What can happen if I import and sell non-compliant products?

Product testing and certification may seem overly expensive and bothersome for some importers. That said, selling unsafe and non-compliant products is not only a severe risk for the consumers in your target market, but also something that can massively backfire on your own business.

Keep reading, and learn what can happen if you fail to ensure compliance with all relevant safety standards, certification requirements, and labeling rules.

This is covered:

1. Your shipment can be rejected by the customs authorities

2. Your products may be subject to a forced recall

3. You may be fined

4. You’re liable if anyone is injured (or if property is damaged)

5. Amazon.com may reject your product

6. Your product may not even leave the factory

1. Your shipment can be rejected by the customs authorities

Customs authorities around the world don’t have the resources to check if every single shipment of the product is compliant. But, they do check some shipments and have the right to reject incoming shipments in the following grounds:

• Incorrectly labeled
• Lacking mandatory product compliance documents (e.g. Declaration of Conformity)
• Lacking test reports

Further, some customs authorities also have testing equipment. For example, US customs can check if your product contains certain restricted substances upon arrival. I can’t say how common this is, but it does send the signal that they take product safety seriously.

This is not only a risk in the United States though. I’m aware of a few cases in which the German customs authorities seized incoming product sample parcels due to missing CE marks.

2. Your products may be subject to a forced recall

Product compliance is not only about ‘getting past’ the customs check, assuming there even is one. Market surveillance authorities, such as the U.S. Consumer Product Safety Commission (CPSC) - not to forget their counterparts in the European Union -, can contact you weeks, months or even years after the products were imported and sold.

Forced recalls are issued when products are deemed to be non-compliant and unsafe, which essentially means that you need to organize the return of all unsafe products - and offer refunds or replacements.

Here are a few scenarios when your product may be subject to recall:

a. Your products are reported to the relevant authorities as non-compliant and/or generally unsafe

b. Your product is subject to testing by market surveillance authorities (in some countries they buy products from various online stores and send them for safety testing)

3. Market surveillance authorities may contact you at any time to request all mandatory product compliance documents (e.g. test reports, product certificates and declaration of conformity). Failing to provide the required documents can result in a forced recall.

4. Your products are incorrectly labeled (e.g. lacking a CPSIA tracking label, country of origin label or CE mark).

3. You may be fined

A few years ago I dealt with a case involving a company caught selling non-compliant LED lighting. As they failed to provide the necessary Declaration of Conformity, they were fined 5000 EUR.

It’s worth mentioning that they did actually have valid test reports, which certified that the products they sold were in fact safe. That said, test reports are often not enough.

In this case, and many others, what seemed to be a minor formality (e.g. to issue a Declaration of Conformity) cost them dearly.

4. You’re liable if anyone is injured (or if property is damaged)

What’s possibly worse than fines and a forced recall? Well, imagine if your product cause fire, injury or even death. That’s, unfortunately, something that happens everyday. Keep in mind that you, as an importer, is liable in case something happens.

Further, product liability insurance may not cover you if you have not followed the requirements set by applicable product regulations.

It’s in everyone’s interest that products sold on the marketplace are tested, compliant and safe. Importers act as gatekeepers and must take this role seriously.

It should also be mentioned that this responsibility cannot be shifted to foreign suppliers. It’s easy to think that “the supplier should know best”, but that’s rarely the case.

5. Amazon.com may reject your product

Amazon is getting increasingly strict when it comes to product compliance. Submitting test reports and compliance documents is required when selling toys, children’s products, power banks, and other items on Amazon.

Failing to submit mandatory test reports and certificates (e.g. Children’s Product Certificates) is likely to result in your product being suspended.

Amazon is likely to become even more strict in the future as they are facing pressure to ensure that all products sold on their marketplace are compliant and safe.

6. Your product may not even leave the factory

The EU recently included freight forwarders, fulfillment centers, and other economic operators in the supply chain to its definition of responsible parties. In a not too distant future, shipping companies and other logistics companies may refuse to handle your products unless you can provide all required test reports and other compliance documents.

This makes sense, as companies are generally more efficient than the government when it comes to ‘policing’ the supply chain.

Conclusion

Far too often I see importers trying to figure out how they can go around product regulations, rather than doing their utmost to ensure that their products are safe, lab tested and correctly labeled. We must all do our parts, including importers.

Testing and certification may at first seem expensive and bothersome. To some extent, that’s also the case. However, on the bright side, it also helps to keep future competitors out.