US and PRC agencies have formed joint working groups to increase scrutiny of specific product lines, including children's products. (China Foto Press)

Product Safety

Product Safety Summit Shows Value of Cooperation

The recent bilateral product safety summit brought the US-China dialogue to a new level, with both parties committing to a more comprehensive approach.

by Michael J. Wagner

The US Consumer Product Safety Commission (CPSC) and the PRC Administration of Quality Supervision, Inspection, and Quarantine (AQSIQ) held the Third Biennial US-China Consumer Product Safety Summit in late October 2009. CPSC Chair Inez Tenenbaum led a delegation that included senior CPSC specialists in compliance, hazard analysis, injury reduction, and international relations, as well as industry stakeholders and business leaders from the United States. AQSIQ Deputy Director Wei Chuanzhong led a similarly high-ranking group of PRC officials. In the week-long series of meetings, the CPSC and AQSIQ delegations discussed the most pressing product safety issues confronting them, their constituencies, and the companies they regulate in the US-China supply chain. The delegations visited AQSIQ's headquarters, toured and inspected Chinese factories and AQSIQ laboratories, negotiated areas of cooperation and common ground, and released a joint statement and plans for future cooperation.

Quick Glance

Improved cooperation between US and PRC officials is leading to better enforcement of—and better compliance with—product safety standards.
China's product safety regime has developed rapidly in the last few years.
Companies must have product safety compliance programs in place.

The summit highlighted ways that Chinese manufacturers and US importers, retailers, and distributors can better comply with product safety rules in the United States and China—from importers playing a greater role in ensuring safe product design to manufacturers verifying that their raw material and component suppliers meet applicable safety standards.

Better cooperation and enforcement

The summit, which took place in Beijing, Shanghai, and Wuxi, Jiangsu, focused on the central theme of "promoting best practices by Chinese manufacturers and US importers to maximize product safety." It built on the achievements of the 2007 summit in Washington, DC, which was held amid a series of highly publicized product recalls that prompted an array of legislative and regulatory changes, including the US Consumer Product Safety Improvement Act of 2008. Since the 2007 summit, CPSC and AQSIQ have worked to ensure that Chinese manufacturers understand the importance of meeting voluntary safety standards and US regulations. According to Deputy Director Wei, AQSIQ has responded to the recent recall crises by educating Chinese manufacturers about the importance of US safety requirements and by closing thousands of factories that failed to meet PRC product quality or safety requirements. Wei also stated that AQSIQ now performs more pre-shipment inspections so that non-compliant, potentially unsafe products are less likely to leave China's ports.

CPSC and AQSIQ officials noted that they communicate with each other more frequently than ever before, conducting monthly video telephone conferences on specific product safety issues and discussing priority projects. They have also formed joint working groups to increase scrutiny of specific product lines, such as electrical products, children's products, all-terrain vehicles (ATVs), drywall, fireworks, and cigarette lighters.

The bottom line for manufacturers, importers, retailers, and distributors is that CPSC and AQSIQ are delving more deeply into product- and industry-specific safety issues.

Regardless of the product involved, the bottom line for manufacturers, importers, retailers, and distributors is that CPSC and AQSIQ are rolling up their sleeves and delving more deeply into product- and industry-specific safety issues. Recall statistics indicate that this increased cooperation among the key stakeholders is improving Chinese manufacturers' product safety track records. As noted by Tenenbaum and John Gibson Mullan, CPSC's assistant executive director of the Office of Compliance and Field Operations, though the number of CPSC recalls of products manufactured or produced in China rose sharply from fiscal year (FY, October 1-September 30) 2000 to FY 2008, that number dropped dramatically from FY 2008 to FY 2009 (see Figure). In 2008, the number of CPSC recalls of products made in China hit an all-time high of 352. Within the next 12 months, the number of recalls of China-sourced products fell 42 percent—to 204—while the number of recalls of products made in the rest of the world rose 48 percent to 98.

The trend was equally noteworthy in perhaps the most highly publicized of all product safety areas—toys. According to CPSC data, in FY 2008, the CPSC and companies working with it announced recalls of more than 80 toy products, nearly half because of excessive lead levels. By the close of FY 2009, the number of recalls had dropped to 40, with only 15 related to lead violations. Many observers believe that the impending effective date of new, more-stringent US lead-paint limits played a key role in the dramatic fall in the number of lead-related toy recalls. In August 2009, the US lead-paint and total lead limits became far more stringent for products marketed to children age 12 and younger, dropping to 90 parts per million for lead paint and 300 parts per million for total lead content.

