Why do I need an Authorised Representative when placing my product on the European (and/or UK) market? And why should I especially consider appointing one from July 16th 2021? What impact will the new product market surveillance legislation have on me?
As in the European Union Regulation 2019/1020/EU comes into force, a lot will change concerning product market surveillances, its authorities and effects for Economic operators.
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The industry and its economic operators (e.g. manufacturer, Authorised Representative) place yearly multi-millions of products on the European Market. By placing these products on the European market, the appropriate economic operator must declare conformity to the applicable directive or regulation, cooperate during market surveillance etc. There is a big difference between declaring compliance and being compliant, which we may conclude from performed market surveillances. A market surveillance study over the year 2020, has shown that over 60% of the inspected products did not meet the formal requirements although the Economic Operator declared compliance.
An example of non-compliances: Integrating Pre-approved radio IoT modules, does not mean product compliance for the end product. You always must perform scrutiny concerning if it is a must performing testing and/or certification. More about this in our blog “What are the requirements for RF module integration“. Additional, globally there are many different compliance regulations. As costs for compliance can exceed your expectations easily, we strongly advise you to not skip this part when writing your business plan. A detailed investigation of compliance costs is essential for the success of your product. More information to be found in the blog “Become a successful startup in IoT“.
More critical is the conclusion of the market surveillance authority concerning E-commerce inspection. 96% of the suspicious shipments (out of 8,832) did not get clearance for the European market.
Due to the number of products not meeting the requirements, the enforcement of the Regulation 2019/1020/EU will most certainly result in an increasing amount of market surveillances.
Economic Operators means the manufacturer, the Authorised Representative, the importer and the distributor or Fulfillment service providers. Each has its specific tasks and responsibilities when placing a product on the market. Placing on the market means the first making available of radio equipment on the Union market.
We categorize following Economic Operators:
Due to the increased E-commerce business, as from July 16th. 2021, by enforcing the regulation, a new Economic Operator will be introduced:
Once having placed the products into the markets by the Economic Operator, its network makes the distribution possible throughout the European Union. If appointing an Authorised Representative is mandatory or not, or its tasks can be fulfilled by one of the other Economic Operators is specified in the directive or regulation.
An Authorised Representative is a legal party based in the European Union that acts as a liaison between a manufacturer outside of the EU and competent national authorities within the EU. The authorised representative acts within the EU on behalf of the manufacturer and ensures that the products being sold on the EU market comply with the European Directives.
Examples of the tasks of the Authorised Representative:
Needing an Authorised representative can be optional, depending on the applicable directive or regulation and where the manufacture is located, whereby its tasks can be fulfilled by authorising another Economic operator. However, some European directives and regulations specify clearly, that appointing one is mandatory and should be a separate entity.
Optional (however the task can be fulfilled by other Economic Operator). | Mandatory and specifically a separate entity. |
RED 2014/53/EU | MDD 93/42/EEC |
EMC 2014/53/EU | MDR 2017/745 |
LVD 2014/35/EU | ATEX 2014/34/EU |
As a wider diversity of products do have a radio and wireless technology integrated, it is obvious that appointing an Authorised Representative is getting more a “must” than free to choose when you should only need to comply with the directive 2014/53/EU. An example is the Internet of Medical Things (IoMT), whereby devices need to comply with a multi of regulations. IoMT products need to comply with the MDR 2017/745 as well as the RED 2014/53/EU, whereby the MDR (replacement of the MDD) requires the designation of an Authorised Representative within the Union should the manufacturer be placed outside of it.
One of the differences in obligations between an Authorised Representative and importer is the availability of the Technical Construction File. The Authorised Representative shall keep the Technical Construction File at the disposal of the market surveillance authorities. An Importer shall ensure that the Technical Construction file can be made available. An example of making it available is upon request of the market surveillance authority.
E-commerce has increased the number of importers in the European Union. All the importers have responsibilities concerning regulatory compliance, should the market surveillance authority request information. It is an unwelcome surprise for the non-European manufacturer that for example a Technical Construction File should be provided to each separate importer in the community.
The Technical Construction File contains all the technical secrets where non-disclosure is essential unless really required. Request from Market surveillance authorities is an example. Due to the increased amount of Economic Operators and market surveillances, it is advised to appoint one dedicated Authorised Representative in the entire Union (and when possible approved for the UK) who keeps your Technical Construction File and Declaration of conformity as required and is always available to immediately react to market surveillance authorities requests.
An Authorized Representative must remain neutral in all actions, including being neutral towards possible competitive distributors or Importers. This is a reason for choosing a dedicated Authorised Representative. Your Technical Construction File contains sensitive information. Prevent unauthorised spreading and designate your specific Authorised Representative.
Amazon, Alibaba, AliExpress.com etc.. These are some of the E-commerce webshops, whereby many products enter the market also through the so-called fulfilment service providers.
The authorities have the right to seize and destroy incoming shipments without an EU Authorised Representative address. As such, it might be naive to expect a complete halt to non-compliant products entering the EU from July 16th. 2021. Still, this will hurt sellers that continue to sell non-compliant products in the following ways:
“If you sell CE-marked products that are manufactured outside of the EU, you will need to ensure that such products have a Responsible Person in the EU prior to July 16, 2021. After July 16, 2021, it will be illegal to sell CE-marked products in the EU without an EU Responsible Person. All CE marked products are covered by this rule except for medical devices, explosives for civil uses, and certain lifts and cableway installations.“
What is a market surveillance authority? This is an authority designated by a Member State as responsible for carrying out market surveillance in that territory.
As of July 16th. 2021 the mandate of the Market surveillance authorities will change in a significant way. Where it had a controlling function before, now Market surveillance authorities shall conduct their activities in order to ensure:
The Member States shall confer on their market surveillance authorities the powers of market surveillance, investigation and enforcement. When conferring powers, Member States may provide for the power to be exercisable the following ways, as appropriate:
As Authorised Representative reacting immediately to non-compliances found by authority will prevent you from the worst.
The powers conferred on market surveillance authorities include at least the following:
Member States may authorise their market surveillance authorities to reclaim from the relevant economic operator the totality of the costs. These are the costs of their activities with respect to instances of non-compliance.
These are costs next to cooperating on the corrective actions, or maybe even market ban.
We can conclude that the powers of the Market surveillance authorities will considerably be changed by the date of regulation 2019/1020 getting into force. Putting your non-compliant product on the market now means that immediate actions can be taken. Immediately responding to the market surveillance authorities is essential. Market Surveillance Actions which can lead to:
IoT Consulting Partners works with several Authorised Representatives who are able to offer the exact service you are looking for. Avoid surprises as market bans and be prepared. It is just a little step to appoint a dedicated Authorised Representative who you can trust and do have the quality system in place to give you the best services.
Our mutual goal is clear!
Achieving the best design, functionality, and user experience, and obtaining the final IoT GoGlobal market access!
For more information contact us directly or have a look in our on-line shop for a price indication.
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