November 30, 2000:
Environment Committee submitted Position Paper on WEEE

1) The draft Directive covers not only large but also small household appliances such as shavers, telephone sets, game machines, etc. In view of the fact that the environmental burden of small household appliances is minimal and that the recycling experience is limited, it is likely that recycling cost becomes excessive in comparison with the benefit. This raises a serious concern. The initial scope should be limited to large equipment and subsequently after a certain amount of experience is obtained, addition of other products to the list should be considered based on the experience gained under the Directive.

2) Ink and toner cartridges are recycled in many cases by manufacturers and others so that their removal from the scope of the Directive will have little negative impact on the environment. In such case as cartridges are collected after use by the third parties other than original manufacturers and are sold after refilling ink or toner, it is not clear whether manufacturers or such parties have responsibility for recycling. And if refilled cartridges are sold with its original brand, we can not identify companies that refilled ink or toner. In the event that an attempt was made to regulate them within the framework of this Directive, it could end up not being able to identify the responsible entity. Consumables such as ink and toner cartridges, therefore, should be removed from the scope of the Directive.

2. Substance Ban
Ban on substances (lead, mercury, cadmium, hexavalent chromium, PBB, and PBDEs) should not be provided in this Directive, but should be dealt with in horizontal directives after the implementation of comprehensive risk assessment. The reasons are stated as follows:

(1) Substance ban should only be enforced when and if a risk assessment proves its need and in cases where appropriate and economically viable substitutes exist. Sufficient risk assessment, however, is not indicated in the Explanatory Memorandum. In other words, a substance is prohibited simply based on a conventional view that a potential risk is suspected. The Explanatory Memorandum lacks validity, as it does not provide an analysis of the impact of the use of electric and electronic equipment on people and environment. Nor does it attempt to verify the usability including safety and durability of substitutes and the potential risk for health and environment.

(2) The substances stated above are widely used in other products than electric and electronic equipment. It, therefore, is not reasonable to ban their use only in electrical and electronic equipment.

(3) Compliance with the substance ban also requires efforts at components level. It, therefore, means that industry-wide efforts including SMEs manufacturing components become necessary. The components used in electrical and electronic equipment are also used in other products so that the substance ban that applies only to electrical and electronic equipment will result in unnecessary confusion and cost increase in the industry as a whole.

(4) The substance ban will prevent the importer of the relevant substances and the equipment using the relevant substances from marketing them in the EU region, thus erecting a new trade barrier. Based on (1) through (3) stated above, it is inconsistent with the WTO agreement stipulating the prohibition of quantitative restrictions.

(5) Although the draft Directive lists lead, mercury and cadmium as dangerous substances, their use may sometimes reduce unnecessary environmental pollution. Their total ban, therefore, could be counterproductive, resulting in an adverse impact on the environment. For instance, these substances are often used in high sensitivity for detectors used in high sensitive analytical and medical equipment. A detector not using these substances is generally with inferior sensitivity, resulting in increasing the consumption of energy, as well as increasing the size of equipment. It, therefore, generates more negative impacts in terms of amount of resource used, transportation cost, energy increase required and adverse impact on the human body (an increase in X-ray exposure, for example).

(6) The listing up of exempted applications as provided in the Draft Directive will not cover every possible application such as the one mentioned in (5) above. The draft states that the list be reviewed and amended on a regular basis according to technical and scientific progress. Even an annual review could prevent certain equipment from being marketed during the inter-review period, thereby causing major damages with respect to environmental measurement and diagnosis.

3. Collection
1) The draft Directive states that Member States will have discretion to decide on the collection of waste from private households and that producers will be held responsible for the waste other than from private households. Many European countries, however, own the collection infrastructure operated and paid by municipalities. In view of economic efficiency, the existing collection network of municipalities should be utilized. Furthermore, collection cost should be borne by municipalities. Imposition of collection obligation anew on producers ignoring the existing collection network will result in unnecessary confusion and thus will run counter to the interest of all the concerned parties including municipalities, consumers, and producers.

2) In view of the business need for predictability, the meaning of "contaminant free" in Article 5.2 should be clarified.

4. Historical Waste
The provision to require producers to collect and recycle historical waste put on the market prior to the implementation of the Directive is unreasonable as it imposes retroactive responsibility on the producers. The European court judged in several cases that the provision of retroactive application was inconsistent with the principle of reasonable expectation and the principle of fair and equitable treatment so that it was invalid. The Directive cannot impose retroactive obligation on producers.
In addition, some products of household appliances have a long life extending to 10 to 20 years. In the event that take-back obligation applies to the historical waste, producers will become responsible for recycling the products put on the market 20 years before the implementation of the Directive. Under these circumstances, producers will be forced to bear an enormous cost. The lack of provision allowing producers to recover the cost incurred when they take back the product sold in the past will create an additional burden. This raises a concern that some enterprises may be forced to stop operating in Europe or to avoid making an investment in Europe. That is, responsibility for historical waste would lead manufacturers to having to build up accruals on their balance sheets for all products put on the market in the past and sold since then. These accruals would have to be included in the accounts in one financial year and cover all the estimated costs of dealing with historical waste. Therefore, the obligation to build up accruals could lead to technical bankruptcy for many companies.

