products, making fault-based approaches impractical Therefore, EU tort law on product liability does not require proof of the manufacturer's fault, and lawmakers believe that strict liability best reduces the risks arising from technological progress and industrial modernization.
- It places the burden of proof on the injured party insofar as the damage, the defect, and the causal relationship between the two is concerned;
This provision establishes joint and several liability among all operators in the production chain in favor of the injured party, creating a robust financial guarantee for the compensation of damages By making manufacturers, suppliers, distributors, and other chain participants jointly responsible, the framework ensures the injured party can obtain full restitution even if a single actor cannot fully satisfy a claim, thereby reinforcing accountability and risk management across the production process.
- It provides for exoneration of the producer when the producer proves the existence of certain facts explicitly set out in the Directive;
- It sets liability limitations in terms of time, by virtue of uniform deadlines;
- It sets illegality of clauses limiting or excluding liability towards the injured party;
- It sets a limit for financial liability; and
- It provides for a regular review of its content in the light of the effects on injured parties and producers b Purpose of the Directive 85/374/EEC
The Directive is promulgated to archive two main purposes:
- Ensuring consumer protection against damage caused to health or property by a defective product and protecting manufacturer, creating fairness in the market;
- Reducing the disparities between national laws
84 Helen Delaney and Rene van de Zande (2001), A Guide to the EU Directive Concerning Liability for Defective
Products (Product Liability Directive), p.2 Read more at http://gsi.nist.gov/global/docs/EUGuide_ProductLiability.pdf, 03/08/2013 09.15
2.1.2.2 Subject that take legal responsibility
Article 1 of the Directive says that the producer shall be liable for damage caused by a defect in his product This means liability, or the responsibility to pay for damages, is placed on the producer Article 3 defines the producer not only as the manufacturer of a finished product, but also as:
- The maker of any raw material or the manufacturer of a component part;
- Any person who, by putting his/her name, trademark or other distinguishing feature on the product, presents himself/herself as the producer( known as own-brander);
Product liability rule: when the producer cannot be identified, every supplier of the product is treated as the producer, and the same rule applies to imported goods—if the product does not indicate the importer’s identity, even if the producer’s name appears The directive also states that suppliers and importers who inform the injured person of the producer’s identity or of the person who supplied them with the product are no longer liable.
Any person who imports into the Community a product for sale, hire, leasing, or any form of distribution in the course of their business, whether acting as an independent distributor or as a branch of a foreign manufacturer, is an importer for the purposes of this article (Section 87).
Article 3 of Directive 85/374/EEC allows the damage party to take legal proceedings against anyone involved in the product distribution chain in order to get compensation for damage
When two or more persons are liable for the same damage, they are jointly and severally liable This arrangement lets the injured party decide whom to sue, using criteria like ease of service, who has the deepest pockets, or who carries the best insurance coverage After a judgment is obtained against one defendant, that party may then seek contribution or recourse from the other liable parties.
86 The reason for this being to prevent the consumer from the inconvenience of attempting to pursue a claim against a foreign producer
Importer liability does not cancel out the foreign manufacturer's liability The foreign manufacturer remains jointly and severally liable toward the victim under the product liability laws of the member states.
88 http://legal-dictionary.thefreedictionary.com/Jointly+and+severally+liable 04/08/2013 17.55
Some issues on product liability in tort in Vietnamese law
2.2.1 Overview of product liability in tort in Vietnamese Law
Product liability is a relatively new concept in Vietnam The Vietnamese legal system does not have a single, dedicated product liability statute; instead, the liability framework is spread across several laws Currently, there are no standalone regulations that specifically govern product liability Instead, applicable provisions come from the Law on Protection of Consumers’ Rights, which underpins consumer protection and provides remedies for defective products within the broader framework of consumer law.
Vietnam's product liability framework, anchored in the Civil Code of 2010 and the 2005 laws on product quality, regulates producer liability for the products they place on the market This indicates that a formal product liability regime exists in Vietnam and is continually being improved to fulfill its purpose of protecting consumers, by holding manufacturers accountable for product safety, quality, and compliance across the product lifecycle.
Legal instruments governing issues relevant to product liability in Vietnam under the area of tort:
Vietnam’s Civil Code 2005 sets out the tort provisions from Articles 604 to 630, together with their guiding regulations, forming the core framework for civil liability in Vietnam As the primary legal instrument, the Civil Code governs the most common tort issues, detailing the elements of liability, fault, damages, and available defenses, and it serves as the authoritative source for resolving disputes involving harm to persons or property.
Vietnam's Law on Products and Goods Quality 2007, together with its guiding regulations, stands as the first law specifically regulating the liability of individuals and business organizations operating within Vietnam's territory Although the Law on Products and Goods Quality outlines the framework for ensuring product quality and accountability, it is continually supported by guiding regulations to adapt to changing market needs.
2007 doesn’t present directly the definition of “product liability”, provisions of producer’s liability had already shown the basic factors of product liability
- The Law on Protection of Consumers’ Rights 2010 and its guiding regulations 126 This Law on Protection of Consumers’ Rights is a great achievement in developing and
This institution governs the legal framework for damages, including grounds for liability for damage (Art 604) and the principles of damage compensation (Art 605) It defines the capacity of individuals to compensate for damage (Art 606) and establishes limits on when lawsuits can be filed to claim damages (Art 607) It sets out damages arising from infringements on property (Art 608), health (Art 609), life (Art 610), and on honor, dignity or prestige (Art 611) It also specifies the duration of the right to receive compensation for damages affecting life or health (Art 612) and provides for compensation in a number of specific cases (from Art.).
