Interesting Topic Interesting view of EU Authorised Representative under MDR

Ronen E

Problem Solver
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An interesting interpretation of the AR provisions in the MDR, from BSI's blog:
If you are a non-European manufacturer with medical devices on the European market, you will have already an authorized representative (AR) in the European Union (EU). The moment you claim compliance with the new European regulation on medical devices (2017/745 - MDR), your existing AR may become instantly obsolete. It would then be illegal to place your devices on the EU market.

Under the current system (MDD 93/42/EEC) anybody can be an authorized representative and often all that is required of the AR in practice is to be able to pass a message from a Competent Authority to the manufacturer. For many manufacturers, the AR is not a significant factor in the compliance paradigm.

Let’s suppose that you are using an external authorised representative, i.e. not somebody within your organisation.

Dealing with the new AR is like moving to another universe where the laws of physics are different. The new AR must have at their disposal a person responsible for regulatory compliance with appropriate qualifications attesting regulatory expertise. The AR must verify the manufacturer’s regulatory compliance and terminate the relationship if it finds the manufacturer to be in non-compliance. The AR will be highly motivated to terminate the relationship in such situations as it will become liable for the manufacturer’s defective products. The loss of an AR will immediately bar the manufacturer from placing the medical devices represented by the AR on the EU market. In addition it is likely to trigger an investigation of the manufacturer as the termination must be notified to the AR’s Competent Authority. The Notified Body may have to recognise that the manufacturer is in non-compliance and declare a major non-conformity. In the worst case, it may have to provisionally withdraw the manufacturer’s certification until the non-compliance has been corrected. Since importers and distributors cannot make non-conforming devices available, this cascade of events may have an adverse effect on the supply chain to the market. It is unlikely that the manufacturer will be able to find a new AR quickly as the transfer must be based on an agreement with the ex-AR and a formal process that will allow the prospective new AR to quickly become aware of the alleged problems of the manufacturer.

With proper preparation, the situation does not have to be this bleak.

The manufacturer and the AR must mutually agree to a mandate that determines the tasks that the AR will be responsible for. There are certain responsibilities that the manufacturer cannot delegate and certain tasks that the AR must undertake. Because of the high probability of an acrimonious conflict between the two, the negotiation on the mandate should cover also arrangements for conflict resolution that avoids the commercial Armageddon made possible by the MDR. The AR would probably feel much less inclined to terminate the manufacturer too easily if the agreement included provisions that would extend the manufacturer’s product liability insurance to cover the AR.

The above scenario relates to external ARs that are not part of the manufacturer’s organisation. Imagine the above situation when the AR is within the manufacturer’s own organisation! It is almost unimaginable that an employee who acts as the authorised representative for his own employer would pull the plug in this manner. The law nevertheless suggests that this could happen. So how would the internal authorised representative resolve the situation? But that is another story…

Author: Mika Reinikainen, LL.M., MBA, Managing Director at Abnovo Ltd.
Authorised representative concerns - Deadline 2020

Marcelo Antunes

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Staff member
Not sure exactly what's new here. I in particular have been saying more or less the same thing for manufacturers in Brazil for some years now, as the new "cross check" requirements of the MDR (as I call backstabbing (Vetores de Aperto De Mão E Armas Parceria De Negócios Com A Rivalidade E Desconfiança Ilustração Em Vetor Conceito Empresarial e mais imagens de Stabbed in the Back - iStock) /we are not friends anymore situation :p) were put in place to prevent problems, but on the other hand will make certain arrangements much more difficult. The AR is in fact only one of those arrangements (several of my clients have already have a lot of trouble related to MDR implementation and importers/distributors). Also, some ARs have already been getting out of the market due to this situation (in particular the liability clause). It's easier when you are not accountable :p

On the other hand, a lot of people still do not see to understand the scope and grounds of these changes, and the effects. For example, in one of my last MDR trainings, I was discussing the need to revise all contracts with all the economic operators, in particular in regards to the new responsibilities and the verification requirements that the importer and distributor have to perform (including the importer "mark"of conformity") and one attendee said that she saw no problems because THEIR NOTIFIED BODY said that they should not worry about that, that the competent authorities would evaluate the importer and distributors and that anything that the importer or distributor did wrong, they would be punished (and I won't even start mentioning how the NB should not say stupid things that are outside their jurisdiction and, it seems, their knowledge :p). When I mentioned that the CAs do not perform this kind of evaluation, and that, in the event of a NC product reaching the market it would be THEIR product, and even if the importer/distributor did something wrong, the CAs would target THEIR product, the attendee seemed to begin to grasp the reality.
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The requirement for foreign businesses to have a local authorized representative is not limited to the EU nor to medical devices. It is a near-universal practice in international business.

Governments typically want foreign companies to have a local authorized representative that is physically located and incorporated within their jurisdictions, because those entities are unambiguously subject to local laws. This means they have an entity they can prosecute under their their own laws rather than having to struggle with international law.

Like many things in the MDR, it's nothing new, just spelled out in more detail. There is legal liability attached to serving as the authorized representative of a foreign company.

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