Draft Proposal for a

TABLE OF CONTENTS

2. Policy considerations *

3. objectives and main elements of the Proposal *

4. Environmental problems addressed in this Proposal *

5. Legislation on hazardous substances *

6. Internal Market aspects – Situation in the Member States *

7. International developments and Trade Aspects *

8. legal basis *

9. Subsidiary and proportionality *

10. Consistency with other community policies *

11. Economic assessment *

12. Consultation of stakeholders *

13. Data/Scientific Basis *

2. Introduction

The production of electrical and electronic equipment is one of the fastest growing domains of producing the production industry in the western world. Both technological innovation and market expansion continue to accelerate the replacement process. New applications of electrical and electronic equipment are increasing significantly. There is hardly any part of life where electrical and electronic equipment are not used. This development leads to an important increase of waste electrical and electronic equipment (WEEE).

The stream of WEEE constitutes a complex mixture of materials and components. In combination with the constant development of new materials and chemicals having environmental effects, this results in increasing problems at the waste stage. The stream of waste electrical and electronic equipment stands out from the municipal waste stream for a number of reasons:

• The rapid growth of WEEE is of concern. In 1998 6 million tonnes of waste electrical and electronic equipment were generated (4% of the municipal waste stream). The volume of WEEE is expected to increase by at least 3-5% per annum. This means that in five years 16-28% more WEEE is generated and in 12 years the amount is doubled. The growth of WEEE is about 3three times higher than the growth of the average municipal waste
• Due to their hazardous content electrical and electronic equipment cause important environmental problems during the waste management phase if not properly pre-treated. As more than 90% of WEEE are landfilled, incinerated or recovered without any pre-treatment, an important share of various pollutants found in the municipal waste stream comes from WEEE
• The environmental burden linked to the production of electrical and electronic products ("ecological baggage") exceeds by far the environmental burden linked to the production of materials constituting the other sub-streams of the municipal waste stream. As a consequence enhanced recycling of WEEE should contribute to important resource savings, in particular as regards the saving of energy.

In view of the environmental problems linked to the management of WEEE, Member States started to draft national legislation in this area. The Netherlands, Denmark, Sweden, Austria, Belgium and Italy have already presented legislation on this subject. Finland and Germany are expected to do so soon. Those Member States, which have so far not drafted national legislation, expressed their concern about the lack of harmonised European legislation for this waste stream during various consultation meetings preceding the present initiative.

With a view to the Internal Market, various problems result from national approaches on the subject of WEEE:

• The presence of different national policies concerning the management of WEEE hampers the effectiveness of national recycling policies, as transboundary movements of WEEE to cheaper waste management systems are likely to occur
• Different national applications of the producer responsibility principle lead to substantial disparities of the financial burden for economic operators

• Diverging national standards on "design for recycling", including the phase-out of specific substances, constitute technical barriers to the trade of electrical and electronic equipment.

In order to address the environmental problems associated with the current treatment and disposal of WEEE adequately, it is considered appropriate to setout measures that aim, firstly, at the prevention of WEEE, secondly at the re-use, recycling and other forms of recovery of such wastes, and thirdly at minimising the risks and impacts to the environment from the treatment and disposal of WEEE at Community level. It is also the aim of this initiative to harmonise national measures concerning the management of waste electrical and electronic equipment in order to ensure the functioning of the internal market and to avoid obstacles to trade and distortion of competition within the Community.

1. Policy considerations

Article 174 of the EC-Treaty establishing the European Community (EC-Treaty) states that Community policy on the environment shall aim at a high level of protection taking into account the diversity of situations in the various regions of the Community. It shall be based on the principles that preventive action should be taken, that environmental damage should as a priority be rectified at source and that the polluter should pay.

The Community pProgramme of policy and action in relation to the environment and sustainable development ("Fifth Environmental Action Programme") states that the achievement of sustainable development calls for significant changes in current patterns of development, production, consumption and behaviour. Furthermore, it advocates, in order inter alia, to reduce wasteful consumption of natural resources and to prevent pollution.

More specifically, the "Fifth Environmental Action Programme" contains an entire chapter dedicated to waste management issues, in which WEEE is mentioned as one of the normative target areas, in view of the application of the principles of prevention, recovery and safe disposal of waste.

The Council, in its Resolution of 7 May 1990 on Waste Management Policy, invited the Commission to establish action programmes for particular types of waste. Member States identified, inter alia, end-of-life electrical and electronic equipment as a waste stream to be addressed in this respect.

The Council, in its Resolution of 24 February 1997 on a Community strategy for waste management, invited the Commission to develop, as soon as possible, an appropriate follow-up to the initiative on Waste Electrical and Electronic Equipment.