Stricter safety standards

Tenenbaum reiterated several times during the summit that she considers product safety enforcement a two-way street: CPSC expects Chinese manufacturers to meet tougher US standards, but it will also hold US importers to their obligations to meet US safety requirements and will vigorously pursue US importers that violate standards.

The implications for US importers are clear: They must have a safety or compliance program in place.

The implications for US importers are clear: They must have a safety or compliance program in place, conduct pre-market and production testing to minimize safety risks, and ensure that their China-based suppliers comply with all US safety requirements.

CPSC also promised to clamp down on companies that fail to do so. Mullan highlighted the agency's stepped-up enforcement activities: In 2006, CPSC assessed civil penalties on 6 companies, but by the October 2009 summit, the number topped 40 in 2009 alone.

Communication and transparency are key

At the summit, CPSC and AQSIQ officials agreed to improve consumer product safety, but they did not always agree on how to achieve that goal or on the root cause of the product safety problems. For example, Tenenbaum and Wei agreed on the need for "fact-based, science-based" investigation and analyses of specific product safety challenges. Wei, however, defended the quality and safety of Chinese products and stated that, after Chinese products are exported to the United States, China "faces unfair treatment" because of strict "technical barriers." Tenenbaum countered that CPSC applies its product safety requirements to all companies importing products into the United States and does not hold Chinese companies to a different set of standards. In the end, Tenenbaum and Wei agreed that cooperation and communication could help overcome these obstacles.

A summit day devoted almost exclusively to ATV safety demonstrated that steady progress can be made even in the face of differing Chinese and American perceptions. To reduce the number of fatalities that occur in ATV-related accidents, the US and PRC delegations jointly toured an ATV factory and testing facility and conducted an industry outreach session attended by several dozen Chinese ATV manufacturers. The session's open, town hall question-and-answer format conveyed that CPSC's transparent approach is making headway—not only by answering Chinese manufacturers' technical questions about product safety requirements but also by demonstrating that the US agency is encouraging Chinese manufacturers to contact CPSC directly. (Mullan repeatedly provided his contact information and requested that manufacturers contact him with questions.)

Room for improvement

China's product safety legal regime, which was almost nonexistent a few years ago, now contains national- and local-level laws and regulations on product safety issues in various industry sectors (see Overview of China's Product Safety Regime). These developments demonstrate the PRC government's efforts to establish a comprehensive product safety legal regime.

Despite these significant improvements, China must still catch up to the United States and Europe in terms of legislation and enforcement. Compared with the product safety regimes in those two regions, the PRC regime lacks detailed implementing rules or guidance. In addition, China's product safety industrial standards are incomplete and unable to support the country's fast-developing product safety legal regime. The PRC government must also improve enforcement of the country's product safety regime, including by clarifying the divisions of responsibility between relevant government agencies and improving cooperation and coordination among these agencies. Over time, China will likely bring its product safety regime closer to international practice.

Overview of China's Product Safety Regime

In the last few years, China has enacted important product safety laws and regulations. Companies doing business in—and with—China should acquaint themselves with these developments.

Legislation

China does not have a single, codified product safety law. Manufacturers and sellers of products and other stakeholders in this area must follow legal requirements as set out in various laws and regulations, including the General Principles of the Civil Law, the Law on Protection of the Rights and Interests of Consumers, the Criminal Law, and laws on the Administration of Pharmaceuticals and on Product Quality. China issued important legislation on food and product safety in the past several years, including the Law on the Quality and Safety of Agricultural Products in 2006; several sector-specific regulations covering the recall of vehicles, toys, food, and drugs in 2007; and the Food Safety Law and its implementing rules in 2009, which represented a milestone in the formation of China's product safety regime. These laws and regulations responded to the public's rising concern about product safety in China, which was stimulated by several lurid product safety lapses, including the 2008 melamine-tainted milk scandal (see the CBR, May-June 2009).

Agency responsibilities

The PRC National People's Congress and the State Council have assigned various agencies specific tasks in the regulation and supervision of product quality and safety, although there is some overlap. Central and local-level Administration of Quality Supervision, Inspection, and Quarantine (AQSIQ) offices oversee and regulate the quality and safety of products manufactured in China and products imported into China. The State Administration for Industry and Commerce and its local offices oversee quality and safety issues of all products. Other relevant authorities have the power to supervise product safety in their own industrial sectors. For example, the Ministry of Agriculture handles agricultural product safety, the Ministry of Health is in charge of food safety, and the State Food and Drug Administration manages food and drug safety.

