U.S. consumer product safety laws apply to U.S. and non-U.S. companies alike

U.S. consumers expect that the products they purchase have been tested and deemed safe by manufacturers and federal regulatory agencies. In the event that a product is found by a maker or manufacturer to be defective or dangerous in any way, the problem must be reported to the U.S. Consumer Product Safety Commission, which then takes steps to investigate the claims. The safety and very lives of U.S. consumers depend upon adherence to and compliance with this process and U.S. consumer product safety laws.

These same safety regulations must be followed by foreign product makers and manufacturers that wish to market and sell their products in the U.S. either directly or via U.S. retailers. This issue is one that is central to a $15 million civil penalty that was recently issued by the CPSC against the Chinese company Gree Electric Appliances Inc.

According to an ABC News story, from 2005 to 2013, Gree Electric Appliances Inc. sold its appliance products “under 13 different brands” at popular online and in-store retailers. During this time period, the company received reports from consumers that the dehumidifiers were smoking, sparking, and even catching fire. According to the CPSC, an estimated $4.5 million in property damage resulted from the faulty dehumidifiers.

Equally, if not more troubling was Gree’s response to the complaints. According to the CPSC, the Chinese company failed to notify the agency of any complaints or potential defects and instead “continued to sell the dehumidifiers with the known defect.” What’s more, after the CPSC got wind of and began investigating the consumer complaints, Gree attempted to downplay the product’s dangers and “also then quietly changed the product to make it safer, again without notifying U.S. safety officials.”

Recalls for the dehumidifiers were finally issued in 2013 and 2014. The sizable civil fine issued by CPSC is meant in part to send a message to both U.S. and non-U.S. makers of consumer products that there will be serious repercussions for companies that fail to comply with U.S. consumer safety regulations.

Source: ABC News, “US: Appliance Co. Lied About Dangerous, Fiery Defect,” Cindy Galli, March 25, 2016

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