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

The grounds for product liability make clear that risks are faced by those involved in the supply chain of a product, such as in robot manufacturing, in respect of their liability to the public, and to others in the chain, for sub-standard/defective or dangerous products. There are various ways in which these risks can be managed, including contractual protections, insurance and risk management.

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

It is important to ensure that the terms of the contracts to which a robot manufacturing company is party protect it, as far as possible, from the risk of product liability claims. A company will want to have the right to reclaim from the company above it in the supply chain, any loss that has been caused by that company’s product or actions. Conversely, a company may wish to limit its liability to other parties below it in the supply chain. A company may also want to impose contractual obligations on key suppliers to ensure that they comply with quality and safety standards.

There are various ways that robot manufacturing companies can do this. In general, parties to a contract have the option of limiting or excluding their liability for certain things. However, when it comes to product liability, there are restrictions on limiting liability for dangerous or defective products. It is therefore important to also consider non-contractual provisions that can protect a company from this 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?

It is important to have an effective quality assurance programme in place. Especially when dealing with a highly automated product, such as in robot manufacturing. Appropriate internal controls, checks and processes are necessary to monitor product safety. One option is to put in place a product safety committee internally, which should include a range of personnel within the company, including people from the legal, marketing, production and design teams. 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.

Other steps that a company can take are to ensure quality assurance records are maintained and are readily accessible and to keep good records of who supplied each part of the product.

Is there an effective enquiries and complaints system in place?

The ability of a robot manufacturing company to effectively capture and respond to safety information provided by customers, or other individuals, is important for ensuring both product safety and limiting product liability exposure. There are several points to be considered:

  • 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?

When a robot manufacturing company provides services along with products (for example, repairs or advice), duties existed before Brexit, under the Services Directive (2006/123/EC), to inform customers of how to make complaints and to deal with complaints promptly and fairly. The Services Directive is implemented in the UK by the Provision of Services Regulations 2009 (SI 2009/2999) (PSRs). The PSRs apply to the majority of private sector businesses in the UK providing services to consumers. Under the PSRs, a trader must provide consumers with certain information about itself and deal with customer complaints promptly.

The Services Directive was revoked immediately after the Brexit transition period ended on 31 December 2020. The PSRs, however, are still in force as retained EU law but were amended by the Provision of Services (Amendment etc.) (EU Exit) Regulations (SI 2018/1329). The amendments revoked EEA-specific provisions in the PSRs that implemented or reflected cross-border, intra-EU provisions of the Services Directive. Most importantly for service providers is the removal of the provisions that prohibited certain service providers from discriminating against customers on the basis of their place of residence. In practice, this means that a business that supplies services to customers in the UK can treat non-UK customers differently. The provisions in the PSRs requiring businesses to provide certain information to customers and to respond to complaints remain in place.

Is there an “early warning” system in place?

Robot manufacturing companies need to be alert to the early warning signs of situations that may lead to safety issues, regulatory action or develop into product liability claims. The key question to consider in these circumstances is whether an incident concerns product safety rather than quality alone, for example:

  • Can the product be returned for examination or testing?
  • Was the adverse event foreseen and covered by warnings?
  • Was the product being used contrary to instructions?
  • Could the adverse event occur again?
  • How serious is the risk and what categories of users might be at risk?

It is often prudent to require robot manufacturing company suppliers to notify the company immediately about defect reports, claims made against them or significant safety information relating to goods they supply to the company. A company’s distributors should also be required to report similar information relating to the company’s products.

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