General product safety requirements

Under PRC law, manufacturers must abide by compulsory state and industrial product safety standards with respect to food, drugs, agricultural products, food containers and processors (such as boilers and pressure vessels), and other relevant products. Manufacturers are liable for any personal injuries or property damage caused by product defects. Entities must obtain a government permit to produce or distribute certain regulated products such as vehicles, food, and drugs.

Legal liabilities

Failure to comply with PRC product safety requirements may give rise to civil, administrative, and criminal liabilities.

Civil liability Under PRC law, if a product causes personal injury or property damage, the manufacturer must compensate any loss suffered by the aggrieved party. In addition, manufacturers assume strict legal liability under PRC law, which means that they will be liable regardless of whether there are any defaults on their part, as long as a causal link can be established. Distributors are subject to a lesser liability standard than manufacturers, however. Under PRC law, distributors are liable only if the product defects are the fault of the distributors.
Administrative liability Manufacturers and distributors that fail to comply with product safety requirements face administrative liabilities. The relevant government authorities may impose administrative sanctions on the manufacturers and distributors, including by requesting rectification of defect, imposing fines, ceasing the operation, and revoking the business license.
Criminal liability If the products are found to have caused death, serious personal injury, or serious property damage, the responsible manufacturers and distributors may be exposed to criminal liability. The responsible management personnel of the manufacturers or distributors may also be criminally liable.

Product recalls

Manufacturers and distributors must recall products if consumers complain about product defects or if the manufacturers and distributors are aware of defects that may cause personal injury or property damage. In the past several years, the PRC government has issued regulations on the recall of vehicles, drugs, food products, and toys. PRC law currently does not contain specific rules governing recall procedures of other products, though this may change soon. In April 2009, the State Council issued for comment draft Administrative Regulations on the Recall of Defective Products, which aim to address recall procedures for all products. According to the current draft, the manufacturer must conduct a product safety investigation if it is aware of a product defect and must recall products that contain defects that may harm human health and life. The draft also lists the requirements and procedures for manufacturers to recall such defective products. The final regulations will likely be issued this year.

—Barbara Li

Barbara Li (barbara.li@bakernet.com) is a partner in Baker & McKenzie LLP's Beijing office.

Beyond the Summit: Product Safety Best Practices

The US-China Consumer Product Safety Summit highlighted the steps that companies selling products in the United States can take to reduce their legal exposure and their brand and reputational risks. The US Consumer Product Safety Commission (CPSC) cited some of these steps during the summit; others are the result of years of evolving good-manufacturing practices and solid risk-management and compliance policies. A few of the many best-practice tips that manufacturers, importers, retailers, and distributors navigating this changing legal and regulatory landscape should consider follow.

Always conduct due diligence on potential partners. Ask for written confirmation of supply sources, subcontractors, and subcontractors' supply sources. Companies should also require suppliers to document, and share information concerning, their supplies of raw materials and components, as well as all outsourcing of manufacturing. One defective component can put an entire product line at risk.
Have a solid product safety compliance policy in place. CPSC expects companies to have and implement compliance policies, and companies without them face much higher civil penalties if a product safety problem occurs.
Exercise audit rights often and retain the right to conduct audits of all suppliers without advance notice or announcement.
Implement a robust, state-of-the-art, product-safety testing program and require copies of all results from suppliers. Companies should follow up promptly on adverse results to address problems early.
Ensure that products are adequately identified when made, so they can be traced and tracked if a recall becomes necessary. Failing to do so greatly complicates recalls, often making them much broader than would otherwise be necessary. Companies should be familiar with new CPSC labeling and tracking requirements for children's products in particular.
Require others in the supply chain, especially manufacturers, to preserve all documentation and to cooperate fully if a recall or product safety investigation is initiated.
Consider appropriate indemnification and insurance coverage to mitigate risks and ensure that the responsible parties are held accountable.

—Michael J. Wagner

Michael J. Wagner (mwagner@bakernet.com) is a partner in Baker & McKenzie's Chicago office. He participated as a stakeholder delegate in the US-China Consumer Product Safety Summit in China in October 2009 and is a co-editor of the second edition of Baker & McKenzie's Global Product Recall Handbook.

