Legal challenges facing manufacturers of electric vehicles in Europe

By Lawrence Freeman


3.1 million new electric vehicles ("EVs") were registered worldwide in 2017. This represents an increase of 57% from 2016 and is similar to the growth rate of 60% in 2015 and 2016. Currently, China accounts for around 40% of the global EV fleet while the European Union and the United States each have around 25% of the worldwide total. In particular, Norway is leading the way in introducing EVs with EVs representing a share of 6.4% of vehicles in its stock.1

These developments are being driven primarily by a general awareness of the environmental benefits of EVs over internal combustion engine ("ICE") vehicles. EVs emit no tailpipe CO2 and other pollutants such as NOx, NMHC and PM at the point of use and EVs create less noise pollution than ICE vehicles. Government incentives to increase the percentage of EVs on the road have also emerged.

This shift towards electro-mobility requires innovation and cooperation between market players who need to shape this transformation in a successful and legally-sound way.

The following are examples of legal challenges which EV manufacturers may face in Europe:
  • Batteries: Rules for market authorisations (including registration and labelling), take-back and proper handling, and second-life usage;
  • Vetting accuracy of customer–facing materials (in particular in relation to battery degradation, range, horse-power and acceleration);
  • Commercial and statutory warranties;
  • Motor Vehicle Purchase Agreements, distance-selling rules and cancellation provisions;
  • Rollout of a network of charging points and alternative fuels infrastructure legislation;
  • Emissions credit trading;
  • Right-to-Repair rules;
  • Data protection rules;
  • Intellectual property;
  • Electromagnetic compatibility legislation;
  • Energy labelling;
  • Applying for relevant subsidies and ensuring their appropriate use to avoid potential exposure to recovery claims by the funding authorities;
  • Handling investigations by market surveillance authorities following EV accidents (especially those involving EV fires);
  • Registration, Evaluation, Authorisation and Restriction of Chemicals ("REACH");
  • End-of-life vehicles legislation;
  • Tires legislation;
  • CE marking and declarations of conformity;
  • Restriction of use of Hazardous Substances ("RoHS");
  • Waste Electrical and Electronic Equipment ("WEEE");
  • ISO standards;
  • Applying type approval requirements and UNECE Transport Regulations to EVs;
  • The regulatory framework for autonomous vehicles;
  • Concluding contracts such as partnership agreements, joint venture agreements, commercial agreements (e.g. in the context of supply chains), and non-disclosure agreements;
  • Handling conformity of production and recall audits, corrective action processes and product recalls;
  • Reviewing the application of EU anti-trust laws to selective distribution agreements and to the supply of spare parts for EVs;
  • EU Trade laws;
  • Applying legal rules to EV buy-backs and returns;
  • Ensuring online EV sales practices comply with Geo-blocking legislation;
  • Contingency planning for different Brexit scenarios;
  • Reviewing the application of net neutrality rules to zero-rated mobile services in EVs.

Should you have questions or wish to discuss any of the legal aspects relating to electric vehicles, we would be delighted to speak with you.

1 Source: OECD/IEA Global EV Outlook 2018