1. Market surveillance Regulation (EU) 2019/1020 – A guide for economic operator on their obligations for imported products
This article is meant to summarise how Regulation (EU) 2019/1020 (replacing Regulation (EU) 765/2008) has introduced and added functions to the internal market. It defines additional requirements that need to be met for products to be deemed compliant; these requirements are related to an entity defined as the “Economic Operator.” To facilitate the creation of these operators within the market, an operator called “Authorised Representative” is defined. The benefit of such a representative is that they can accomplish the requirements for an “Economic Operator” without being a part of the supply-chain of the product.
The UK is not covered by Regulation 2019/1020, but similar legislation has been implemented for products entering the Great Britain market. A section at the end of this article will summarise these rules.
The article hopefully gives a general understanding of the regulation. We hope that it can answer such questions as:
- Is my company/product affected by this regulation?
- What are my options for achieving compliance with the regulation?
- What are the benefits of using an Authorised Representative?
- What should I be aware of as a part of the supply chain for imported goods?
2. Regulation (EU) 2019/1020
As of July 16th, 2021, the EU regulation 2019/1020 is in force. The regulation set requirements for all products under certain harmonised legislation to have an associated economic operator within the EU. These requirements create a need for many non-EU manufacturers and distributors to either establish themselves in the EU, or cooperate with an economic actor already established within the EU. In addition it adds a requirement that the Fulfilment Service Providers (FSP) automatically pick up the role of the economic operator and the FSP need to fulfil the legal obligations laid out in the regulation, if the manufacturer selling the product through the FSP has not appointed another economic operator of the product.
The regulation defines the economic operator “Authorised Representative” (AR) to facilitate the additional need for EU-operators. Other legislations have previously defined the possible use of an AR for their specific cases, such as the CPR, but this regulation creates a more general or minimum definition of what tasks an AR can/must perform. Definitions of AR in other legislations could now be considered additional tasks that an AR can/must perform.
This regulation aims to strengthen the market surveillance for products imported into the EU. This should create a more level playing field for manufacturers of compliant products produced both within and outside the EU, which will achieve the end-goal of creating a safer market for the consumers and other end-users.
The scope of the regulation is defined by products under “certain Union harmonisation legislation” as defined in Annex 1. In essence, these cover most product-related legislations.
All products under these legislations must, as previously stated, have an economic operator within the EU, and the products must also be labelled with the information of this operator. So, it does not just change the bureaucratic side of the products, but also requires the information to reach the consumer or end-user.
3. Economic operators
The regulation defines 5 different economic actors, all established within the EU. They are the manufacturer, the authorised representative, the importer, the distributor, and the fulfilment service provider. But the requirements would apply to other natural or legal persons subject to obligations concerning the manufacture, placing on the market or putting into service products, in other relevant legislations.
For all product under this regulation, at least one of these economic operators needs to be involved in complying with the requirements laid out in the regulation, see (4)
Manufacturers established in the EU. These manufacturers are unaffected by this regulation as they already obliged to label their products with their contact information.
Importers are defined as any legal or natural person within the EU who places a product from a non-EU country on the market.
Distributors are any legal or natural person besides the manufacturer and importer that places a product on the market.
3.4. Fulfillment service providers
Fulfillment service providers are actors that within the course of commercial activity provide at least two of the following services for a product without having ownership of the product:
Postal services, parcel delivery services and freight transport services are excluded from this definition.
3.5. Authorised representative
ARs are any natural or legal person within the EU that has a written agreement with a manufacturer, to act on their behalf as determined within this regulation, other legislation and the agreement.
The role of AR is further explained below (5).
4. Obligations of the economic operator
The obligations placed upon the economic operator in the EU (importer, AR, or distributor) are to be a sort of “middleman” between the manufacturer and authorities within the EU.
Firstly, the economic operator needs to verify that the manufacturer has drawn up a Declaration of Conformity, Declaration of Performance, and/or technical documentation appropriate for relevant harmonised Union legislation. They need to keep the DoC and/or DoP for the period defined within relevant legislations (commonly 10 years). Also, they must ensure that the technical documentation can be made available if requested by authorities.
Secondly, the economic operator must cooperate with market surveillance authorities (MSA) to demonstrate the product’s compliance by supplying information and documentation at their request. They also must inform the MSA if the product is believed to present a risk. Lastly, they need to take appropriate actions to correct any non-compliant product.
The requirement for labelling the product with the contact information of the economic operator falls on the said operator. But this obligation would most appropriately be defined within the agreement of the manufacturer and the economic operator, depending on the specific case.
5. Authorised representative
As previously stated, the regulation has created a baseline definition for what tasks an AR can/must perform. The purpose of this role is essential for non-EU actors who previously sold directly to consumers in the Union (B2C). For these businesses an AR is an option that requires the least change in how they operate, with no difference in the supply chain. They need to share some documentation and add some labelling to their product (which they would need to do in any case). Because of this simplicity, an AR service is also comparatively cheap to the alternatives.
For businesses that only export products into the EU through importers (B2B), the addition of an AR could seem like it would be an unnecessary extra business partner. The importer (or distributor) could act as their economic operator, but this could potentially have some unforeseen consequences. As the product needs to be labelled with the economic actor, this could limit the product to only be imported through that one importer. A change in importers during the period of manufacturing of the product would mean that a changed label would be needed for all products that were yet to enter the EU. As an AR is not part of the product’s supply chain, choosing an AR as the economic operator would keep the business more flexible to changes in business partners.
It is worth noting that the AR is not responsible for ensuring the product’s compliance. They only need to keep the DoC and/or DoP, and verify that a technical documentation exists. The only liability they have is to alert authorities if they have a reason for believing the product to be non-compliant. So, whenever there is a signal that a product should require a recall or by other means the AR needs to act. In the agreement between the manufacturer and the AR (called “Mandate” in the regulation), the specifics for what tasks the AR are responsible must be defined. This agreement must be made available to MSAs at their request.
6. How does this affect you?
6.1. EU manufacturer
Since you were already required to label your contact information on the product and you are the legal economic actor in the EU, your information is enough, and you do not need to act additionally.
6.2. Non-EU manufacturer
You must assign an economic operator within the EU and label your products accordingly. Until this is accomplished, your products are considered non-compliant.
6.3. EU importer
You should ensure that an economic operator within the EU labels with the products you are importing from outside the EU. You could act as this economic operator.
6.4. EU distributor
You should ensure that the products you distribute are labelled with an economic operator within the EU. You could act as this economic operator.
6.5. EU fulfilment service provider
If the products you are servicing do not already have an appointed economic operator, you will be considered. Therefore, you should ensure that the products you are providing services for are labelled with an economic operator within the EU unless you aim to be the economic operator for the product.
7. Authorised Representative in the UK
In the same manner as the EU, the UK legislation requires that all products that are placed on the GB market (England, Scotland and Wales) must have an economic operator within the UK (GB, Northern Ireland, and other territories).
The main difference is the different areas, where economic operators are identified across the UK; the market is only in GB. Due to the Northern Ireland protocol, Northern Ireland has remained within the EU single market for goods, but a business established there is also considered a UK operator.
To ease the transition into this system, the UK allows that the contact information of the importer or AR is supplied in accompanying documents until 31 December 2022, for products from the EEA and Switzerland. After that date, the same rules apply to the EU. The details must be printed on the product, or on accompanying documents when specific legislation allows it.
Interested to know more?
If you want to know better how Zatisfy can help comply with this regulation, please visit this link, send an email to [email protected] or schedule a free 25 min appointment with one of our experts here.