
Publication
ESG and internal investigations: New compliance challenges
As ESG concerns have come to the forefront in different jurisdictions, the scope of these inquiries is expanding in kind.
Netherlands | Publication | abril 2025
Managing a product recall is a challenging scenario for any company as product recalls often need to be conducted urgently and can have long-term consequences. Poorly managed recalls can have devastating effects in terms of losing customer loyalty and increased regulatory scrutiny.
Product safety remains a top priority for the European Union (“EU”), especially as new technologies and the rise of online sales continue to reshape the marketplace. In response to these developments, the EU Commission has overhauled its consumer product safety framework to enhance consumer protection and adapt to the evolving landscape. On 13 December 2024, the General Product Safety Regulation (“GPSR”) came into force, replacing the previous directive with a regulation that provides modernized and future-proof rules.1 One of the key improvements in the GPSR is the introduction of harmonized requirements for handling product recalls, ensuring a more consistent and efficient approach across the EU. This shift reflects the growing need for robust regulatory mechanisms to address the complexities introduced by digital platforms and technological advancements. In this blogpost, we outline the key recall obligations under the GPSR and share best practices for companies to consider during the initial stages of a product recall.
The GPSR lays down essential rules on the safety of consumer products that are placed on the EU market or are made available on the EU market.2 Before the GPSR, rules on product safety in the EU were regulated by the General Product Safety Directive (“GPSD”).3 The GPSD acted as a safety net for those products whose safety was not regulated in a specific EU legislation. The GPSR continues following the approach of the GPSD that only safe products may be placed or made available on the market.
The GPSR provides multiple factors to be taken into account to assess whether a product is safe, including its design, technical features, composition, interconnection with other products, labelling, appearance, and categories of consumers using the product.4 Products are presumed safe if they conform to the relevant EU standards, or, in the absence of any relevant EU standards, conform to the national health and safety requirements of the Member State in which it is made available on the market.5
As of 13 December 2024, the GPSR applies directly to new, used, repaired or reconditioned products which are available for distribution, consumption or use in the EU.6 In other words, products placed or made available on the EU market after this date must comply with the requirements of the GPSR, even if they are produced outside of the EU. However, the GPSR does not cover all products, as the following products are excluded from its scope:
For products excluded from the GPSR, other specific legislative arrangements apply. This means that before initiating a product recall, companies must first determine the applicable regulatory framework for the product in question. Different regulations impose different requirements, including on timing, reporting obligations, and the authorities that must be notified. Failing to correctly assess the relevant regulatory landscape at the outset may lead to inadvertent non-compliance, even if a company acts in good faith but follows the wrong set of rules.
Compared to its predecessor, the GPSD, the GPSR applies to a wider range of economic operators. It now covers:
By expanding the scope, the GPSR strengthens accountability across the entire supply chain, including digital and logistical intermediaries.
Under the GPSR, when an unsafe product is made available to consumers, companies are required to execute a product recall—meaning they must take measures to retrieve the unsafe product from consumers and prevent further harm.
It is important to differentiate between a product recall and a product withdrawal:
The GPSR strengthens recall obligations, introducing stricter requirements on traceability, consumer communication and reporting obligations to ensure a more effective and harmonized approach across the EU.
The GPSR is very clear: dangerous products placed on the EU market should be withdrawn or recalled. While the GPSR encourages all economic operators (i.e. a manufacturer, the authorised representative, the importer, the distributor, the fulfilment service provider or any other natural or legal person who is subject to obligations under the GPSR) to make customers aware of product recalls, only manufacturers, importers and distributors are required by the GPSR to actually carry out a product withdrawal or recall.
The expanded scope of the GPSR creates new compliance obligations but may also lead to tensions between different stakeholders in the supply chain. For example, distributors may adopt a more risk-averse approach, choosing to suspend sales or remove a product from the market based on customer complaints or safety concerns—even in cases where the manufacturer does not believe sufficient evidence exists to classify the product as unsafe.
A distributor or online marketplace provider may decide to stop selling a product based on a single consumer complaint or a safety alert from a third party, while the manufacturer—who has more detailed product knowledge—may resist a recall unless concrete proof of risk is established. Similarly, an importer might take a precautionary approach to avoid liability, creating friction with manufacturers that prioritize business continuity.
These conflicts can disrupt supply chains, create reputational risks, and lead to regulatory scrutiny. To manage these tensions, companies should establish clear internal processes, risk assessment protocols, and communication channels between all parties subject to the GPSR to ensure timely and coordinated decision-making.
The GPSR provides some detailed rules on product recalls. These new rules aim to ensure a more complete and widespread provision of information for consumers as well as an enhanced system of remedies available to consumers that have purchased products that are subsequently recalled.
Effectively managing a product recall is a high-stakes challenge that requires swift decision-making, cross-functional coordination and strict regulatory compliance. A poorly handled recall can have far-reaching consequences, including:
Successfully navigating a recall requires a structured, well-prepared response plan that aligns with regulatory obligations, minimizes business disruption and prioritizes consumer safety. Taking swift and well-coordinated actions in the initial stages of a product recall is critical to ensuring regulatory compliance, consumer safety and minimizing business disruption. Before defining the recall strategy and initiating operational recall activities (i.e., product collection and removal from the market), companies should take the following key steps:
1. Establish a detailed log of events
2. Gather comprehensive factual information
To determine the scope and impact of a recall, companies should request critical data from relevant departments. Below is an example of an information request list that could be used as a starting point:
Information Request | Purpose |
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Identify the nature and cause of the defect or risk. |
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Verify compliance with tracking and labeling requirements. |
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Understand affected batches, delivery timelines, and impacted regions. |
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Trace manufacturing processes and quality control history. |
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Prevent further distribution of affected products. |
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Identify responsible personnel and decision-makers. |
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Detect patterns of product-related issues. |
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Assess where potential failures occurred. |
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Identify any previous warnings or non-conformities. |
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Review legal obligations with suppliers, distributors and partners. |
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Determine recall coverage and notification requirements. |
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Ensure compliance with internal risk management protocols. |
3. Engage key advisors and experts
4. Conduct a Risk Assessment
Assess the severity, urgency and exposure of the recall based on the collected data:
5. Perform a legal and regulatory compliance assessment
6. Conduct a commercial and insurance assessment
7. Develop a recall action plan
Once factual, legal and risk assessments are complete, define a clear recall strategy that includes:
By following these structured steps as a minimum, companies can navigate recalls efficiently, protect consumers and mitigate business risks while ensuring compliance with the evolving regulatory landscape under the GPSR.
This content is provided for general informational purposes only and does not constitute legal or professional advice. Every product recall presents unique challenges and requires a tailored approach based on the specific circumstances, regulatory requirements, and risks involved. Companies should seek guidance from experienced professionals to ensure an effective recall strategy and compliance with applicable laws.
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