The European Parliament, in its Resolution of 14 November 1996 (A4-0364/96) asked the Commission to present Proposals for Directives on a number of Priority Waste Streams, including electrical and electronic waste and to base such Proposals on the principle of producer responsibility. The European Parliament, in the same resolution, requests the Council and the Commission to put forward Proposals for cutting the volume of waste as well as reducing the presence of hazardous substances in waste such as chlorine, mercury, PVC,Polyvinyl Chloride (PVC), cadmium and other heavy metals.

2. objectives and main elements of the proposal

The proposed Directive will contribute to the protection of human health and the environment as required by Article 174 of the Treaty. The principal objectives of this Proposal are to protect soil, water and air from pollution caused by current management of WEEE, to avoid the generation of waste, which has to be disposed of and to reduce the harmfulness of WEEE. It seeks to preserve valuable resources, in particular energy. Another objective of the proposed Directive is the harmonisation of national measures on the management of WEEE.

The objectives are to be achieved by means of a wide range of measures, including measures on the design,on the separate collection of WEEE, on the treatment of WEEE and on the recovery of this waste.

• Manufacturers will be required to improve the design of their products in order to avoid the generation of waste and to facilitate the recovery and disposal of WEEE. To this end standards for such a design should be elaborated at European level. Substances causing major problems during the waste management phase, such as lead, mercury, cadmium, hexavalant chromium and certain brominated flame retardants, should not be used any more if substitution of these substances is feasible.
• Producers should take the responsibility for certain phases of the waste management of their products. This financial or physical responsibility creates an economic incentive for producers to adapt the design of their products to the prerequisites of sound waste management. The financial responsibility of economic operators should also enable private households to return the equipment free of charge
• Separate collection of WEEE has to be ensured through appropriate systems, so that users can return their electrical and electronic equipment. In order to create a common level playing field between the Member States a "soft" collection target is foreseen.
• In view of improved treatment and re-use/recycling of WEEE, producers have to set up appropriate systems. Certain requirements are prescribed as a minimum standard for the treatment of WEEE. Establishments carrying out treatment operations have to obtain a certification through the Member State. With regard to the obligation to re-use and recycle WEEE, targets are prescribed.
• In order to achieve high collection rates and to facilitate recovery of WEEE, users of electrical and electronic equipment have to be informed about their role in this system. The proposed Directive contains a labelling requirement for those equipment which might easily end up in a dustbin. In addition, it will be necessary that producers inform recyclers about certain aspects of the content of these equipment.

1. Environmental problems addressed in this proposal

In general terms, all equipment, which needs electricity to work properly is either electric or electronic. Each electric or electronic product consists of a combination of several basic building blocks. The basic building blocks common to electrical and electronic equipment are printed circuit boards/assemblies, cables, cords and wires, plastics containing flame retardants, mercury switches and breakers, display equipment, such as cathode ray tubes and crystal liquid displays, accumulators and batteries, data storage media, light generating devices, capacitors, resistors and relays, sensors and connectors. The most environmentally most problematic substances contained in these components are heavy metals, such as mercury, lead, cadmium and chromium, halogenated substances, such as CFCs, PCB,Chlorofluorocarbons (CFCs), PCBs, PVC and brominated flame retardants as well as asbestos and arsenic.

1. Current management of WEEE

The environmental risks linked to the waste stream are not properly dealt with by means of the current waste management practice. Today, more than 90% of WEEE are landfilled or incinerated without any pre-treatment. This leads to a considerable input of hazardous materials into the normal disposal routes.

1. Incineration of WEEE

Recent studies estimate that emissions from waste incineration account for 36 t/ytonnes per year of mercury and 16 t/ytonnes per year of cadmium in the Community. Furthermore, the incineration of non-hazardous wastes has been identified as the largest source of emissions of dioxins and furans to air in Europe. The stream of WEEE contributes significantly to the heavy metals and halogenated substances contained in the municipal waste stream. In addition, due to the variety of different substances found together in WEEE specific negative effects could occur during incineration. Copper is workingworks like a catalyst thereby increasing thereby the risk of formation of dioxins when flame retardants are incinerated. This is of particular concern as the incineration of brominated flame retardants at a low temperature (600-800°C) may lead to the generation of extremely toxic polybrominated dioxins (PBDDs) and furans, Polybrominated Disbenso Dioxins (PBDDs) and Polybrominated Disbenso Furans (PBDFs).