125 Resolution No 03/2006/NQ-HĐTP of the Supreme Court’s Committee of Judges on 08 July 2006 guiding on the application of some regulations of the Civil Code 2005 on Tort
126 Decree 99/2011/ND-CP Detailing and Guiding a number of articles of the Law on Protection of Consumer Rights
37 amending Vietnamese legal system in general and laws on protecting consumers in particular
Related statutes, including Commercial Law 2005, Competition Law 2005, the Law on Standards and Technical Regulations 2006, and the Laws on Sanction of Administrative Violations, establish the liability framework for producers and traders to ensure product safety for consumers When a violation occurs, the responsible parties are required to compensate damages and may be subject to administrative penalties or criminal sanctions under these laws.
Product liability is a relatively new issue in Vietnam, with limited or unclear provisions within the Vietnamese legal system Violations of consumers’ rights by product providers are fairly common, yet Vietnam still lacks comprehensive product liability laws, creating a fragmented legal basis to address producers’ misconduct Studying Vietnamese legal provisions related to product liability can help develop clearer, more effective laws on product liability and strengthen consumer protection in Vietnam.
2.2.2 Product liability in the recent regulations of law
Vietnam's Law on Protection of Consumers’ Rights 2010 marks a turning point in the ongoing legislative effort to strengthen consumer protection in the country A key feature of the 2010 law is the advancement of product liability provisions, including the introduction of strict liability, which expands accountability for manufacturers and sellers Although there is still no explicit definition of product liability within the law, it lays the groundwork for clearer standards, enforcement mechanisms, and enhanced remedies for consumers under Vietnam's consumer protection framework.
In 2010, Vietnam’s product liability framework introduced fundamental provisions that overcome the limitations of earlier legal documents The most notable change was the removal of the fault requirement, so liability for defective products under Vietnam’s tort law no longer depends on proving fault by the producer This concept of strict liability—liability without fault—is now applied in most countries worldwide, and as Vietnam integrates into the global economy and opens its market, adopting this common standard for product defects is a reasonable move The reform strengthens consumer protection by reducing the burden of proof for injured consumers and simultaneously pressures producers to ensure safer products, safeguarding the legitimate interests of all consumers in a competitive market.
2.2.2.1 Principle and purpose of product liability provisions a The principle of product liability under the law of tort in Vietnam
The principle may be presented through the following provisions:
Article 630 of the VCC 2005 states that any individual, legal entity, or other subject who manufactures or distributes goods without ensuring adequate quality standards shall be liable for damages caused to any consumer This liability reinforces consumer protection by holding producers and distributors accountable for harm resulting from defective or substandard products and underscores the responsibility to meet quality controls in the supply chain.
Chapter V, Part 2 of the LPGQ defines in detail the compensation principles governing product and goods quality, including the rules for paying damages and the types of damages arising from defective quality It sets out the compensatory liability of manufacturers, importers, and sellers, clarifying who bears responsibility for losses caused by poor product quality It also outlines the defenses available to liable parties, ensuring a balanced framework for resolving quality-related compensation claims.
Vietnam’s Law on Protection of Consumers’ Rights 2010 defines the rights and duties of consumers, establishes the liability of organizations, goods and service providers, and trading individuals toward consumers, and assigns social organizations a role in protecting consumer rights It also sets out dispute resolution mechanisms between consumers and organizations, and between consumers and goods and service trading individuals, with the State bearing responsibility for overseeing consumer protection In addition, the article explains the purpose of product liability under Vietnam’s law of tort, outlining how defective products trigger accountability and remedies for consumers.
Code provisions and United Nations guidance aim to protect consumers from unfair practices in dealings with large, information-rich corporations By promoting transparency, fairness, and accountability, these standards seek to level the playing field, reduce information asymmetry, and help consumers make informed choices.
Beside, provisions of product liability also protect fair competition on the market, which help improve the business operating of the corporations 127
2.2.2.2 Subject that take legal responsibility
Under Clause 2, Article 23 of the Laws on Protection of Consumers’ Rights, the compensating organization means any organization or individual engaged in trading goods, including: a) organizations or individuals producing the product; b) organizations or individuals importing the product; and c) organizations or individuals who affix the commercial name to their products or use labels or instructions that help identify the responsible parties.
127 http://www.luatviet.org/Home/phap-luat-va-cuoc-song/2010/9126/Can-quy-dinh-mot-cach-toan-dien-ve-che- dinh-trach-nhiem.aspx, 03/08/2013 15.25
39 producing, importing products; d) Organization, individual providing defective products directly to consumer in case it is impossible to determine the right organization, individual to compensate for damage
Under the LPGQ, the liability for damages is imposed on producers, importers, sellers when they do not ensure the quality of their products, causing damage to buyers or consumers 128
Under Article 61 of the LPGQ, with the exception of Article 62, producers and importers are liable for damages when their fault results in a failure to ensure product quality, causing damage to buyers or consumers; likewise, sellers are liable for damages when their fault results in a failure to ensure product quality, causing damage to buyers or consumers.
Compensation shall be paid according to agreements between involved parties or court decisions or arbitral awards 131