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	US and PRC agencies have formed joint working groups to increase scrutiny of specific product lines, including children's products. (China Foto Press) Print Article Product Safety Product Safety Summit Shows Value of Cooperation The recent bilateral product safety summit brought the US-China dialogue to a new level, with both parties committing to a more comprehensive approach. by Michael J. Wagner The US Consumer Product Safety Commission (CPSC) and the PRC Administration of Quality Supervision, Inspection, and Quarantine (AQSIQ) held the Third Biennial US-China Consumer Product Safety Summit in late October 2009. CPSC Chair Inez Tenenbaum led a delegation that included senior CPSC specialists in compliance, hazard analysis, injury reduction, and international relations, as well as industry stakeholders and business leaders from the United States. AQSIQ Deputy Director Wei Chuanzhong led a similarly high-ranking group of PRC officials. In the week-long series of meetings, the CPSC and AQSIQ delegations discussed the most pressing product safety issues confronting them, their constituencies, and the companies they regulate in the US-China supply chain. The delegations visited AQSIQ's headquarters, toured and inspected Chinese factories and AQSIQ laboratories, negotiated areas of cooperation and common ground, and released a joint statement and plans for future cooperation. Quick Glance Improved cooperation between US and PRC officials is leading to better enforcement of—and better compliance with—product safety standards. China's product safety regime has developed rapidly in the last few years. Companies must have product safety compliance programs in place. The summit highlighted ways that Chinese manufacturers and US importers, retailers, and distributors can better comply with product safety rules in the United States and China—from importers playing a greater role in ensuring safe product design to manufacturers verifying that their raw material and component suppliers meet applicable safety standards. Better cooperation and enforcement The summit, which took place in Beijing, Shanghai, and Wuxi, Jiangsu, focused on the central theme of "promoting best practices by Chinese manufacturers and US importers to maximize product safety." It built on the achievements of the 2007 summit in Washington, DC, which was held amid a series of highly publicized product recalls that prompted an array of legislative and regulatory changes, including the US Consumer Product Safety Improvement Act of 2008. Since the 2007 summit, CPSC and AQSIQ have worked to ensure that Chinese manufacturers understand the importance of meeting voluntary safety standards and US regulations. According to Deputy Director Wei, AQSIQ has responded to the recent recall crises by educating Chinese manufacturers about the importance of US safety requirements and by closing thousands of factories that failed to meet PRC product quality or safety requirements. Wei also stated that AQSIQ now performs more pre-shipment inspections so that non-compliant, potentially unsafe products are less likely to leave China's ports. CPSC and AQSIQ officials noted that they communicate with each other more frequently than ever before, conducting monthly video telephone conferences on specific product safety issues and discussing priority projects. They have also formed joint working groups to increase scrutiny of specific product lines, such as electrical products, children's products, all-terrain vehicles (ATVs), drywall, fireworks, and cigarette lighters. The bottom line for manufacturers, importers, retailers, and distributors is that CPSC and AQSIQ are delving more deeply into product- and industry-specific safety issues. Regardless of the product involved, the bottom line for manufacturers, importers, retailers, and distributors is that CPSC and AQSIQ are rolling up their sleeves and delving more deeply into product- and industry-specific safety issues. Recall statistics indicate that this increased cooperation among the key stakeholders is improving Chinese manufacturers' product safety track records. As noted by Tenenbaum and John Gibson Mullan, CPSC's assistant executive director of the Office of Compliance and Field Operations, though the number of CPSC recalls of products manufactured or produced in China rose sharply from fiscal year (FY, October 1-September 30) 2000 to FY 2008, that number dropped dramatically from FY 2008 to FY 2009 (see Figure). In 2008, the number of CPSC recalls of products made in China hit an all-time high of 352. Within the next 12 months, the number of recalls of China-sourced products fell 42 percent—to 204—while the number of recalls of products made in the rest of the world rose 48 percent to 98. The trend was equally noteworthy in perhaps the most highly publicized of all product safety areas—toys. According to CPSC data, in FY 2008, the CPSC and companies working with it announced recalls of more than 80 toy products, nearly half because of excessive lead levels. By the close of FY 2009, the number of recalls had dropped to 40, with only 15 related to lead violations. Many observers believe that the impending effective date of new, more-stringent US lead-paint limits played a key role in the dramatic fall in the number of lead-related toy recalls. In August 2009, the US lead-paint and total lead limits became far more stringent for products marketed to children age 12 and younger, dropping to 90 parts per million for lead paint and 300 parts per million for total lead content. Stricter safety standards Tenenbaum reiterated several times during the summit that she considers product safety enforcement a two-way street: CPSC expects Chinese manufacturers to meet tougher US standards, but