07.06 Product liability

07 Liability Law

An important type of strict liability (see above) is the product liability obligation. Although this liability is only effectively known to a few, it is becoming increasingly important in practice (see below). Product liability in Switzerland is regulated in the Product Liability Act (PrHG, no translation in English). Product liability essentially, but not only, serves consumer protection. In principle, the law makes it easier for consumers to be compensated for damages resulting from product defects.

According to PrHG 1 in connection with PrHG 2, the primary liable party is the manufacturer, i.e. the person who manufactured the end product, a basic substance or a partial product. However, «manufacturer» within the meaning of the law is also any person who claims to be a manufacturer by affixing his name, trademark or other distinguishing mark to the product and thus acts like a manufacturer vis-à-vis customers (quasi-manufacturer). This is often the case today, for example, with the own products of the Swiss retailers Coop and Migros. However, a «manufacturer» within the meaning of the law can also become an importer. Therefore, strict quality control is essential for the importer. Ultimately, everyone in the supply chain is considered a «manufacturer» within the meaning of the law if they are unable to inform the customer of the actual manufacturer within a reasonable period of time.

According to PrHG 3, according to this law, a product is defined as any movable item, even if it forms part of another movable item or of an immovable item. The law explicitly refers to electricity as a movable item. However, according to prevailing doctrine, software, in particular an app, is also considered a product within the meaning of PrHG 3 (in particular HAVE 2017, Barbara Klett, p. 104 ff., with further references).

A prerequisite for liability under the PrHG is damage caused by a defect in a product, whereby the injured party must prove the defect, the damage and an adequate causal connection between the defect and the damage. A product is defective if it does not offer the safety that one is entitled to expect taking all circumstances into account. The manner in which it is presented to the public, the use that can reasonably be expected of it and the time at which it was placed on the market play a role in this regard (PrHG 4). In addition, under PrHG 6, only damages exceeding CHF 900 (i.e. from CHF 901) can be claimed under the PrHG, what corresponds a form of a deductible. Although the law effectively speaks of a «deductible», it is not the case that an injured party must pay this amount in every case. After all, he or she can also claim it conventionally via contractual or non-contractual liability (see above).

The Swiss Product Safety Act (PrSG, no translation in English) also plays an important role in the context of product liability. In addition to product-specific regulations, it defines in general terms the product safety to be expected under the Product Liability Act.

According to PrHG 5, the manufacturer can relieve him/herself/itself or he/she/it is not liable if he/she/it proves that he/she/it did not put the product into circulation, it can be assumed under the circumstances that the defect causing the damage did not exist when he/she/it put the product into circulation, he/she/it did not manufacture the product for sale or any other form of distribution with an economic purpose, nor did he/she/it manufacture or distribute the product in the course of his/her/its commercial activity, the defect is due to the fact that the product complies with binding, state regulations or the defect could not be detected according to the state of science and technology at the time when the product was put into circulation. Furthermore, the manufacturer of a raw material or a subproduct is not liable if he/she/it proves that the defect was caused by the design of the product into which the raw material or the subproduct was incorporated or by the instructions given by the manufaturer of that product.

According to PrHG 8, liability cannot be excluded under this law (mandatory provision!).

Especially because of the product liability under the Product Liability Act, it is enormously important for a potential manufacturer under this Act (see above) to carry out strict quality control of his/shes/its products and he/she/it also absolutely needs an insurance that covers the risk of product liability.

07 Liability Law