Product liability in Hong Kong

June 2025 | SPOTLIGHT | RISK MANAGEMENT

Financier Worldwide Magazine

June 2025 Issue

Similar to other jurisdictions, a manufacturer or supplier’s liability for manufacturing or supplying defective or non-compliant products in Hong Kong can arise under civil as well as criminal law. Whether products are defective or non-compliant is determined by reference to both case law and statute. In this article, we briefly explain how the manufacturing, supply or sale of defective non-compliant products in Hong Kong is regulated.

To begin with, Hong Kong has a fairly complex framework of legislation and subsidiary legislation dealing with how certain types of products are to be manufactured and sold. The general safety requirements applicable to consumer goods is covered in the Consumer Goods Safety Ordinance (Cap 456) (note the exclusion of certain items from the definition of consumer goods under the schedule to this ordinance), namely that the goods are reasonably safe, having regard to all the circumstances. For toys and children’s products generally, the Toys and Children’s Products Safety Ordinance (Cap 424) (in particular schedules 1 and 2) sets out the requisite safety standards. For more specific types of products, examples of legislation include: (i) the Electrical Products (Safety) Regulations (Cap 406G), which prescribes how household electrical products are to be manufactured; (ii) the Public Health and Municipal Services Ordinance (Cap 132) together with its subsidiary legislation, and the Food Safety Ordinance (Cap 612), which regulates the production and supply of food; and (iii) the Dangerous Goods Ordinance (Cap 295), which regulates the production and supply of dangerous goods, such as explosives. It would be impossible to exhaustively list all relevant legislation. Often, breaches of such legislation give rise to criminal consequences, such as a fine or imprisonment (if the offender is a natural person). The breach may be prosecuted in the criminal courts of Hong Kong.

It is not uncommon for the relevant government department (such as the Electrical and Mechanical Services, Food and Environment Hygiene and Customs and Health Departments and the Department of Health) to order a recall of the offending product, in addition to investigating and prosecuting any infringement of the relevant legislation, to avoid or minimise injury to the public.

While strictly speaking not an enforcement authority, the Consumer Council regularly publicises information on product safety. It also conducts market surveys and testing, comparing products of different brands, and as part of that process, assesses the quality of the products. The Consumer Council does not have any statutory power to impose punishment or to litigate product liability issues. That said, it manages the Consumer Legal Action Fund, which provides financial support to consumers to advance consumer claims affecting consumer interests. It can, and has in the past, publicly named products and urged manufacturers to make improvements it considers necessary in the interests of the consumers.

Liability under legislation for defective or non-compliant products is typically strict, meaning that the product in question does not necessarily need to be unsafe in the conventional sense or to have actually caused harm to users. So long as it does not conform to the requirements set out in the relevant legislation, a product may be defective or non-compliant and become at risk of enforcement by the relevant authority.

As a matter of civil law, a manufacturer, supplier or seller may also be held liable under the tort of negligence or contract. The tort of negligence holds liable a manufacturer that has failed to observe a duty of care owed to the end user. There must, therefore: (i) be a duty owed to the end user; (ii) a breach of that duty; (iii) a loss caused by the breach; and (iv) the loss to be reasonably foreseeable.

For the sale and supply of products, a supplier or seller may be liable for failing to observe the relevant contractual duty found in the relevant contract for the supply or sale of goods. The relevant duty or obligation may be imposed by an express term (i.e., a term chosen to be included by the parties, for example to deliver goods by a certain date), or an implied term (i.e., a term that is ‘read into’ the contract by common law or by statute, such as the Sale of Goods Ordinance (Cap 26)). In particular, the Sale of Goods Ordinance (Cap 26) implies certain conditions or undertakings, such as that the goods must be of merchantable quality, conform to description or sample (if applicable), and be fit for the particular purpose they are sold. Any provisions in contracts excluding contractual liability are subject to control by the Control of Exemption Clauses Ordinance (Cap 71), which limits the effectiveness of such clauses by reference to a test of reasonableness and disapplies any exemption clauses purporting to exclude liability for death or personal injury and the implied conditions imposed under the Sale of Goods Ordinance insofar as dealings with a consumer are concerned.

If a claimant wishes to start a civil claim, there are different levels of courts in Hong Kong that process different claims according to, generally, the quantum of the claim. For claims with quantum above HK$3m the claimants will commence the claim in the High Court. For claims with quantum above HK$75,000 but no more than HK$3m the claim will be commenced in the District Court. For claims that are HK$75,000 or less, the claim will be commenced in the Small Claims Tribunal, which is a court where no legal representation is allowed.

The consequence of being held liable for negligence or breach of contract is civil in nature, i.e., the manufacturer may be liable for damages such as financial loss. The quantum of damages that can be recovered will depend on the individual case and is fact sensitive. The amount will be affected by: (i) the causal link between the act of the manufacturer, supplier or seller and the actual loss and damage suffered by the claimants; and (ii) the remoteness of the loss, such as whether the loss and damage suffered by the claimants is not too remote and is reasonably foreseeable.

To claim against a manufacturer under the tort of negligence or supplier or seller for breach of contract, the aggrieved person must commence an action in the courts of Hong Kong. There is no specialist tribunal which deals with product liability issues, whether civil or criminal.

Product issues are not as commonly litigated in Hong Kong as in other jurisdictions. This might be due to the strict and ancient rule against maintenance and champerty, rendering the funding of litigation by a third party generally illegal and thus making it difficult for an individual to secure the financial resources to pursue manufacturers, suppliers or sellers, which generally have deeper pockets. Further, there is generally no class action mechanism in Hong Kong, meaning that aggrieved individuals cannot join forces and pursue a manufacturer, supplier or seller for the supply of one single product. Apart from the expectancy of damages, and a wish to ventilate their grievance, there may be little incentive for aggrieved individuals to litigate the matter.

Given that Hong Kong has an adversarial system (except for the Small Claims Tribunal) it is up to the parties to adduce evidence to prove their case (in criminal proceedings the prosecution bears the burden of proof, which is beyond reasonable doubt). Product liability cases often involve technical and medical issues, such as product specifications, industry practices, safety standards and compliance issues, personal injury, and related property damage, and, as such, expert evidence is of critical importance. This adds to the burden of litigants as they will have to factor in additional costs for engaging an expert to address and explain technical and medical issues. With the exception of the availability of the Consumer Legal Action Fund managed by the Consumer Council, there is no central fund or scheme established by, for example, the government, to compensate aggrieved individuals (even if the matter is sufficiently serious to warrant litigation), so individuals have to pay for (often expensive) legal costs out of their own pocket, which gives rise to an additional barrier.

Another important issue in product liability is the issue of limitation. Generally, the limitation period applicable for contractual claims is six years, while claims in tort involving personal injury is three years.

Paul Kwan is a partner, Mandy Pang is a senior associate and Titus Cheung is an associate at Deacons. Mr Kwan can be contacted on +852 2826 5354 or by email: paul.kwan@deacons.com. Ms Pang can be contacted on +852 2825 9536 or by email: mandy.pang@deacons.com. Mr Cheung can be contacted on +852 2825 9710 or by email: titus.cheung@deacons.com.

Paul Kwan, Mandy Pang and Titus Cheung

Deacons