it will also hold US importers to their obligations to meet US safety requirements and will vigorously pursue US importers that violate standards. The implications for US importers are clear: They must have a safety or compliance program in place. The implications for US importers are clear: They must have a safety or compliance program in place, conduct pre-market and production testing to minimize safety risks, and ensure that their China-based suppliers comply with all US safety requirements. CPSC also promised to clamp down on companies that fail to do so. Mullan highlighted the agency's stepped-up enforcement activities: In 2006, CPSC assessed civil penalties on 6 companies, but by the October 2009 summit, the number topped 40 in 2009 alone. Communication and transparency are key At the summit, CPSC and AQSIQ officials agreed to improve consumer product safety, but they did not always agree on how to achieve that goal or on the root cause of the product safety problems. For example, Tenenbaum and Wei agreed on the need for "fact-based, science-based" investigation and analyses of specific product safety challenges. Wei, however, defended the quality and safety of Chinese products and stated that, after Chinese products are exported to the United States, China "faces unfair treatment" because of strict "technical barriers." Tenenbaum countered that CPSC applies its product safety requirements to all companies importing products into the United States and does not hold Chinese companies to a different set of standards. In the end, Tenenbaum and Wei agreed that cooperation and communication could help overcome these obstacles. A summit day devoted almost exclusively to ATV safety demonstrated that steady progress can be made even in the face of differing Chinese and American perceptions. To reduce the number of fatalities that occur in ATV-related accidents, the US and PRC delegations jointly toured an ATV factory and testing facility and conducted an industry outreach session attended by several dozen Chinese ATV manufacturers. The session's open, town hall question-and-answer format conveyed that CPSC's transparent approach is making headway—not only by answering Chinese manufacturers' technical questions about product safety requirements but also by demonstrating that the US agency is encouraging Chinese manufacturers to contact CPSC directly. (Mullan repeatedly provided his contact information and requested that manufacturers contact him with questions.) Room for improvement China's product safety legal regime, which was almost nonexistent a few years ago, now contains national- and local-level laws and regulations on product safety issues in various industry sectors (see Overview of China's Product Safety Regime). These developments demonstrate the PRC government's efforts to establish a comprehensive product safety legal regime. Despite these significant improvements, China must still catch up to the United States and Europe in terms of legislation and enforcement. Compared with the product safety regimes in those two regions, the PRC regime lacks detailed implementing rules or guidance. In addition, China's product safety industrial standards are incomplete and unable to support the country's fast-developing product safety legal regime. The PRC government must also improve enforcement of the country's product safety regime, including by clarifying the divisions of responsibility between relevant government agencies and improving cooperation and coordination among these agencies. Over time, China will likely bring its product safety regime closer to international practice. Overview of China's Product Safety Regime In the last few years, China has enacted important product safety laws and regulations. Companies doing business in—and with—China should acquaint themselves with these developments. Legislation China does not have a single, codified product safety law. Manufacturers and sellers of products and other stakeholders in this area must follow legal requirements as set out in various laws and regulations, including the General Principles of the Civil Law, the Law on Protection of the Rights and Interests of Consumers, the Criminal Law, and laws on the Administration of Pharmaceuticals and on Product Quality. China issued important legislation on food and product safety in the past several years, including the Law on the Quality and Safety of Agricultural Products in 2006; several sector-specific regulations covering the recall of vehicles, toys, food, and drugs in 2007; and the Food Safety Law and its implementing rules in 2009, which represented a milestone in the formation of China's product safety regime. These laws and regulations responded to the public's rising concern about product safety in China, which was stimulated by several lurid product safety lapses, including the 2008 melamine-tainted milk scandal (see the CBR, May-June 2009). Agency responsibilities The PRC National People's Congress and the State Council have assigned various agencies specific tasks in the regulation and supervision of product quality and safety, although there is some overlap. Central and local-level Administration of Quality Supervision, Inspection, and Quarantine (AQSIQ) offices oversee and regulate the quality and safety of products manufactured in China and products imported into China. The State Administration for Industry and Commerce and its local offices oversee quality and safety issues of all products. Other relevant authorities have the power to supervise product safety in their own industrial sectors. For example, the Ministry of Agriculture handles agricultural product safety, the Ministry of Health is in charge of food safety, and the State Food and Drug Administration manages food and drug safety. General product