Research Report
Ⅰ. Background and Purposes
□ Taiwan and Singapore are two of Korea’s main trade partners which possess high consumer consciousness and have adopted and legislated product liability system.
□ While the main items which Korea exports to Taiwan and Singapore consist of electronics, processed food, and cosmetics in which product defect is unavoidable, studies on these two countries’ product liabilities laws are as progressed as needed.
□ This research aims to study the structures and contents of the product liability laws of Taiwan and Singapore in order to provide information to businesses that are expanding to these two countries and to the Korean government, and to contribute to the collection and distribution of Asian legal information carried out by the Legal Collaboration Team of Korea Legislation Research Institute and the Asia Legal Information Network.
Ⅱ. Main Contents
□ Taiwan’s product liability law is based on the Consumer Protection Law, and the tort and contract laws provided on the Civil Code.
○ Consumer Protection Law provides that business operatorswho are engaged in the business of designing, producing, manufacturing, importing or distributing goods, or providing services bear product liability for goods, including movables and immovables, and services.
○ Consumer Protection Law protects consumer and 3rd parties against goods and services that fail to meet and comply with the contemporary technical and professional standards of the reasonably expected safety prior to the sold goods launched into the market, or at the time of rendering services or does not have a warning and the methods for emergency handling of such danger labeled at a conspicuous location where goods or services may endanger the lives, bodies, health or properties of consumers.
○ Consumer Protection Law applies strict liability, and the consumer bears the burden of proving the defect, injury, and the causal link between the two.
○ On the other hand, tort law provides that the manufacturer bears product liability for defects that arise while a merchandise is produced, manufactured, processed, or designed. The plaintiff (consumer) bears the burden of proving the defect (prima facie evidence), an injury caused during a reasonable use or consumption of the merchandise, and the causal link between the two. The defendant (manufacturer) may prove that he met his duty of care.
○ When product liability is based on warranty, the purchaser must prove the existence of sales contract, sale and delivery of the product, and the defect which substantially reduces the product’s value; the manufacturer may defend himself with the purchaser’s knowledge of defect, lack of examination at the time of purchase, or lack of notice from the purchaser to the manufacturer upon discovery of defect after the examination of the product.
○ When product liability is based on contractual duty, the purchaser must prove the contractual relationship between the purchaser and the seller, incomplete performance by the debtor(seller), injury to the purchaser’s body or property, and the causal link between the incomplete performance and the injury.
○ The Consumer Protection Committee under the Executive Yuan is in charge of enforcing and supervising product liability system. While authorized non-governmental consumer groups may bring a class action on behalf of consumers, Taiwan’s Consumer Protection Law encourages mediation for resolution of consumer disputes.
□ InSingapore, product liability arises from breach of contractual duty, including breach of warranty and unfair contract, and from tort.
○ Product liability based on contractual duty is provided in the Sale of Goods Act (SOGA) and the Consumer Protection (Fair Trading) Act (CPFTA).
○ SOGA provides remedies for the buyer who is in a contractual relationship with a seller who fails to supply goods of satisfactory quality under a contract of sale. The buyer must prove the contractual relationship with the seller and the seller’s breach of contract; however, the seller may elect defence that the unsatisfactory quality of goods was specifically drawn to the buyer’s attention before the contract was made or that the buyer examined the goods before the contract was made, which such examination should have revealed.
○ CPFTA provides basis for product liability for breach of contractual duty when the supplier who is in a contractual relationship with the consumer made an unfair contract. The buyer must prove the contractual relationship, and the breach of contract by the seller, and may seek compensation up to 30,000 Singapore dollars.
○ The Lemon Law provision added to the CPFTA provides for presumption of non-conformity of goods within 6 months from the date of delivery, thereby expanding the scope of relief for consumers.
○ Under Singapore’s tort law, the manufacturer bears product liability when the consumer did not have sufficient opportunity to inspect the product before sale and use of it, and when the manufacturer’s duty of care could have prevented the defect and the injury which the consumer suffered therefrom. The consumer bears the burden of proving the product’s defect, manufacturer’s negligence, and injury which is compensable. The consumer’s contributory negligence or assumption of risk may be used as the manufacturer’s defence.
○ Singapore’s product liability laws are under the jurisdiction of the MInistry of Trade and Industry, and consumer groups such as CASE are actively involved in consumer activities.
○ Product liability disputes in Singapore may, depending on the amount in dispute, fall under the jurisdiction of Small Claims Court.
Ⅲ. Expected Effects
□ This research is expected to contribute to the collection and distribution of the legal information of Asia by studying and analyzing Taiwan and Singapore’s product liability laws.
□ This research is expected to provide legal information to the businesses expanding to Taiwan and Singapore, as well as to the government of Korea.