On 7 October 1998 the Commission adopted a Proposal for a Council Directive on the incineration of waste. This Proposal provides for stringent emission limit values, which should lead to a significant reduction of emissions of various pollutants into the atmosphere. It replaces Directive 89/369/EEC of 8 June 1989 on the prevention of air pollution from new municipal waste incineration plants and Directive 89/429/EEC of 21 June 1989 on the reduction of air pollution from existing municipal waste-incineration plants. However, for a number of reasons end of pipe technology could not be considered as the only method to avoid emissions from waste management operations. Separate collection and treatment of waste streams, such as WEEE, contributes to a cleaner municipal waste stream and thereby a reduction in the emissions caused by the incineration or the smelting of WEEE containing heavy metals and halogenated substances. This is of particular importance in those cases where the respective stringent emission standards are not implemented or not applicable as in the case of metal smelters.

Significant quantities of PVC are contained in WEEE. There is substantial evidence supporting the view that PVC is not suitable for incineration, particularly in relation to the quantity and the hazardous nature of the flue gas residues resulting from incineration.

incineration. In addition, losses of plasticizers, especially phthalates, from the landfilling of PVC are widely recognised and can have potential adverse effects on the human health and the environment. It should also be noted that very little quantities of PVC waste, in particular in WEEE, are currently recycled.

Apart from the air emissions, two other aspects linked to the incineration of WEEE are of importance. This concerns both installations complying with the provisions of the Proposal for a Council Directive on the incineration of waste and installations not complying with these provisions.

1. Pilot tests have revealed that common appliances such as TV sets yield a negative energy output throughout the incineration process. As an example the energy loss resulting from feeding glass - such as cathode ray tubes - into an incinerator was calculated to be -400 kj/kg.
2. The introduction of (small) WEEE into incinerators results in high concentrations of metals, including heavy metals, in the slag, in the flue gas or in the filter cake. According to the study "Modelmatige analyse van integral integraal van klein chemisch afval en klein wit- en bruingoed" almost all of the bottom ash produced in the Netherlands (around 600.000 tonnes in 1995) is disposed of in the road building sector where it is used as filling material. To be used in an environmentally safe way, the bottom ash has to meet physical and technical requirements, in particular leaching requirements. Even in those cases where bottom ashes containing certain concentrations of heavy metals are specifically cleaned they can only be used as construction material under additional environmental requirements. It had been calculated that if small white and brown goods were no longer incinerated with the rest of the waste the contents of copper, lead, nickel and other metals could be reduced to such an extent that the bottom ashes fall within the Dutch leaching requirements.

1. Landfilling of WEEE

Due to the variety of different substances contained in WEEE, negative environmental effects occur during landfilling of these wastes. Significant impacts could be prevented in those cases where WEEE is put on controlled landfills respecting environmentally sound technical standards. Nevertheless, as no landfill is completely water tight throughout its lifetime a certain leaching of metals and chemical substances cannot be excluded. It goes without saying that environmental impacts are considerably higher when WEEE is put on uncontrolled landfills, which still takes place to a significant extent in certain Member States and in most candidate countries for the accession to the European Union.

The risks relating to the landfilling of WEEE are due to the variety of different substances contained in WEEE. The main problems in this context are the leaching and evaporation of hazardous substances. Leaching of mercury takes place when certain electronic devices, such as circuit breakers are destroyed. The same is true for PCBs from condensors. When brominated flame retarded plastic or cadmium containing plastics are landfilled, both PBDE and thePolybrominated Diphenylethers (PBDEs) and cadmium may leach into the soil and groundwater. It had been found that significant amounts of lead ions are dissolved from broken lead containing glass, such as the cone glass of cathode ray tubes, by the acidic ground water often found in landfills.. Therefore, pollution from cone glass in landfills is likely.

Not only the leaching of mercury poses specific problems. The vaporisation of metallic mercury and dimethylene mercury, both part of WEEE, is also of concern. In addition, uncontrolled fires may arise at the landfills. Due to these fires both metals and other chemical substances, such as the extremely toxic dioxins and furans (TCDD -Tetrachloro-dibenzo-dioxin, PCDDs, PBDDs and PCDFs - polychlorinated and polybrominated dioxins and furans)including Tetrachloro-dibenzo-dioxin (TCDD) and Polychlorinated and Polybrominated Dioxins and Furans (PCDDs, PBDDs and PCDFs) from halogenated flame retardant products and PCB containing condensors can be emitted.

2. Recycling of WEEE

One of the main objectives of the present initiative is to increase the recycling of WEEE. In general, increased recycling saves resources and capacities of disposal, in particular landfill. In spite of the positive effects, the recovery operation might add to environmental pollution if the waste is not properly pre-treated.

Due to plastics containing halogenated substances, both dioxins and furans are generated as a consequence of recycling the metal content of WEEE. Halogenated substances contained in WEEE, in particular brominated flame retardants, are also of concern during the extrusion of plastics, which is part of the plastic recycling. Due to the risk of generating dioxins and furans, recyclers usually abstain from recycling flame retarded plastics from WEEE. In view of the lack of proper identification of plastic containing flame retardents and inherent difficulty to distinguish flame retardetretardant plastic from ordinary plastic most of the recyclers do not process any plastic from WEEE.

