If cells were imported from China, and there was no distributor within the U.K/E.U. then technically the person who imports the cells become the first distributor within the E.U.
The general product safety regulations covers this area of safety law, however it would seem that the the regulations covers a product that has been placed on the market within the E.U. As the cells were not placed on the market then I believe that the insurance company should not have treated the purchaser as an importer and attached liability to the purchaser.
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