Legal & Regulatory > Malaysia > Product Liability

All legal aspects surrounding product liability in Malaysian Pharma. Prepared in association with Skrine, a leading law firm in Malaysia, this is an extract from The Pharma Legal Handbook: Malaysia, available to purchase here for USD 99.

1. What types of liability are recognized in your jurisdiction?

Violation of laws and regulations may result in civil liabilities, administrative penalties and criminal liabilities

Civil Liability

1. discontinuance of infringements;
2. restitution (restoration of original condition);
3. specific performance;
4. compensation for loss;
5. payment for breach of contract damages; and
6. compensation for the defective product.

Administrative Liability

1. warning;
2. fine;
3. forfeiture of illegal earnings, forfeiture of illegal property;
4. search and seizure warrant;
5. power to enter premises and take samples;
6. order to stop production and business;
7. closure orders (order to close premises, building or facility);
8. impose conditions on permits and licences;
9. suspension or withdrawal of permits, suspension or withdrawal of licences; and
10. other administrative punishments as stipulated by law or administrative regulations.

Criminal Liability

1. fines;
2. confiscation of property;
3. criminal detention;
4. fixed-term imprisonment;
5. life imprisonment; and
6. death penalty.

2. How do these types of liabilities apply to the manufacturers of medicines and devices?

The authorized officer under the TCMA 2016 may enforce his powers of investigation and impose a stop order requiring a practitioner to stop and cease practicing in a practice area or a closure order for any premises, building or facility. The authorised officer also possesses other administrative powers such as applying for a search and seizure warrant, power to enter premises and taking of samples.

Nevertheless, the primary penalty stated in the various Malaysian legislations for any defects in medical products and devices lie in criminal liability with the imposition of fines or fixed-term imprisonment. There are no provisions for a compensatory regime following any civil liabilities.

3. Does potential liability extend to the manufacturer only or could claims extend to corporate executives, employees, and representatives?

These liabilities extend to corporate executives, employees and representatives of a company. For example, a director or legal representative in breach of his fiduciary duty or breach of trust or duty may face civil, administrative and/or criminal liabilities.

4. How can a liability claim be brought?

Civil Claims

Civil liability claims can be brought up by the aggrieved party as plaintiff in a civil court, or through arbitration if there is an arbitration clause in the underlying transaction document.

Administrative Claims

These actions are usually brought by the relevant regulators (i.e. NPRA, MDA, TCM Council, etc.) against the party in breach of their statutory duties or licensing obligations. Additional penalties may be imposed such as fines and/ or revocation of licence.

Criminal Claims

Following a complaint brought by a consumer or the relevant regulator, if it is discovered that a director or employees or representatives of a company has committed a criminal offence, the public prosecutor will then follow up on the investigation and potentially institute prosecution proceedings against the Defendant in the criminal court.

5. What defences are available?

The defences available for any person in respect of a defect in a product are as such:

1. that the defect is attributable to compliance with any requirement imposed under any written law;
2. that he did not at any time supply the defective product to another person;
3. that the defect did not exist in the product at the relevant time;
4. that the state of scientific and technical knowledge at the relevant time was not such that a producer of products of the same description as the product in question may reasonably be expected to discover the defect if it had existed in his product while it was under his control; or
5. that the defect is in a subsequent product to which the defective product was added to and that the defect is wholly attributable to the design of that subsequent product or compliance by the producer of the product in question with instructions given by the producer of the subsequent product.