Beginning on January 1, 2020, businesses from outside the EU will now need to appoint a legal representative that will be held liabile in the event that their product do not adhere to the bloc’s legal norms and regulations.
The new Compliance and Enforcement regulation aims at limiting the sale of dangerous products but could create an effective non-tariff barrier for small companies from China to the UK. The details for rach legally responsible person will have to be printed on the label of every product.
The proposal will cover goods that meet EU standards and bear the CE certification mark, that is, 80% of goods, ranging from light bulbs and tools to board games. The new regulation will not affect companies that already have EU subsidiaries or agents.
According to the European Commission, there are too many unsafe products in circulation, including 32% of toys, 47% of construction products, and 58% of electronics. The dangers are more pronounced in the era of online shopping, which flood the market with substandard products that are hard to physically monitor.
The UK, Luxembourg, and Slovakia have raised objections to the new regulation but were ultimately outvoted. Officials from the European Parliament, the European Commission, and the European Council met on December 18 to finalise the regulation.
The UK’s Federation of Small Businesses estimated a cost of just under €1,700 per product category, to hire an EU-based law firm for legal representation. The Canadian Chamber of Commerce wrote a letter addressing non-EU Ambassadors in November, raising the concern that small businesses would no longer be able to export to the European Union.