Environmental problems during the recycling of WEEE are not only linked to halogenated substances. Hazardous emissions to the air also result from the recycling of WEEE containing heavy metals, such as lead and cadmium. These emissions could be significantly reduced through the substitution of the respective materials by less polluting substances in new electrical and electronic equipment and by means of proper pre-treatment of WEEE. Another problem with heavy metals and halogenated substances in untreated WEEE occurs during the shredding process. As in most cases WEEE is shredded without proper disassembly, hazardous substances, such as PCBs contained in capacitors, may be dispersed into the recovered metals and the shredder waste.

1. Resource aspects

Through the current management of WEEE valuable materials are disposed of and lost for future generations. Along with the loss of resources, substantial pollution of the environment through mining is of concern. It is not possible to give exact figures on the environmental impacts of the extraction of all the materials contained in electrical and electronic equipment. This depends very much on the concrete site and region of the extraction of the materials. However, the processes leading to the extraction of these metals and their general impacts on the environment are well known and documented.

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2. The principle of producer responsibility

The polluter pays principle is laid down in Article 174 of the EC-Treaty. The idea behind this principle is to make those persons responsible for environmental pollution which have the possibility to improve this situation. Producers of electrical and electronic equipment design the product, they determine its specifications and select its materials. Only producers can develop approaches to the design and manufacture of their products to ensure the longest possible product life and, in the event that it is scrapped, the best recovery and disposal.

At the moment there is hardly any economic incentive for the producer to take waste management, in particular recycling aspects, into consideration at the design stage. In this context, producers who have invested in design for recycling complain about the lack of financial incentives to maintain this product policy. As a result such actions run the risk of being discontinued. Therefore, this Proposal seeks to extend the traditional role of producers by making them responsible for the management of electrical and electronic products at their end of life. Specialised recyclers confirm the practical relevance of improved design for recycling in the area of electrical and electronic equipment.

In line with the principle of producer responsibility, producers will have to finance the treatment, recovery and environmentally sound disposal of waste electrical and electronic equipment from private households. For practical reasons many producers prefer to organise the financing of waste management collectively, which should be possible under the present Proposal. However, the main benefits of the producer responsibility concept could be achieved if economic operators fulfil their responsibility individually to benefit directly from their design for recycling. As a consequence, the present Proposal encourages producers to opt for a system of individual responsibility.

In order to reduce costs for producers resulting from the management of waste from products put on the market before entry into force (historical waste) of this legislation a transition period of five years after entry into force of the Directive is granted. While the concerns of most sectors of the electronic industry will be met by this transition period, producers of products with longer lifetimes might need further assistance to address the problem of historical waste. In this context, the Proposal allows producers to cover these costs through a visible, fixed fee put on the price of new products. However, this possibility is limited to a period of ten years after entry into force of the WEEE Directive.

For electrical and electronic equipment not used by private households, the financing of the waste management will need to be agreed between the producer and the user of the equipment at the time of purchase. This is in line with conventional business practice.

1. Legislation on hazardous substances

1. Policy considerations

In line with the Communication on the review of the Community strategy for waste management from 1996, the Proposal provides for the reduction of the content of certain hazardous materials in WEEE, including lead, mercury, cadmium, hexavalent chromium, polybrominated biphenyls (PBB) and polybrominated diphenylethers (PBDEs). In this respect, the Proposal follows the principles of existing Community waste legislation, which already included restrictions on the marketing of hazardous substances. Examples can be found in the European Parliament and Council Directive 94/62/EC on packaging and packaging waste and the Council Directive 91/157/EEC on batteries and accumulators containing certain dangerous substances as amended by Commission Directive 98/101/EC adapting to technical progress Directive 91/157/EEC.

The use of the mentioned substances needs to be substituted in electrical and electronic equipment. However, in those cases where such a substitution is not feasible, because suitable alternatives are not available, exemptions of the requirement to substitute need to be granted. These exemptions should be listed in an Annex to the Directive and should be regularly amended in light of technical and scientific progress.

 

2. Risks related to the targeted substances

Lead

Lead can cause damage to both the central and peripheral nervous systems of humans. Effects on the endocrine system have also been observed. In addition, lead can have negative effects on the blood system and the kidneys. Lead accumulates in the environment and has high acute and chronic toxic effects on plants, animals and micro-organisms.

Under Council Directive 67/548/EEC on the classification and labelling of dangerous substances as amended lead compounds are classified:

- R20/22 Harmful by inhalation and if swallowed

- R33 Danger of cumulative effects.

