1. M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Working Group for Chapter 28 – Consumer and Health Protection Bilateral screening: Chapter 28 PRESENTATION OF MONTENEGRO Brussels, 15-16 April 2013

2. Chapter 28: Consumer and Health Protection Council Directive 85/374/EEC concerning liability for defective products Zvezdan Čađenović Union of Employees zcadjenovic@yahoo.com M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Chapter 28: CONSUMER AND HEALTH PROTECTION

3. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Content Chapter 28: CONSUMER AND HEALTH PROTECTION  Relevant Acquis  National Legislation  Institutional Framework  Level of transposition (key rules)  Enforcement  Future activities

4. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Relevant acquis  Council Directive 85/374/EEC on the approximation of the laws, regulations and administrative provisions of the Member States concerning liability for defective products, as amended by Directive 1999/34/EC of the European Parliament and of the Council of 10 May 1999 (and corrected by Corrigendum, OJ L 283, 6.11.1999, p. 20 (1999/34)) Chapter 28: CONSUMER AND HEALTH PROTECTION

5. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union National Legislation  Law on Obligations, OG MN No. 47/08, general contract law applicable in B2B, B2C, B2P, and P2P transactions. LoO Art. 175 to 182 are transposing Directive 85/374/EEC;  Law on Consumer Protection, OG RMN No. 26/07 (Art. 96), aims to regulate some of LoO missing provisions (e.g. definition of damage) Chapter 28: CONSUMER AND HEALTH PROTECTION

6. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Institutional Framework  Beside MoE and Authority for Inspection Surveillance, other main institutions and stakeholders: -MoJ, in charge for general contract law and legislative development actions -Courts, individual complaints, Chapter 28: CONSUMER AND HEALTH PROTECTION

7. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Level of transposition (Key rules I) Level of transposition: PARTIAL (including need for revision of wording/terminology in LCP)  Definitions (Art. 176 LoO) -Product – Product shall be any movable thing, as well as an autonomous part incorporated in a movable or immovable thing. Product is electricity and other forms of energy. Chapter 28: CONSUMER AND HEALTH PROTECTION

8. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Level of transposition (Key rules II)  Definitions (Art. 178 (1) to (4) LoO) -Producer - A producer shall be a person who has manufactured a finished product, a person who has produced the raw material, autonomous or dependent part incorporated in the finished product, as well as a person presenting himself as a producer by designating the product by his name, stamp or any other mark of distinction. -If the product is imported, the person who imported the product for the purpose of sale, lease or any other form of placing on the market, shall be considered a producer and shall be solidarily liable with the persons referred to in paragraph 1 of this Article. -Where a producer cannot be identified, any person who has placed the product on the market shall be considered a producer, unless this person has notified the injured party, within a reasonable period of time, of the person from whom he has purchased the product. -The provision referred to in paragraph 3 of this Article shall also apply if it cannot be established who imported the product, including cases when the producer's name or name of a company are specified on the product. Chapter 28: CONSUMER AND HEALTH PROTECTION

9. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Level of transposition (Key rules III)  Definitions (Art. 177 (1) and (2) and Art. 175 (3) LoO) -Defective product - Product shall be defective where, taking into account all the circumstances and especially the manner in which a product is presented, purposes for which it can be reasonably used and the time when it is placed on the market, it does not ensure safety which can reasonably be expected from such a product, including -Product shall not be defective only on grounds that an improved product has subsequently been placed on the market. -Cause (burden of proof) - The injured party shall prove the defect of a product, damage and causality between product defect and damage. Chapter 28: CONSUMER AND HEALTH PROTECTION

10. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Level of transposition (Key rules IV)  General Scope: -LoO provides for specific provisions on producer liability for damages caused from defective product - established as objective liability (regardless of fault of producer). -Rationae materiae vs. rationae personae – scope of protection provided for “injured person”. LoO applicable in B2B, B2C, B2P, and P2P transactions -Case C-285/08 Moteurs Leroy Somer v Dalkia France and Ace Europe -“Directive 85/374 must be interpreted to mean that it does not preclude the interpretation of domestic law or the application of settled domestic case-law according to which an injured person can seek compensation for damage to an item of property intended for professional use and employed for that purpose, where the injured person simply proves the damage, the defect in the product and the causal link between that defect and the damage.” Chapter 28: CONSUMER AND HEALTH PROTECTION

