Product liability (Produkthaftung)

In practice

Product liability applies to the business regardless of fault, and no contract can exclude it as far as injured persons are concerned. The three-year limitation period begins when the injured person knows, or ought to know, of the damage, the defect and the identity of the party liable. Claims lapse ten years after the product was placed on the market. This period should be covered by insurance. Where there is fault, the producer’s liability in tort applies as well, with more extensive damages. Effective protection lies not in the contract but in how the business is organised: a documented risk assessment, clear instructions with warnings, traceability of batches, and a procedure for complaints and recalls. Within the supply chain, the risk can be shared through indemnities, recourse and insurance that fits the type of product. Anyone who puts their own trade mark on someone else’s goods is liable in the same way as the manufacturer. Product monitoring does not end on delivery. If reports of damage accumulate, the business must respond. Under the new Product Liability Directive, failing to provide a security update can also be a defect. The new EU Product Liability Directive expressly covers software as a product. It also eases the burden of proof for injured persons. The German implementing act is expected to enter into force on 9 December 2026.