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What is the standard product liability clause?

There is no one-size-fits-all “standard” product liability clause, as these clauses can vary widely based on factors such as the nature of the products, the parties involved, and applicable laws.

However, a typical product liability clause in a contract might include elements such as:

  1. Indemnification:

    • The manufacturer or supplier may agree to indemnify and hold harmless the buyer or distributor against product liability claims.

  2. Insurance Requirements:

    • The clause may stipulate that the manufacturer or supplier maintains adequate product liability insurance coverage.

  3. Compliance with Laws and Standards:

    • A provision requiring the manufacturer or supplier to comply with all relevant laws, regulations, and industry standards related to product safety.

  4. Notification of Defects:

    • The obligation for the manufacturer or supplier to promptly notify the buyer or distributor of any known defects, hazards, or recalls related to the products.

  5. Recall Procedures:

    • If applicable, the clause may outline procedures for initiating and coordinating product recalls in case of safety issues.

  6. Limitation of Liability:

    • The inclusion of limitations on the manufacturer’s or supplier’s liability, specifying the extent to which they will be responsible for damages in the event of a product liability claim.

  7. Allocation of Responsibilities:

    • Clarity on the respective responsibilities of each party in ensuring product safety, quality control, and compliance.

It’s crucial to tailor product liability clauses to the specific circumstances of the business relationship and seek legal advice to ensure that the terms align with the applicable laws and provide adequate protection for all parties involved. Legal professionals can help draft or review product liability clauses to address the unique risks associated with the products and industry involved. 

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