American University of Sharjah Business Law Presentation

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Consumer Protection: A Comparative Analysis of product liability laws in Japan and China.
Consumer protection is a term that implies the practice of the government through
legislation and laws to safeguard the interests and well fair of the general public or consumers
from exploitation and unfair practices. The concept is evident in numerous nations, including
Japan and China. Both countries have their own set of laws that diverge and converge in certain
areas. Within the concept of consumer protection is the legislation on product liability. The
regulation is crucial as a doctrine that defines the trajectory of actions if a company or
manufacturer is liable for manufacturing or distributing a substandard product. The law may also
require sellers, manufacturers, or distributors to compensate customers for selling defective
goods. Both Japan and China are nations that value the importance of product liability laws. The
law, although protecting customers, is defined and applied differently in both nations. There
needs to be an evident research gap in comparing the definitions and applications of the product
liability laws in Japan and China. The research paper will delve into identifying the similarities
and differences between product liability laws as part of consumer protection in Japan and China
while utilizing primary, secondary, and tertiary sources of information.
Overview of Consumer Protection and Product Liability Laws in Japan
Japan has established a substantial record of implementing measures for safeguarding
consumer interests and enacting laws about product liability. The evolution of consumer
protection in Japan has undergone notable advancements1. The developments of the legislation
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Hironaka and Ichiba “The Product Regulation and Liability Review,” 83
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were mainly evident after the Second World War when companies and industries began to
manufacture and sell goods in large quantities as part of the recovery process. The government
recognized the need to safeguard consumer rights. What followed was an introduction of various
laws and regulations. The implementation of regulations was enacted to guarantee the safety of
goods available in the marketplace. The legal framework that regulates product liability in
contemporary Japan is chiefly dictated by the Product Liability Act, which was instituted in
19942. The act established a system of strict liability. After its enactment, the law allowed
manufacturers and other relevant parties to be held responsible for injuries or damages caused by
defective products. The liability is regardless of fault or negligence. The act defines products as
“movable property that is manufactured or processed” and sets out exceptions for certain
categories, such as real estate and intangibles.
Analysis of the Scope of Product Liability Laws in Japan
In Japan, product liability laws mainly involve tort, contract, and criminal laws. The three
laws are encompassed under Article 709 of the Civil Code. The general rule of tort makes a
person liable for compensating loss or damage. The scope of liability arises when there is a
violation of an individual’s rights or interests concerning products purchased that are safeguarded
by law. Japan’s Product Liability Act enhances the rule by allowing victims of product-related
accidents to seek compensation without proving intent or negligence.3. However, these laws have
certain limitations. They exclude real estate, intangible products like electricity and computer
software, and unprocessed natural products.
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Meti.go.jp “Overview of Japan’s product safety acts”
Hironaka and Ichiba “The Product Regulation and Liability Review,” 83
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The scope of product liability laws in Japan extends to various stakeholders. The
government plays a supervisory role, ensuring adherence to these laws. The laws in question also
extend to encompass manufacturers. Manufacturers must guarantee that their merchandise
fulfills the prescribed benchmarks of excellence and safety. Manufacturers in Japan must also
replace defective products for customers under the warranty agreement covered under the
Consumer Contract Act Law No. 61 of 2000. METI establishes guidelines, conducts inspections,
and provides support to manufacturers and businesses4. The body ensures compliance with
product liability regulations. Manufacturers, distributors, and sellers have distinct roles and
responsibilities under Japanese product liability laws. Manufacturers are held strictly liable for
defects in their manufactured products5. The law in Japan fails to pass the liability of defective
goods to distributors and sellers. Client claims on defective goods can only be made under the
Civil Code on other grounds, including breach of tort or contract.
