Liability Rules for the Digital Age

TLDR

The European Commission proposes two directives to adapt liability law to digitalisation. The aim is to modernise the existing liability system to meet the challenges of digitalisation. The proposal expands the product concept to include intangible digital goods and holds e‑commerce intermediaries liable. The new product liability directive is a significant advance that could become a global benchmark.

Abstract

Abstract With legislative proposals for two directives published in September 2022, the European Commission aims to adapt the existing liability system to the challenges posed by digitalisation. One of the proposals is related and limited to liability for artificial intelligent (AI) systems, but the other contains nothing less than a full revision of the 1985 Product Liability Directive, which lies at the heart of European tort law. Whereas the current Product Liability Directive largely followed the model of US law, the revised version breaks new ground. It does not limit itself to the expansion of the concept of product to include intangible digital goods, such as software and data as well as related services, important enough in itself, but also targets the new intermediaries of e-commerce as liable parties. As such, the proposal for a new product liability directive is a great leap forward and has the potential to grow into a worldwide benchmark in the field. In comparison, the proposal of a directive on AI liability is much harder to assess. It remains questionable whether a second directive is actually needed at this stage of the technological development.