The relative importance of any single source of exposure is difficult to predict and will vary with geographic location, climate and local geochemistry. In any case, consumer electronics constitute 40% of lead found in landfills. The main concern in regard to the presence of lead in landfills is the potential for the lead to leach and contaminate drinking water supplies.

Cadmium

Cadmium compounds are classified as toxic with a possible risk of irreversible effects on human health. Cadmium and cadmium compounds accumulate in the human body, in particular in kidneys which byin time may lead to their damage. Cadmium is adsorbed through respiration but is also taken up with food. Due to the long half-life (30 years) cadmium can easily be accumulated in amounts that cause symptoms of poisoning. ByWith prolonged exposure cadmium chloride may cause cancer. Cadmium shows a danger of cumulative effects in the environment due to its acute and chronic toxicity.

Under Council Directive 67/548/EEC on the classification and labelling of dangerous substances Cadmiumcadmium compounds are classified:

- R23/25 Toxic by inhalation, if swallowed

- R33 Danger of cumulative effects

- R40 Possible risks of irreversible effects.

Mercury

Inorganic mercury spread in the water is transformed to methylated mercury in the bottom sediments. Methylated mercury is easily accumulatingaccumulated in living organisms and concentrates through the food chain via fish. Methylated mercury has chronical effects and causes damage to the brain.

Under Council Directive 67/548/EEC on the classification and labelling of dangerous substances Mercurymercury is classified:

- R23/24/25 Toxic by inhalation, in contact with skin and if swallowed

- R33 Danger of cumulative effects.

Under Council Directive 67/548/EEC on the classification and labelling of dangerous substances mercury alkyls and inorganic compounds of Mercurymercury are classified:

- R26/27/28 Very toxic by inhalation, in contact with skin and if swallowed

- R33 Danger of cumulative effects.

It is estimated that 22 % of the yearly world consumption of mercury is used in EEE.electrical and electronic equipment.

Hexavalent Chromium (Chromium VI)

Chromium VI can easily pass through membranes of cells. Accordingly, Chromiumchromium VI is easily absorbed and produces various toxic effects within the cells. Therefore, Chromium VIchromium VI is considered as an important risk for the environment in industrialised countries. Furthermore, Chromium VI causes strong allergic reactions. Small concentrations of chromium VI in the environment might lead to an increase of allergies. Asthmatic bronchitis is another allergic reaction linked to chromium VI. Chromium VI is also considered genotoxic, potentially damaging thethe DNA.

In addition, hexavalent chromium compounds are assumed to be toxic for the environment.

As regards possible exposure, chromium VI contained in wastes can easily leach from landfills which are not appropriately sealed. During incineration of chromium VI contaminated wastes the metal evaporates through fly ash. Chromium VI in the fly ash is easily soluble. There is agreement among scientists that wastes containing chromium should not be incinerated.

Brominated Flame retardants

Brominated flame retardants aretoday regularly designed into electronic products today as a means for ensuring flammability protection. The use is mainly in four applications: in printed circuit boards, in components, such as connectors, in plastic covers and in cables. 5-, 8- and 10-BDE are mainly used in printed circuit boards, in plastic covers of TV sets and in domestic kitchen appliances.

One of the main objectives of the present Proposal is to divert WEEE from disposal operations and to increase recycling of this waste. This is in particular true for plastics, which constitutes 20% of the composition of WEEE. One of the main impediments as regards the recycling of this fraction is the risk of dioxin and furan generation by certain brominated flame retardants during the recycling of the respective plastic. In particular, it has been shown that Polybrominated Diphenylethers (PBDEs) formed the toxic polybrominated disbenso furans (PBDF) and polybrominated disbenso dioxins (PBDD) during the extruding process, which is part of the plastic recycling process. As a consequence, the German chemical industry stopped the production of these chemicals in 1986.

In addition, high concentrations of PBDEs have been found in the blood of workers in recycling plants. Various scientific observations indicate that PBDEs might act as encocrineendocrine disrupters.

The presence of Polybrominated Biphenyls (PBBs) in Arctic seal samples indicates a wide geographical distribution. The principal known routes of PBBs from point sources into the aquatic environment are PBBs plant areas and waste dumps. PBBs are almost insoluble in water and are primarily found in sediments of polluted lakes and rivers. PBBs have been found to be 200 times more soluble ina landfill leachate than in distilled water; thiswater. This may result in a wider distribution in the environment. Once theyPBBs have been released into the environment, they can reach the food chain, where they are concentrated. PBBs have been detected in fish from several regions. Ingestion of fish is a source of PBB transfer to mammals and birds. Neither uptake nor degradation of PBBs by plants has been recorded. In contrast, PBBs are easily absorbed by animals and although they have been found to be very persistent in animals, small amounts of PBB metabolites have been detected.

