Robot Manufacturing: Product Liability Law

Robot manufacturing is a growth industry as the costs of producing robots are going down while the savings in labour costs are rising. With the rise and rise of automation in all areas of life, the word robot has come to mean a wider variety of things. Artificial intelligence (read our blog on some legal issues) has received the most amount of attention recently especially given its crossover with big data (read our blog). But what about the more conventional notion of a robot – the walking, talking lump of steel, more willing to do jobs we’re not so keen on. The sort that product liability law applies to more obviously. This blog covers some issues that a robot manufacturer may encounter when putting such a product on the market.

Robot Manufacturing – product liability and safety risk management

Product liability lies in the accountability faced by a manufacturer of a sub-standard, defective or dangerous product. Such accountability applies to the members of the public who purchase such a product and those below a manufacturer in the supply chain. Contractual protections, insurance and effective risk management can be used to protect a manufacturer from such liability.

Can liability for a dangerous or defective product be excluded or limited?

Contractual protections create a variety of scenarios. Whilst a manufacturer may wish to limit its own liability to parties beneath it in the supply chain, they may well wish to enhance the liabilities of a manufacturer above it. The terms of a contract are the vehicle by which this can be achieved. Additionally a robot manufacturer will want to be certain that quality and safety standards are judiciously applied to every level of its supply chain, especially key suppliers. Given the potential technological complexity of such an industry, it may even be useful to seek the advice of specialist consultants who have the know-how to ensure all the liability that should be attributed to suppliers is and that a comprehensive set of standards is agreed to in the contract.

There are various ways that robot manufacturing companies can do this. Limiting and excluding liabilities within their contracts can be one way – but this is only possible for certain things. There are restrictions on limiting liability for dangerous or defective products. Restrictions that overrule contractual clauses. Robot manufacturers should therefore look to other means, i.e. non-contractual, to control their risk.

Different considerations need to be taken into account when dealing with the various parties within the supply chain. For example, manufacturers, distributors, importers and retailers will all have concerns specific to the role that they undertake.

Is there an effective quality and safety assurance programme in place?

Effective quality assurance is at the heart of non-contractual risk aversion for product manufacturers. This is particularly important in the robot manufacturing industry given that the products usually involve a lot of automation and therefore the blame for something going wrong is more likely to fall on the manufacturers’ shoulders, rather than the customers. Setting up an internal committee to oversee product safety is useful first step. The team should incorporate members from all over the business to ensure nothing is missed. The committee’s function should be: to review products and their associated documents; ensure that all appropriate regulatory and internal procedures have been followed and documented before and after marketing; authorise any necessary action (for example, changing warnings or design); review after-sales monitoring reports for trends and significant incidents; review insurance arrangements.

Additionally, keeping good records of exactly what was supplied when and by whom can simplify such a committee’s job.

Is there an effective enquiries and complaints system in place?

A robot manufacturing company must be able to respond to any complaints or enquiries with regard to a product’s safety. This is a legal requirement as well as being based on a desire to look out for your customers and improve your product. Things to think about: does the company have a system to handle customer enquiries and complaints? If so, could it be improved? Are staff adequately trained? Does the company have a policy of recovering allegedly unsafe items and investigating and recording the items and circumstances? Is there a systematic review of adverse incident information involving multi-disciplinary input from different departments? Can the company identify repeat claimants who may not be genuine?

The Services Directive (2006/123/EC), before Brexit, created an obligation to inform customers of how to make complaints and how manufacturers should deal with such complaints. The Services Directive is implemented in the UK by the Provision of Services Regulations 2009 (SI 2009/2999) (PSRs). The PSRs apply to most product manufacturers in the UK and introduce obligations around how to respond to enquiries or complaints about their products.

After Brexit, the Provision of Services (Amendment etc.) (EU Exit) Regulations (SI 2018/1329) implemented this EU law into UK law. All of the obligations around how to deal with enquiries or complaints essentially remain the same. Although some changes were made to EEA-specific provisions. This included the revocation of a requirement not to discriminate against customers based on their place of residence. This means that manufacturers in the UK could treat customers in the EEA differently to customers in the UK now that we have left the EU. The practical implications of this change are yet to be seen.

Robot Manufacturing – Data protection and privacy

The use of robots (drones being a good example) fitted with cameras or other sensors which can collect personal data such as images of people or vehicle plate numbers, geolocation data or electromagnetic signals relating to an individual’s device (for example, mobile phones, tablets, Wi-Fi routers, and so on) can have privacy implications.

At EU level, there is no data protection legislation specific to the use of robots/drones; the applicable legal framework is contained in the General Data Protection Regulation (EU) 2016/679 (GDPR). In the UK, the processing of personal data via robot/drones is subject to the GDPR and the Data Protection Act 2018 (DPA) and the legal provisions applicable to CCTV systems. After Brexit, the GDPR will be retained in UK law and amended to become the UK GDPR. For more information on data protection after Brexit read our blog.

The GDPR and the DPA set out the conditions under which personal data can be processed and provide for certain exemptions and derogations, the most relevant being:

• Household exemption: This applies to the processing of personal data in the course of a purely personal or household activity. This exemption could potentially apply to individuals using robots/drones for their own purposes. However, the ECJ has narrowly interpreted this exemption in the context of the use of CCTV camera. As a result, its application will depend on the specific circumstances of each case. The Information Commissioner’s Office (ICO), the UK data protection regulator in charge of enforcing GDPR and DPA requirements, has issued guidance in relation to the use of drones. The ICO makes a distinction between the use of drones by “hobbyists” and their use for professional or commercial purposes. Although “hobbyists” would be likely to be exempted from the GDPR and the DPA on the basis of the household exemption, the ICO has provided tips for the responsible use of drones, inviting people to think of privacy considerations and to apply a common sense approach when recording and sharing images captured by a drone.
• Journalistic exemption: In cases where personal data is collected through drones with a view to the publication of some journalistic, academic, artistic or literary material. In this case, processing would, under certain conditions, be exempt from many data protection obligations to the extent that such obligations would be incompatible with the purposes of journalism, academic, literary or artistic purposes which are sought by the processing.

Here to help

Robot manufacturing companies come up against many of the same legal issues as other product manufacturing companies. Having risk assessment procedures in place, as well as mechanisms to deal with potential faults, should reduce liability. However, robots are likely to be able to collect data and so data protection law also becomes important.

EM law specialises in software technology law and contract law. Get in touch if you need advice on Robot Manufacturing or have any questions on the above.