CHINESE COMPANIES CONTINUE TO FACE TRADE DIFFICULTIES

From Easy-Bake Ovens to pet food, US consumers are following through with their objections to unsafe products, and legal practitioners say that Chinese companies will have to bear some of the costs. Class actions have been filed against Mattel and Fisher-Price, and costs for lead-poisoning tests and punitive damages awarded by US courts may also filter back to producers.

According to Simon Luk of international law firm Heller Ehrman, Chinese manufacturers are now facing the consequences of a lack of prior planning to ensure their products have been rigorously tested according to US standards. With claims that purchased products are not meeting safety requirements now starting to come in from US companies, Chinese manufacturers which have sold below-standard products are experiencing difficulties in fending off liability. ¡°Unfortunately, you don't have much of a choice when you sell to the US,¡± he says. ¡°If you sell to the US, you will be sued.¡±

While questions of which standards to use are typically associated with contractual obligations, strict liability spans the borders much more easily, as tort claims in the US can be easily enforced against the assets of manufacturers, wherever they are located. US accounts held by Chinese companies can be directly charged by way of court order, while indemnity claims by toy retailers can entail additional costs.