Findings of the Interview
For the purpose of further analysis of the seriousness of product liability and overall
consumer protection in Japan, I interviewed a business worker living in Dubai who initially
worked in Japan. According to his assertions, a manufacturer is liable for the damages incurred
on the consumers or users of their product arising from the defective product. For example, he
states, “In case of a product defect or a safety concern with the product, the company must report
it to the authority.” He emphasizes that “consumer safety and overall protection are prioritized
areas” in Japan, with most organizations establishing stronger measures to ensure strict
compliance. These responses supplement the secondary and tertiary evidence analyzed above,
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Meti.go.jp “Overview of Japan’s product safety acts”
Meti.go.jp “Overview of Japan’s product safety acts”
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pointing out that manufacturers are liable for their product users’ safety breaches, especially in
instances of defective products.
Analysis of Product Liability Laws in China
China is one of the nations in the world that has experienced significant economic and
industrial growth over the last few decades. The advancement in the economy and
industrialization resulted in increased consumer demand and the need for robust consumer
protection measures. The country has established a comprehensive legal framework to regulate
product safety and ensure consumer rights. Consumer law in the nation encompasses the product
liability legislation defined under the constitution of the Communist People’s Republic of
China.6. Product liability laws in China aim to ensure product safety and protect consumers.
They’re framed within a complicated legal structure encompassing multiple laws, regulations,
and judicial interpretations7. Broadly, they can be categorized into General Laws and SectorSpecific Laws. General Laws include the Civil Code, Product Quality Law, and Consumer
Rights and Interests Protection Law. Sector-specific laws, on the other hand, regulate safety and
quality in areas such as food and pharmaceuticals.
Scope of Product Liability Laws in China
The Product Quality Law, a core legislation, enforces strict liability on producers for
defective products, regardless of the producer’s fault. However, producers can be exempted from
liability under certain conditions. Exemptions can occur if the product hasn’t been circulated, the
defect wasn’t present at the circulation8. An additional exemption may also be evident if the
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Thomas “Amending China’s notion of a “consumer.”
Thomas “Amending China’s notion of a “consumer.”
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NPC.gov.cn “Tort Liability Law of the People’s Republic of China”
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technology during product manufacture couldn’t detect the defect. In contrast, the law requires
evidence of intent or negligence for sellers to be held liable. They must bear compensation
liability if they can’t identify the defective product’s producer or supplier. The Tort Law also
allows claimants to seek remedies for product defects causing damage.9. Consumers can claim
compensation from either seller or producer if they suffer from defects, per Consumer Rights
Law. Manufacturers of consumer products that are non- complaint to China’s performance
standards are given a chance for product retests. Repeat non-compliance would imply that
remedial measures would be taken to ensure full compliance or face sanctions10. Manufacturers
or sellers dealing with counterfeit products are also held liable under Chinese criminal law,
where they may face sanctions, fines, or imprisonment.
Similarities in the Product Liability Laws of Both Countries
The legislation concerning product liability has evident similarities in both Japan and
China. The first evident similarity is that both countries have adopted a system of strict liability.
Strictness is evident by holding manufacturers accountable for defective products, irrespective of
fault or negligence. Both countries require manufacturers to be adherent to safety and quality
standards.11. Manufacturers from both countries are further obligated to prioritize consumer
protection. The second evident similarity between the two is the role of governments in product
liability. The implementation and regulation of product liability laws fall under the purview of
the administrations in both nations. The oversight entities are tasked with the responsibility of
overseeing the safety of products. Government entities in both nations further carry out audits
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NPC.gov.cn “Tort Liability Law of the People’s Republic of China”
Zhou et al. “Check-testing of manufacturer self reported labeling data & compliance”
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Hironaka and Ichiba “Chapter 8: Japan” 83-93
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and enforce sanctions for any violations of regulations. Both nations are considerate of the
protection of the consumer rights of their citizens.
Differences in the Product Liability Laws of Both Countries
There are evident differences in the product liability legislations of Japan and China.