2. Internal Market aspects – Situation in the Member States

1. Situation in the Member States

In view of the environmental problems linked to the management of WEEE, Member States started drafting national legislation. The Netherlands, Denmark, Sweden, Austria, Belgium and Italy have already presented legislation on WEEE. Finland and Germany are expected to do so soon. Those Member States, which have so far not drafted national legislation, expressed their concern about the lack of harmonised European legislation for this waste stream during various consultation meetings preceding the present initiative.

Since the mid-1990ies Austria has legislation on the take back and recovery of lamps and white goods. Initially the recovery systems for both product groups were financed through a fee on the price of new products. Due to competitive disadvantages of the Austrian retailers of white goods compared to competitors in Germany and Italy an end-of-life fee was introduced and the fee on the product price was reduced accordingly. A draft ordinance on the overall WEEE-stream was published in March 1994 but further discussions were suspended to wait for the entry into force of EU-legislation.

A regulation covering brown and white goods in the Flemish Region of Belgium was adopted in 1998. Manufacturers, importers, distributors and retailers are obliged to take back free of charge all kinds of white and brown goods as well as IT-equipment.Information Technology (IT)-equipment. Recycling targets for ferrous and non-ferrous metals and for plastics are included in the regulation.

According to the statutory order, from January 1999 Danish local authorities will be responsible for the collection and recovery of Brown and White Goods, IT and telecommunication equipment, monitoring equipment, equipment for medical and laboratory use and other electrical and electronic equipment. To fund this, end-users would be charged through local taxes or collection fees.

In Germany an ordinance on the take-back and recycling of WEEE is in the final stages of the legislative procedure. The draft foresees the responsibility of local municipalities to collect WEEE and the responsibility of producers to treat, recover and dispose of this waste.

An Italian Decree on waste management of December 1997 foresees take-back and recovery obligations for several durable goods in domestic use, such as White Goods, TVs and certain IT equipment. On the basis of agreements with Industry a nation-wide network of collection centres and recovery facilities shall be set up. End-users have to deliver this equipment to an authorised dealer or to public or private waste management organisations.

On 1 June 1998 a regulation establishing rules for taking back and processing white and brown goods after use came into force in the Netherlands. According to this legislation consumers can give back WEEE free of charge to the supplier or to the local authority. Subsequently, manufacturers and importers must process the concerned items. The landfilling or incineration of WEEE collected separately will be prohibited.

In April 2000 Sweden adopted an ordinance for WEEE allowing consumers to bring back their waste to retailers or municipal collection points. Costs of recycling will be borne by either the municipalities or the manufacturers. WEEE may not be landfilled, incinerated or shredded without treatment by a certified operator. This ordinance is expected to come into effect on 1 July1 July 2001.

There are many examples of the regulation of lead-containing products and of particular uses of lead such as:

• In Austria, there are restrictions on the lead content of fertilisers, as well as on the use of sewage sludge if the heavy metal contant in either the soil or the sludge exceeds certain limits. A similar ordinance has been adopted by Finland and drafted by the German government.
• In Denmark, a regulation on lead-containing products is under way. The draft regulation contains a general prohibition (with exemptions) on the sale of products containing lead substances. The sale of a range of specified products containing lead is also prohibited.
• In Sweden, there are initiatives to phase out lead use in many products including cables, solder, light bulbs, cathode rays and keels.

Examples for legislation on other heavy metals are the Dutch Cadmium Decree 1999 prohibiting the use of cadmium as pigments, dyes, stabilisers and plating. A similar ordinance has been adopted by the Austrian government in 1993. In Austria the content of mercury in lamps is limited to 15 mg per lamp. In 1998 the Netherlands also enacted a general phase-out of mercury in products.

The Swedish National Chemicals Inspectorate proposed a ban of PBDE and PBB, which is currently considered within the Swedish government, while Austria banned the use of PBB already in 1993. Factually, the use of PBDE is prohibited in Germany as certain limit values for brominated furans and dioxins may not be exceeded according to the national Chemicals-Prohibition-Ordinance. This corresponds to a voluntary commitment to discontinue the use of PBDEs given by German Chemicals Industry in 1989.

1. The Internal Market

With regard to the Internal market three main problems resulting from national approaches towards the management of WEEE can be identified:

• Different national applications of the principle of producer responsibility might lead to substantial disparities of financial burden for the economic operators

• The presence of different national policies on the management of end-of-life electrical and electronic equipment could hamper the effectiveness of national recycling policies, as transboundary movement of WEEE to cheaper waste management systems could occur

• Diverging standards on the "design for recycling", including the phase-out of specific substances, could constitute technical barriers to the trade of electrical and electronic equipment.

In view of the developments in the Member States, it is necessary to provide for harmonisation of the environmental objectives and the responsibilities of the various actors as regards the management of WEEE at Community level.

