Rethinking Product Liability Rules for Online Marketplaces: A Comparative Perspective
2021 Consumer Law Scholars Conference in Boston (March 4-5, 2021)
43 Pages Posted: 16 Feb 2021 Last revised: 21 Feb 2021
Date Written: February 10, 2021
Over the past decade, the rise of online marketplaces such as Amazon.com has profoundly changed the retail landscape. The current pandemic has further accelerated consumers’ shift towards online buying in general and online marketplaces in particular. As a result, traditional distribution chains have been replaced by a market structure which is dominated by digital intermediaries. While this development has increased consumer choice, it has also enabled the influx of unsafe and defect products to US and EU consumer retail markets. It is a matter of controversy whether and how product liability rules, which have been designed for the traditional distribution chain model, can be applied to online intermediaries. Against this background, this Article explores how courts and lawmakers on both sides of the Atlantic are trying to adjust the existing product liability framework to the new reality of the platform economy.
The comparative analysis shows that the regulatory strategies in Europe and the US differ considerably. While US law focusses on indirect regulation through product liability, EU law puts its emphasis on direct regulation through public enforcement of product safety rules and market surveillance by public authorities. In this regard, the proposal for a Digital Services Act, published by the European Commission in December 2020, will not bring much of a change. The Article calls for a reform of the EU Product Liability Directive that takes inspiration from recent developments in US product liability law. This could lead not only to a more balanced regulatory framework within the EU, but also to a trans-Atlantic convergence in the field of product liability. Building on the findings of the comparative analysis, the Article outlines several options for law reform and discusses how the regulatory design of product liability rules could affect the market structure and competition in the platform economy.
The paper will be presented at the 2021 Consumer Law Scholars Conference in Boston (March 4-5, 2021).
Keywords: Product Liability, Product Safety, Online Marketplaces, E-Commerce, Digital Services Act, AB 3262, Bolger v. Amazon, Oberdorf v. Amazon
JEL Classification: K1, K4, K10, K12, K13, K42
Suggested Citation: Suggested Citation