Globalisation has many benefits. For example, it can create new opportunities for the expansion of trade and ease freedom of movement for goods, services and people.
However, it can also bring threats. For example, increased competition or the transfer of businesses to lower wage economies. Sometimes there is unfair trading if companies fail to comply with standards and regulations, whether national, European or global.
To ensure a level playing field, governments throughout the world are recognising the need to regulate while allowing markets to develop and grow for the benefit of all.
Globalisation has shown the need to rapidly introduce measures to ensure there is an element of fairness so that we all know what is required when we trade around the world.
As a result, there is in today’s markets a growing level of regulation and standardisation to ensure:
- Product safety. For consumers and professional users.
- Product performance. Products deliver what they say they will.
- Energy efficiency. To help reduce carbon emissions and at the same time reduce energy costs for users.
- Sustainability and resource optimisation. Reduced use of finite resources or hazardous substances.
The latter two points are driven by environmental concerns and the first two by the need to ensure that users can enjoy the products they purchase.
Governments may drive the legislation, but it is industry that generally ensures that products and services meet the requirements of the legislation and standardisation. Quite often industry has to police the requirements as well, through its various trade bodies and other organisations.
Manufacturers and suppliers invest large sums in research and development, manufacturing controls, provision of technical information and the training of staff and clients to ensure fully compliant products are delivered to the market. Inevitably this means that compliant products are more expensive to make than non-compliant ones.
Increasingly governments, including the administration in the UK, accept that as they introduce legislation and regulatory requirements for the performance of products, they also need to enforce the regulations to ensure:
Users, both domestic and professional, enjoy the benefits of the products that they are buying.
The government policies of reducing energy use and demand for finite resources and hazardous substances are delivered.
As a result, the UK Government recently strengthened its enforcement plans (often referred to as market surveillance) in two ways:
- It centralised product testing. Products purchased randomly from retailers and distributors are monitored to see if they perform to the requirements of, for example, the energy label. The enforcement agency will also investigate market feedback – or whistle-blowing.
- The introduction of civil sanctions to complement criminal prosecutions. This will enable the enforcement organisations to respond more quickly and appropriately to non-compliance because there is a wider range of options than before: from requesting the withdrawal of products or other corrective actions to heavy fines.
All parties in the lighting supply chain should welcome this focus on compliance because it helps to ensure a level playing field for everybody.
In difficult market conditions we all appreciate that the costs of products and thus projects are important, but if non-compliant products are used to win orders it creates unfair competition but just as importantly it can also lead to:
- unhappy customers or clients because they don’t get the product and lighting performance they expected;
- increased costs because over the product life cycle the cost to the client will often be higher even though the product was initially cheaper to buy;
- environmental damage, for example, the UK Government may fail to achieve the environmental improvement policies it is implementing; and
- prosecution in the more serious cases.
We should as an industry get behind our trade associations and promote the importance of full compliance with regulations and standards and fully support the strengthening of enforcement of those by the government agencies.
We should also encourage the market to continue to be self-enforcing by not specifying, buying or promoting non- compliant products or solutions.
Ultimately decisions driven by cost rather than full compliance may lead to the problems described above, which cannot be in the best interests of the lighting industry as whole or its customer base.