By: Li Yongmei King & Wood’s Domestic Litigation & Arbitration Practice

Recent issues regarding Chinese products have focused on the gaps remaining in the law.  However, the gaps are quickly closing.  Product safety has become a top priority for China. Chinese authorities have streamlined the legislative process for product recalls at all levels…

As the main supervising department for product quality, the General Administration of Quality Supervision, Inspection and Quarantine has promulgated several regulations on defective product recalls. These regulations include the “Regulation for Defective Automobile Product Recalls” (which came into force on Oct 1, 2004), the “Regulation for Child Toy Recalls” (which was promulgated on Aug, 2007), and a 3C certification for toys (that came into force in September of 2007). These new regulations aim to eliminate incidents like “Benz smash” and the “Mattel recall” etc. The “Regulation for Medicine Recall”, implemented in December of 2007, symbolized the law’s guarantee of public medicine safety. The “Law for Food security in The People’s Republic of China (draft)” and the “Regulations for the Supervision and Administration of Medical Devices” (draft amendment) are all now in the process of soliciting public opinion. These regulations represent a comprehensive system for recalling food and medical devices produced and sold in China. These new rules will also offer a further level of legal protection to consumers in terms of physical health and safety.

Furthermore, the procedure for dealing with defective product recalls has also been streamlined. According to the legislative affairs office of the General Administration of Quality Supervision, Inspection and Quarantine, the “Regulation for the Recall and Administration of Defective Products (draft)” has been submitted to the Legislative Affairs Office of the State Council, and is planned to be implemented next year. According to this regulation, the scope of defective product recalls extend to all products that pose a serious risk to health and safety except food, medicine, and medical devices. The implementation of this regulation will fill the shortage of rules for product recalls in China, and bring China in line with international standards. It will also avoid an unfair and discriminatory result for Chinese consumers whereby Chinese companies face unlimited liability abroad while defective foreign products only face very limited levels of liability in China.

The establishment of recall rules indicates that China has built a recall system that meets international standards. However, for protecting consumers, the regulation itself is not enough, implementation is more important. Compared to mature legal systems for product recalls in western countries, there is still a long way to go.