“Compliance” has become a buzzword for companies across the American economy, most commonly in the general corporate (e.g., Sarbanes-Oxley) or employment (e.g., Department of Labor) contexts.  Unfortunately, too many consumer product companies do not have a written plan for meeting their hazard and incident reporting requirements to the Consumer Product Safety Commission (CPSC).

Multiple companies this year have been hit with penalties — some of them in the millions of dollars —for failing to report troublesome incidents and for making safety-related design changes without notifying CPSC.

CPSC rules require that the agency be notified about possible product defects that may constitute a substantial product hazard.  Those rules also require certain lawsuit settlements / verdicts and product design changes to be reported.  With the increasing number of seven-figure fines, the agency is making it clear that CPSC Reporting Compliance needs to be taken every bit as seriously as other regulatory obligations.  Reporting violations are usually the result of bad processes, not bad companies.  Setting up good compliance programs and avoiding CPSC fines requires proactive counsel and managment.

Recently, Bloomberg BNA published Ten Tips for companies on how to set up good compliance programs and avoid CPSC fines, which can be found here.