11. M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Chapter 28: CONSUMER AND HEALTH PROTECTION DirectiveLoO did not put the product into circulation√ defect didn`t existed when the product was put into circulation/came into being afterwards √ not manufactured for sale or distribution for economic purpose/ in the course of his business √ compliance with mandatory regulations√ state of scientific and technical knowledge√ manufacturer of a component√ damage caused by a defect in the product and by the fault of the injured person or any person for whom the injured person is responsible √ (“damage is caused exclusively by the action…”) Chapter 28: Consumer and Health Protection Level of transposition (Key rules V) Producers defenses (Art. 180 LoO)

12. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Level of transposition (Key rules VI)  Possibility for Reduction of Producer liability/Contractual clauses (Art. 96 (2) LCP, Art. 180 (3) and Art. 181) -No reduction/exoneration from liability of the producer when the damage is caused both by a defect in product and by the act or omission of a third party. -Partial exoneration (reduction) of the producer from liability if the injured party, or a person for whom that party is liable, has partially contributed to the occurrence of damage.  Producer’s liability can not be exclude or limited in advance with the contract with the injured party. Chapter 28: CONSUMER AND HEALTH PROTECTION

13. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Level of transposition (Key rules VII)  Damage (Art. 96 LCP), low level of harmonization -Two types of Damage: -Caused by death, injury, or damage to health; -Property damage. -Property damage (criteria): -damage or destruction of a product intended for personal use, Chapter 28: CONSUMER AND HEALTH PROTECTION

14. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Level of transposition (Key rules VIII)  Damage to property (Art. 96 LCP), low level of harmonization -No transposition of: -“item of property other than the defective product itself”, -“used by the person who has suffered the loss” -“mainly for his own private use or consumption”; and -threshold lower of 500 Euros (Case C-154/00 Commission v Greece [2002] ECR I- 3879) Chapter 28: CONSUMER AND HEALTH PROTECTION

15. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Level of transposition (Key rules IX)  Recovery of Damages -The injured person has three years to seek compensation, starting from date the plaintiff becomes aware or should reasonably have become aware of the damage, the defect, and the identity of the producer (Art. 182 (1))  Time Limit: -A right to a redress for damage caused by a defective product expires within 10 years from the date of its placing on the market, unless within that period, a procedure before court or some other competent authority has been initiated against the producer for the purpose of establishing or settling the claim for a redress for damage (Art. 182 (2)). Chapter 28: CONSUMER AND HEALTH PROTECTION

16. M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Chapter 28: CONSUMER AND HEALTH PROTECTION DirectiveLCP No restriction on compensation for non-material damage √ No application to injury or damage arising from nuclear accidents X (albeit, Art. 9 of the Constitution – supremacy and direct applicability of international conventions) Option Art. 15 Directive - set a limit for a producer's total liability for damage resulting from death or personal injury caused by identical items with the same defect. This limit may not be lower than € 70 million X Chapter 28: Consumer and Health Protection Level of transposition (Key rules X) Other substantive rules of the Directive

17. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Enforcement I  Courts: -individiual complaints; Chapter 28: CONSUMER AND HEALTH PROTECTION

18. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Future plans  ME in 3 rd and 4 th quarter 2010 initiated a detailed screening of 11 CP directives, including additional measure for Directive 85/374/EEC, supported by IPA 2009 Project (AIM)  Draft new Law on Consumer Protection, in conjunction with LoO secures full harmonization with Directive 85/374/EEC and is ready to be adopted by GoM (Art. 131 Draft LCP): Chapter 28: CONSUMER AND HEALTH PROTECTION

19. Thank you for your attention. QUESTIONS