Canadian Lawyer InHouse

Feb/Mar 2011

Legal news and trends for Canadian in-house counsel and c-suite executives

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Safety first Reforms scheduled to streamline product recalls to enforce cross-border and global responsibility. By Judy van Rhijn R esponsibility for consumer safety will not stop at the border under Canada's new con- sumer product legislation. After several attempts, the federal government has found the political will to bring Canada in line with international markets, giving the Ministry of Health a swathe of new powers to order mandatory recalls and forced testing and compliance. To facilitate the new regime, it has imposed reporting and record- keeping obligations that may prove chal- lenging for foreign companies distributing their products in Canada and Canadian companies that import foreign goods. Parliament approved the Canada Consumer Product Safety Act in December, following the third attempt to modernize the Hazardous Products Act, with Bill C-36 replacing Bill C-6 and Bill C-51. Pamela Fuselli, executive direc- tor of Safe Kids Canada, which runs the National Injury Prevention Program of SickKids Hospital in Toronto, believes it is long overdue. "The current Hazardous Products Act is over 40 years old, which is problematic in itself. The global picture of the marketplace has changed significantly since then, with cross-border shopping and shopping on the Internet. If there's a similar standard for all the marketplace, it will be a lot easier." There have previously been revisions of the legislation but never an overhaul like this. "The approach in Canada up until now has not been from a safety per- spective," says Fuselli. "It has been more focused on how to get products into the marketplace as quickly as possible. The new act will prohibit products that pose an unreasonable danger. It takes it from a protective perspective, not the opposite." The legislation applies not only to local manufacturers, distributors, and retailers, but is triggered by the act of importa- tion as well. The requirements for record keeping will apply to companies inside and outside Canada, and the obligation to report actual and potential incidents cover situations that occur anywhere in the world. Despite the new obligations, the legis- lation is getting enthusiastic support from local industry groups. Carla Ventin, vice president of federal government affairs at Food & Consumer Products of Canada, says her membership is very pleased that it will lead them into alignment with international markets. "It is important that we align with other countries on the world stage and how they do things," she says. Elizabeth McNaughton of Blake Cassels & Graydon LLP in Toronto is already seeing a lot of liaisons between American and Canadian product-safe- ty counterparts, with some joint recalls being made. "This makes our law closer to U.S. law with its mandatory reporting and mandatory recalls," she says, "but it's still important to remember that there are spe- cific Canadian requirements that are not always consistent with U.S. requirements. The [Canadian] consumer product safety act doesn't change other legislation such as French-language labelling requirements." To counter this concern, the government is considering exemptions that will allow the importation of something that is not compliant subject to requirements to make it compliant. "That's obviously help- ful," says McNaughton. The main thrust of the new act is for the regulation of general consumer products. "It covers all products sold to consumers that are not regulated under specific legislation," adds McNaughton. "The main thing that is of concern to the public is toys, which have not been heavily regulated up to now." Fuselli reports that product-related injuries are frequent and often serious. INHOUSE FEBRUARY 2011 • 31

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