CPSIA Warns the Resale Market

New restrictions from the CPSC passed last year with the Consumer Product Safety Improvement Act have caused confusion and controversy in the children’s industry. While many agree and gladly comply with stricter lead and testing requirements, the broad language in the legislation could put small operations in a tight spot.

Recently CPSIA has turned its attention to resellers in the children’s industry including consignment stores and garage sales.

While resellers, charities, and non-profits are not required to test their products for adherence to safety standards, they are held accountable to the same guidelines as all other retailers and manufacturers. Fines for selling recalled or noncompliance products have been increased and can be as high as $100,000 per infraction. Events that involve a series of infractions could carry fines as high as $15 million.

The CPSC states that the increased fines are aimed at the giants in the industry, such as Fisher-Price who have been able to simply pay the fines in the past. No part of the bill restricts the fines for small businesses or garage sale-holders below that limit.

CPSC Guide Outlines Reseller’s Restrictions

The CPSC has released a 24-page guide for all resellers, cosigners, and thrift shops that sell children’s products. The guide outlines the restrictions that must be followed; however, the language remains broad and unspecific. Fines are not clearly established, though the guide points out that all penalties will consider the size of the business and those with limited financial means. According to the guide, all fines will also consider the risks associated with the infraction, how many products were involved, and the nature of the defect.

As the implications of the new legislation are better known, those within the industry will continue to make adjustments to their inventory and operations to comply. While the guidelines have been applied to all products sold, under any circumstances, questions remain about the extent the CPSC will go to as an enforcer, especially as it relates to small businesses and individuals.

For more information about the legislation visit www.CPSC.gov. The booklet for resellers, thrift shops, and garage sales can be found at http://www.cpsc.gov/cpscpub/pubs/thrift/thrguid.pdf.