While both countries have enacted legislation to address product liability, the specific
definitions, liability criteria, and available remedies may differ. These differences reflect
variations in legal traditions, cultural contexts, and approaches to consumer protection. One
significant difference lies in the legal frameworks and specific provisions of each country’s
product liability laws. Another difference lies in the enforcement mechanisms and resources
available for product safety regulation.12. The capacity and effectiveness of regulatory authorities
in monitoring and enforcing product liability laws may differ between Japan and China. It can
impact the speed and efficiency of addressing product defects and ensuring consumer safety.
The other evident difference is in the application and scope of the product liability laws.
In Japan, the liability is primarily on the manufacturers and other parties involved in the
production process. In contrast, China also extends this liability to sellers and provides
exemptions to producers under certain conditions. Unlike Japan, sellers in China can also bear
compensation liability if they can’t identify the defective product’s producer or supplier or be
negligent or intend to sell a defective product.13. Another crucial difference lies in the scope of
these laws. Japan’s laws exclude real estate, intangible products, and unprocessed natural
products; however, China’s laws do not specify such exclusions. Therefore, despite both nations
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Hironaka and Ichiba “Chapter 8: Japan” 83-93
Janssen and Wang “Punitive damages under the new Chinese Civil Code.”
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valuing the importance of product liability laws, their definition and application vary
significantly.
Conclusion
The comparative analysis between Japan’s and China’s product liability laws exhibits
shared objectives and distinct national characteristics. Each country upholds a strict liability
system, reflecting a shared commitment to consumer protection. There are evident disparities in
the definition, application, and enforcement of the product liability laws. These differences
illustrate how consumer protection, while a universally embraced concept, can take diverse
forms in various jurisdictions. Future research should focus on exploring specific challenges and
addressing gaps in the legal frameworks. The research should also identify best practices to
strengthen consumer protection in Japan and China.
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Works Cited
Hironaka, Akihiro. “Chapter 8: Japan.” The Product Regulation and Liability Review, edited by
Kazuyuki Ichiba, 7th ed., Law Business Research Ltd, London, United Kingdom, 2020,
pp. 83–93.
Janssen, André, and Jia Wang. “Punitive Damages under the New Chinese Civil Code – a
Critical and Comparative Analysis.” Asia Pacific Law Review, vol. 29, no. 2, 2021, pp.
346–365, https://doi.org/10.1080/10192557.2022.2033087.
Meti.go.jp. Overview of Japan’s Product Safety Acts – 経済産業省, 2021,
www.meti.go.jp/english/policy/economy/consumer/pdf/overview_japan.pdf.
Nottage, Luke. “Consumer Rights in Japan.” Japanese Consumer Dynamics, 2011, pp. 31–61,
https://doi.org/10.1057/9780230302228_3.
NPC.gov.cn. “Tort Liability Law of the People’s Republic of China.” Laws, 2009,
www.npc.gov.cn/zgrdw/englishnpc/Law/2011-02/16/content_1620761.htm.
Thomas, K. “Amending China’s Notion of a ‘Consumer’: Lessons from Comparative Analysis of
the PRC Consumer Protection Law.” Journal of Consumer Policy, vol. 45, no. 3, 2022,
pp. 435–456, https://doi.org/10.1007/s10603-022-09518-3.
Zhou, Nan, et al. “Check-Testing of Manufacturer Self Reported Labeling Data & Compliance
…” Check-Testing of Manufacturer Self Reported Labeling Data & Compliance with
MEPS, 2021, www.clasp.ngo/wp-content/uploads/2021/01/2008-09-CheckTestingOfManufacturerSelfRpoertedLabelingDataAndComplianceWithMEPS.pdf.
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Appendix
Interview Questions
1. As a business worker with experience with the Japanese corporate environment, what
specific measures did your previous workplace implement to ensure consumer
protection?
2. Describe specific regulations for consumer protection that the Japan-based businesses
must comply with? How did your former workplace navigate them?
3. During your stay in Japan, did you experience significant changes in the consumer
protection regulations? How did it impact the workplace and consumer rights?
4. What were some of the common concerns related to consumer protection among
consumers? How did the company address them?

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