European Business Law, the fourth volume in our series, shows how the European authorities simultaneously abolish all restrictions on access to and exercise of economic activities and support the growth of domestic markets, through the harmonization the internal legislation or the enactment of genuinely unified regulations.

European Business Law

Article 7 of the directive lists the causes of exemption which, in addition to the injured person's fault , mitigate the principle of no-fault liability of the producer of a defective product, established by Article 1. Thus, the producer must prove that he did not put the product into circulation; or that the defect which caused the damage did not exist at the time when the product was put into ci …

Grounds of exemption

Article 7 of the directive lists the causes of exemption which, in addition to the injured person's fault , mitigate the principle of no-fault liability of the producer of a defective product, established by Article 1. Thus, the producer must prove that he did not put the product into circulation; or that the defect which caused the damage did not exist at the time when the product was put into circulation by him or that this defect came into being afterwards; or that the product was neither manufactured by him for sale or any form of distribution for economic purpose nor manufactured or distributed by him in the course of his business; or that the defect is due to compliance of the product with mandatory regulations issued by the public authorities; or that the state of scientific and technical knowledge at the time when he put the product into circulation was not such as to enable the existence of the defect to be discovered; or in the case of a manufacturer of a component, that the defect is attributable to the design of the product in which the component has been fitted or to the instructions given by the manufacturer of the product. Those cases of exemption, which are exhaustively listed, are to be interpreted strictly in order to protect the interests of victims of damage caused by a defective product .

The benefit of exemption resulting from the fact that the product has not been put into circulation may be claimed by the producer only if a third party has caused the product to leave the process of manufacture or where the product has been used contrary to the producer's intention, in particular before the end of the process of manufacture, or for private purposes, which is manifestly not the case where it has been used during the provision of a specific medical service . A product must be considered as having been put into circulation where it leaves the production process operated by the producer and enters a marketing process in the form in which it is offered to the public in order to be used or consumed. However, when the link in the distribution chain which has put the product on the market is closely connected to the producer, it is necessary to establish whether this entity is in reality involved in the manufacturing process of the product concerned. If the two undertakings carry out different production activities, the transfer of the product from one to the other of those entities does not amount to putting it into circulation within the meaning of Article 7. Conversely, if these are undertakings one of which, i.e. the subsidiary company, acts simply as a distributor or depository for the product manufactured by the parent company, the transfer of the product from one to the other entity amounts to the putting into circulation referred to by the directive .

The producer's exemption from liability where an activity has no economic purpose during the manufacture of the product implies a purely charitable activity. A medical service does not answer to that requirement, even if the victim of the damage has not paid for it, where it has been financed from public funds .

The state of technical and scientific knowledge available when the product was put into circulation, sometimes designated as the exception relating to the development risks, means, according to the Court, the most advanced level of science and not only rules resulting from the practices and safety standards in use in the industrial sector in which the producer is operating. The knowledge is not further limited to what the producer in question actually or subjectively was or could have been aware of but includes the objective state of scientific and technical knowledge of which the producer is presumed to have been informed, insofar as it has been accessible at the time when the product was put into circulation . However, subject to compliance with a prior notification procedure, Article 15 of the directive gives the Member States the possibility to retain the liability of the producer even if he proves that the state of scientific and technical knowledge at the time when he put the product into circulation was not such as to enable the existence of a defect to be discovered. By contrast, no additional constraints may be imposed on the producer, such as the obligation to prove that he has implemented a procedure intended to avert the consequences of a defective product . 

Directive No 85/374/EEC, Article 8(2): "The liability of the producer may be reduced or disallowed when, having regard to all the circumstances, the damage is caused both by a defect in the product and by the fault of the injured person or any person for whom the injured person is responsible."

Case C-203/99 Veedfald [2001] ECR I-3569, LawLex200900001108JBJ; Case C-127/04 O'Byrne [2006] ECR I-1313, LawLex200900000473JBJ.

Case C-203/99 Veedfald [2001] ECR I-3569, LawLex200900001108JBJ.

Case C-127/04 O'Byrne [2006] ECR I-1313, LawLex200900000473JBJ.

Case C-300/95 Commission v United Kingdom [1997] ECR I-2649, LawLex200900002170JBJ.

Case C-52/00 Commission v France [2002] ECR I-3827, LawLex200900001029JBJ.

European Business Law

226. Grounds of exemption

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

226. Grounds of exemption

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

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au contenu exclusif Livv – juristes d’entreprise