1. International developments and Trade Aspects

1. International developments

The OECDOrganisation for Economic Co-operation and Development (OECD) considers the concept of Extended Producer Responsibility (EPR) as a policy tool to minimise waste. It is intended to develop a guidance document as a basis for governments wishing to implement EPR. In this context, WEEE was identified as one of the priority areas for action.

Apart from a voluntary system on "Extended Product Responsibility" no legislative actions on waste from electrical and electronic equipment is envisaged at Federal level in the United States. Contrary to that, various US States have introduced a landfill disposal ban on White Goods and Cathode Ray Tube containing equipment, including an advanced disposal fee on new appliances.

A Bill for the Recycling Law for Home Electric Appliances was adopted by the DietJapanese Parliament (Diet) in May 1998. According to the law retailers have to collect television sets, refrigerators, washing machines and air conditioners from consumers. These items will be transferred to the manufacturers who are responsible for further treatment, in particular recycling. Retailers and manufacturers will collect charges necessary to cover the cost of recycling the waste. A similar ordinance has been adopted in Taiwan. This ordinance entered into force on 1 March 1998.

In Switzerland an ordinance on the take back and disposal of electrical and electronic appliances entered into force on 1 July 1998. In Norway an ordinance on the acceptance, collection, recycling and disposal of discarded electrical and electronic equipment was adopted in March 1998.

2. Trade aspects

The proposed Directive will uniformly apply to all electrical and electronic equipment on the EU market, independently from where these products have been manufactured. The proposed measures are necessary to fulfil the objectives of the Directive. In any case, all measures in the proposed Directive have been designed in such a way so as to meet international obligations and to minimise potential trade impacts. The need to avoid unnecessary obstacles to trade has been duly taken into account.

2. legal basis

The content of most of the measures set out in the Directive focus primarily on anthe improvement of the management of WEEE. Therefore, this Directive is based on Article 175 of the EC Treaty.

3. Subsidiarity and proportionality

1. Subsidiarity

Measures of environmental protection and those with an impact on the internal market fall within both the competence of the Community and the Member States. Measures on WEEE constitute a clear example of this competence sharing. In accordance with the principle of subsidiarity (Article 5 of the Treaty) the Community shall take action, in areas which do not fall within its exclusive competence, only if and in so far as the objectives of the proposed action cannot be sufficiently achieved by the Member States and can therefore, by reason of the scale or effects of the proposed action, be better achieved by the Community:

• The pollution caused by the management of WEEE is of transboundary nature. This is in particular true for the pollution of the air or water resulting from the incineration, landfill or improper recycling of WEEE
• For various parts of WEEE recycling is economically viable only if large quantities of waste are processed. In the light of the principle of economies of scale only a few centralised installations in Europe would process these wastes. Cathode ray tubes are an example for this situation. Sufficient quantities of this equipment could only be processed if WEEE is collected in several European countries
• Individual national approaches on WEEE lead to various problems for the Internal Market as described in the chapter "The Internal Market". These problems could only be addressed by Community measures.

While devising collection, treatment and financing systems of the management of WEEE, national and regional conditions have to be taken into account. The present initiative leaves sufficient flexibility to the Member States to take these aspects into consideration. The proposed Community legislation is limited to the prescription of the main principles of WEEE management and financing. Only those principles are established, which are needed to avoid the distortion of the Internal Market.

1. Proportionality

The Proposal focuses exclusively on the key elements for actions to be taken with regard to Waste Electrical and Electronic Equipment, such as prevention, collection, treatment and recovery as well as financing. In addition, it only introduces obligations, which are necessary to achieve the environmental objectives, in accordance with the proportionality principle.

It has been argued that the substitution of hazardous substances in new electrical and electronic equipment might be redundant as WEEE would be collected separately, thereby removed from the general waste stream and treated separately. However, various estimations of the quantity of WEEE indicate that the "soft" collection target of 4 kg per inhabitant, as set out in Article 5 of the Proposal, constitutes only 25 % of the overall annual generation of WEEE. Although the appropriateness of the indicated target was confirmed by the experience with Dutch WEEE legislation, it remains to be seen whether other Member States attain the collection target in the medium term. As a consequence, the substitution of the hazardous substances, as laid down in Article 4 of the Proposal, is the only feasible way to reduce the presence of these substances in the waste stream.

It has been demonstrated that the attribution of the economic responsibility for the treatment, recovery and disposal of WEEE to producers constitutes an important incentive to improve the design of electrical and electronic equipment, which takes waste management aspects into account. Contrary to that, there is no evidence that the attribution of the collection of WEEE from private households to producers would have an impact on the design of the equipment. Therefore, the responsibility of producers is limited to the actual treatment, recovery and disposal of this waste. For practical reasons producers will have to pick up the waste from designated collection points.