safety requirements Under PRC law, manufacturers must abide by compulsory state and industrial product safety standards with respect to food, drugs, agricultural products, food containers and processors (such as boilers and pressure vessels), and other relevant products. Manufacturers are liable for any personal injuries or property damage caused by product defects. Entities must obtain a government permit to produce or distribute certain regulated products such as vehicles, food, and drugs. Legal liabilities Failure to comply with PRC product safety requirements may give rise to civil, administrative, and criminal liabilities. Civil liability Under PRC law, if a product causes personal injury or property damage, the manufacturer must compensate any loss suffered by the aggrieved party. In addition, manufacturers assume strict legal liability under PRC law, which means that they will be liable regardless of whether there are any defaults on their part, as long as a causal link can be established. Distributors are subject to a lesser liability standard than manufacturers, however. Under PRC law, distributors are liable only if the product defects are the fault of the distributors. Administrative liability Manufacturers and distributors that fail to comply with product safety requirements face administrative liabilities. The relevant government authorities may impose administrative sanctions on the manufacturers and distributors, including by requesting rectification of defect, imposing fines, ceasing the operation, and revoking the business license. Criminal liability If the products are found to have caused death, serious personal injury, or serious property damage, the responsible manufacturers and distributors may be exposed to criminal liability. The responsible management personnel of the manufacturers or distributors may also be criminally liable. Product recalls Manufacturers and distributors must recall products if consumers complain about product defects or if the manufacturers and distributors are aware of defects that may cause personal injury or property damage. In the past several years, the PRC government has issued regulations on the recall of vehicles, drugs, food products, and toys. PRC law currently does not contain specific rules governing recall procedures of other products, though this may change soon. In April 2009, the State Council issued for comment draft Administrative Regulations on the Recall of Defective Products, which aim to address recall procedures for all products. According to the current draft, the manufacturer must conduct a product safety investigation if it is aware of a product defect and must recall products that contain defects that may harm human health and life. The draft also lists the requirements and procedures for manufacturers to recall such defective products. The final regulations will likely be issued this year. —Barbara Li Barbara Li (barbara.li@bakernet.com) is a partner in Baker & McKenzie LLP's Beijing office. Beyond the Summit: Product Safety Best Practices The US-China Consumer Product Safety Summit highlighted the steps that companies selling products in the United States can take to reduce their legal exposure and their brand and reputational risks. The US Consumer Product Safety Commission (CPSC) cited some of these steps during the summit; others are the result of years of evolving good-manufacturing practices and solid risk-management and compliance policies. A few of the many best-practice tips that manufacturers, importers, retailers, and distributors navigating this changing legal and regulatory landscape should consider follow. Always conduct due diligence on potential partners. Ask for written confirmation of supply sources, subcontractors, and subcontractors' supply sources. Companies should also require suppliers to document, and share information concerning, their supplies of raw materials and components, as well as all outsourcing of manufacturing. One defective component can put an entire product line at risk. Have a solid product safety compliance policy in place. CPSC expects companies to have and implement compliance policies, and companies without them face much higher civil penalties if a product safety problem occurs. Exercise audit rights often and retain the right to conduct audits of all suppliers without advance notice or announcement. Implement a robust, state-of-the-art, product-safety testing program and require copies of all results from suppliers. Companies should follow up promptly on adverse results to address problems early. Ensure that products are adequately identified when made, so they can be traced and tracked if a recall becomes necessary. Failing to do so greatly complicates recalls, often making them much broader than would otherwise be necessary. Companies should be familiar with new CPSC labeling and tracking requirements for children's products in particular. Require others in the supply chain, especially manufacturers, to preserve all documentation and to cooperate fully if a recall or product safety investigation is initiated. Consider appropriate indemnification and insurance coverage to mitigate risks and ensure that the responsible parties are held accountable. —Michael J. Wagner Michael J. Wagner (mwagner@bakernet.com) is a partner in Baker & McKenzie's Chicago office. He participated as a stakeholder delegate in the US-China Consumer Product Safety Summit in China in October 2009 and is a co-editor of the second edition of Baker & McKenzie's Global Product Recall Handbook. Further Reading Careful Contracts Reduce Risk Ethical Supply Chain Management Managing Brands through Supply Chain Visibility Copyright 2010 US-China Business Council Top of Page Table of Contents
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