Product Compliance

Product compliance is an umbrella term for various regulations that are crucial for everyone in the online sales business. We’ve summarized relevant rules, further information and explained selected certificates that are most important for Amazon sellers.

What is product compliance?

In both parts of the word “product conformity” or “product compliance”, you can find its meaning: It’s about the single product and the regulations or laws to which you need to adhere (conformity/compliance) when manufacturing or selling it.

These rules can be national or for example EU-wide required by law, or depend on the sales platform like those for sustainable products.

Is product compliance relevant for me?

The EU laws for example always exactly define the responsible person or part responsible for product conformity. In most cases, this is the manufacturer.

SPACEGOATS extra tipManufacturer, initial distributor and substitution for manufacturer (“Herstellerfiktion”):

Especially in the world of ecommerce, the initial distributor is what you have to look out for: Did anyone else previously sell this product in this country or am I the first one to for example import this article from China to Germany? In the latter case, you as the seller still have to take care of compliance regulations. Since the initial distributor takes the manufacturer’s place, the seller substitutes for the manufacturer. (This is called “Herstellerfiktion” in German in the EU law.)

For example, if you buy electric drills from Bosch in order to resell them, Bosch is generally responsible for all certifications. As the seller, you are still obligated to double-check this in the respective register. If you, however, then decide to sell these drills in Spain or Italy, you might be the initial distributor in these countries and therefore responsible to register the tools there – otherwise you could end up in the worst case scenario of getting into trouble for fencing due to unregistered goods.

Selected certificates

REACH

REACH (Regulation concerning the Registration, Evaluation, Authorisation and Restriction of Chemicals) is the EU act for chemicals. This regulation takes care of everything surrounding chemical laws in Europe, for example limitations of substances such as lead or cadmium.

The so-called POP (Persistent Organic Pollutants), long-lasting harmful substances, are also regulated by this law.

At the latest when it comes to substances that are harmful for health and body, you hold a great level of responsibility to offer your customers a good product. The devil’s often in the details: There might for example be only a tiny foam material part in a pressure washer that’s infested with polycyclical aromatic hydrocarbons (PAH) if you don’t examine the supplier beforehand. Other well-known problems involve the discourse on glyphosate.

For electric appliances, there is another special label controlling the maximum limit of materials that are harmful to health and body, the RoHS regulation (Restriction of Hazardous Substances).

CE

The CE marking is probably one of the best-known European certifications.

However, it is important not to mix it up with the China export label which looks dangerously similar.

When it comes to who’s responsible, the same rule applies as before: The manufacturer has to take care of the certification, for sellers, it’s sufficient to get a confirmation or checkup. Nonetheless, if you are the first one to export into Europe from elsewhere, you are in charge of all EU conformity declarations and certifications. In very rare cases, a Chinese manufacturer did for example already take care of everything – this should then definitely be checked very carefully, though.

How do I check for certificates and registered products?

Most certifications can be reviewed in a transparent, public register in the respective country. In Germany, for electric appliances, you can for example search the data base of the ear (“Stiftung ear”) for manufacturers or brands and then see if the respective fees have been paid that are for example necessary in order to one day dispose of the product in a recycling depot.

At the European commission Trade Helpdesk for the EU you can receive an initial overview of the certifications you need for a certain product – with one click.

Registering products can be super easy, for example with the Central Agency Packaging Register (ZSVR), you can do this online within a few minutes.

SPACEGOATS extra tip: This is by the way the only law in this area worldwide that no contractor can do for you. As a manufacturer or seller, you always have to do this registration yourself.

On the other hand, there are registrations in some countries that are a lot more complex. On top of that, every European country decides for themselves, what you need to register and what you don’t.

This also applies to the category into which your product falls. An electric appliance might not be liable in Germany but elsewhere – and vice versa. TVs for example are an electric appliance in most countries and are also pretty recognizable as such. This is different for other articles: Shoes that light up or a Santa hat with blinking lights for example still count as electric appliances in Germany. In France, however, they remain simple articles of clothing. France has a separate law for textiles and textile disposal, though. Another example: So-called passive electric appliances like cables or power outlets have been liable for registration in Austria since 2018, Germany only followed later due to political pressure.

In general, communication with suppliers couldn’t be more important. As a seller, you should always talk to the manufacturer and clarify for each particular product, which certifications already exist and which ones still need to be requested, which norms and rules apply and what the basis for assessment is.

If a manufacturer, for example in China, sends you a certificate, you should always have that verified by a service provider. Possible options for this are for example the German Association for Technical Inspection (TÜV) or Intertek.

SPACEGOATS extra tip: It is possible to exclude particular products or countries from your export plan, for example when it comes to electric appliances. That means the appliances won’t be send to any EU country where you haven’t paid the necessary disposal fees.

Product compliance and Amazon

The most product conformity risks and violations happen on Amazon. The platform wants to take action against this with a market surveillance order beginning in 2020/21. Up until now, Amazon has not really been a market player but merely a platform for other players. That’s why Amazon never really held any responsibility – but they still alway put customer protection and product conformity first. Every seller that can’t present any number or some sort of certification gets blocked as soon as Amazon finds out. In the future, certificates and verifications are supposed to be proactively requested by Amazon, for example the ZSVR number, the registration with the Federal Environment Agency, the WEEE (Directive on Waste Electrical and Electronic Equipment) and so on.

Consequences of violations & how to proceed in case of competitors’ violations

What happens if you don’t adhere to the regulations or can’t produce a certificate?

Violations of product compliance entail consequences in several legal areas.

According to environmental law, for example, the respective federal environment agency is in charge. Certifications like the WEEE are being monitored by customs but depending on the country, not all products or appliances need to be registered.

If a seller doesn’t adhere to product compliance, they create a disadvantage for every competing seller. Competitors can assert these claims in court: On the one hand, you can file for an injunction suit meaning the seller who violated product compliance regulations is not allowed to continue selling the product. On the other hand, you can sue them for compensation, even with retroactive effect from the beginning of sales.

Finally, contract law is also in effect here – the private law aspect. The seller is liable to every single customer to provide goods free from material defects and defects of title. In case of a violation, every single customer can sue the seller because of these defects, for amendment, decrease in value – or cancel the purchase.

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