5. Recycling cost
1) In order for manufacturers to fulfill recycling and treatment responsibility, they should be able to smoothly secure necessary fund through their business activities. How they can raise the fund smoothly varies from product to product. It depends on such factors as the ratio of recycling cost to the product price, the level of value added in the product, the recycling cost, the value of substances recovered in the recycling process, and the distribution channel of the product concerned. In addition, the recycling method erstwhile has differed from country to country so that the method available for the industry to choose from is likely to differ from country to country. In some cases the industry have to introduce a collective scheme to charge specific amount of recycling fee at the point of sales in order to collect sufficient fund for recycling. Therefore, the Directive should clearly state that the industry can charge the recycling fee and that it can choose the way to collect it, country by country and product by product, including a clear statement that the industry can introduce a collective scheme to charge specific amount of recycling fee at the point of sales in order to collect sufficient fund for recycling if they choose to do so.
For your information, in the Netherlands, the recycling cost of "IT equipment is borne by the manufacturer and that of household appliances is borne by the user." It is based on the sector specific reality in which some IT equipment can be taken back easily, and subsequently it can be reprocessed, and repaired (recycled) for marketing. On the other hand, the reality in case of the household appliance is that it goes through various distribution channels and its recycling is difficult from business point of view.

2) The Directive should clearly stipulate the time at which the obligation to bear the cost begins to accrue regarding product categories 2, 5, 6 and 9.

6. Recycling rate
1) In general, Life Cycle Assessment suggests that the environmental impact of heat recovery may be less than that of reuse and other means of recycling using a large amount of energy. Thus reuse and other means of recycling is not necessarily most environmentally friendly in all cases. In view of the objective of the Directive, which inter alia is to minimize the risk and impact on the environment associated with the treatment and disposal of the waste electrical and electronic equipment, heat recovery must be considered as one of the effective means of recycling.
In the Explanatory Memorandum, it is indicated that the experimental result demonstrates that 70% of small household appliances are recyclable. If the product contains a large amount of metal components, the recycling rate could reach as high as 70% by separating metal components. With respect to small household appliances containing a lot of plastic components, the recycling rate could not be so high.
In Japan, the recycling rates required by the law are 50% for refrigerators and washing machines, and 55% for television sets, and 60% for air conditioners. In comparison with these Japanese levels, the recycling rates of 70 to 90% required by the draft Directive are too high.
The Directive should provide, therefore, that the recycling rate, be determined based on the considerations given by the government and industry together after a certain period of time subsequent to the implementation of the Directive, taking into account other environmental loads, technical feasibility, and the data to be accumulated henceforth. At least, if high recycling rates are adopted, the heat recovery should be recognized as a permitted recycling option. On the other hand, if the heat recovery is not considered as a permitted recycling option, low rates should be adopted.If the rates are to be raised subsequently, they should be raised in phases taking into account technical progress, change in product generation, and so forth.

2) The recycling rate is not clearly defined in the proposed draft Directive. Therefore, it should be defined in concrete statement.

7. Regulation on recycling outside of the region
While being fully committed to the protection of environment, producers try to carry out recycling in a most efficient way from business point of view, by for instance taking back the products they sold all over the world and recycle them in one location. The draft Directive proposes to require that unless the non-EU treatment plant to which a producer wishes to transport its waste for treatment satisfies the EU technical requirement, the producer is not allowed exporting the waste out of the EU region. The environment and human safety in a third country ought to be protected by the country itself as it exercises its sovereignty and responsibility. Such a regulation unduly restricts recycling and treatment services in third countries. This regulation is inconsistent with the GATS from trade law perspective.

8. Removal of specified substances from waste equipment
The draft Directive requires that LCD (liquid crystal display) be removed from waste equipment. The LCD per se, devoid of back light and drive circuit board in the liquid crystal module, however, does not contain dangerous substances such as mercury, lead, and hexavalent chromium that are listed under Annex II.
The draft Directive requires that all liquids be removed during the treatment. However, LCD is a board made of a pair of glass or other materials between which a tiny amount of liquid crystalline material is sealed in. As the amount is minuscule, the liquid is held by surface tension with the board. Therefore, even if the glass or other board may be broken, the liquid crystalline material will hardly ever be released out of the LCD.
Based on the above-stated reasons, the LCD should be deleted from Annex III and a special provision should be added to exempt the LCD from the provision on liquid removal in Article 6.1.

9. OEM and recycling responsibility
The draft Directive does not clearly establish the locus of recycling responsibility in OEM products (irrespective of whether they are supplied as finished or semifinished products) whether it lies with the brand owner or non-brand owner (the entity that actually manufactures the product concerned for delivery to the brand owner). Realistically, as the deliverer has no knowledge about the marketing strategy including sales volume, sales price, etc. regarding the product itself, the recycling responsibility of OEM products should belong to the brand owner.
(Note) OEM (Original Equipment Manufacturing) products mean finished or semifinished products put on the market under the brand of the company which does not manufacture the products by themselves.

10. Responsibility of generators of waste (consumers)
For the purpose of protecting the environment, the Member States' government should be obliged to educate the people about the responsibility the waste generators (consumers) together with municipalities and producers have for reducing wasteful consumption of natural resources and preventing pollution. Consumers have the responsibility to cooperate for separate collection, not to put contaminated waste in the waste stream, and not to mix other things with the waste equipment. It should be clearly stated in the Directive that if consumers failed to discharge such a responsibility, municipalities and producers could reject the collection of the waste equipment from consumers and municipalities respectively.