1. Consistency with other community policies

The objectives of the Proposal are fully in line with the Treaty requirements for environmental protection and the rights of consumers. They are also in line with the requirements of the internal market, such as the elimination of obstacles to the free movement of goods and services as well as the elimination and prevention of distortions of competition. As regards Community waste management policy the present initiative complements legislation on the disposal of waste (ie landfill and incineration of waste) as well as legislation on specific waste streams, such as batteries.

Landfilling of waste

The Directive 1999/31/EC on the landfill of waste foresees that only waste that has been subject to treatment can be landfilled. It falls into the scope of the present initiative to complement the Landfill Directive by stipulating concrete requirements as regards the treatment of WEEE.

Incineration of waste

Waste going to incinerators has to be pretreated for various reasons. All residues from the incineration process, including slags, fly ash and filter cake are used in other processes, for example as construction material. The recoverability of these residues depends on their amount of (heavy) metals,(heavy) metal context, which is linked to the quality of the material introduced in the incineration process. As a consequence, a treatment operation as foreseen in the present initiative contributes to a reduction of various metals in the respective residues. In addition, both investments and operating costs of the flue gas cleaning could be reduced if wastes put to incineration contain less heavy metals or halogenated substances.

Batteries

An important share of heavy metals, such as lead and cadmium, in the municipal waste stream comes from batteries. As a consequence, Directive 91/157/EEC on batteries and accumulators containing certain dangerous substances requires the collection of these batteries. However, as up to 90 % of consumer batteries are integrated in electrical and electronic equipment without being removed by the consumer prior to disposal of the equipment, the separate collection of these equipment – as foreseen under the present Proposal – constitutes an indispensable part of an efficient collection scheme for batteries.

Climate change and legislation on ozone depleting substances

The present initiative is explicitly recognised as a useful vehicle for reducing HFChalogenated flourocarbons (HFC) emissions in the EU Post-Kyoto strategy. Furthermore, the present Proposal concretises the general stipulations on the recovery of used controlled substances contained in Council Regulation (EC) 3093/94 on substances that deplete the ozone layer.

Primary production of metals constitutes 10% of the world CO₂ emissions. Depending on the metal between 70% and 95% of the energy used for the primary extraction of metals could be saved through enhanced recycling. In view of the fact that more than 3,5 million tonnes of metals are contained in the WEEE generated annually, the present Proposal contributes significantly to the CO₂ reduction required to achieve the Kyoto targets.

2. Economic assessment

1. Implementation costs

1. Separate collection and re-use/recycling

On the basis of available information, the total net costs of meeting the collection and re-use/recycling requirements for household WEEE of the proposed draft Directive are likely be in the range of 500-900 million €/yr for the EU15. The requirements for commercial equipment might, according to a rough estimate, add around 20% to this figure. An extrapolation of Dutch figures, derived from the practical experience with national WEEE legislation in 1999, indicates costs for public relations, consultancy, overhead costs of collection and recovery systems etc. of around 100 million € in the first year with a downward tendency over time. If all these costs were passed on directly to the consumer through the product price, this would lead to an average price increase of 1% for most electr(on)ic goods but could go up to 2-3% for some product categories, such as refrigerators, TVstelevisions and other monitors.

It is, however, likely that these calculated costs are overstated due to economies of scale, avoided disposal costs etc. Furthermore, these costs are based on the assumption that Member States were not undertaking their own initiatives. However, 10 of the current 15 Member15 Member States have already implemented or intend to implement separate collection and recycling schemes for WEEE. Therefore, the incremental costs of the EU Proposal will be substantially lower than the above-mentioned figures.

Collection Costs for Household Equipment

Assuming a collection of 4 kg per inhabitant, the total collected quantity of waste electrical and electronic equipment under the Directive will be 1.5 Millionmillion tonnes. The averages of reported collection costs are in the range of 200 to 400 €/t. Taking these figures, overall collection costs for the EU 15 would be between 300 and 600 Million600 Million €/yr. It is, however, likely that these costs will come down over time once the basic investments for the collection infrastructure are made, logistics hashave been optimised and consumer awareness has led to higher collection rates.

Recycling Costs for Household Equipment

Recycling costs differ largely according to the equipment types. Costs for large household equipment typically range from around 10 to 80 €/t. Costs for refrigerators are usuallyare in the area of 200 to 300 €/t, for monitor containing equipment 100 to 800 €/t and small household equipment 200 to 500 €/t. On the basis of various pilot projects and assuming a waste composition of 70% large household goods, 15% monitor containing equipment and 15% small household equipment, roughly a range of 200 to 300 M €/yr has been calculated as recycling costs according to the requirements of the Directive.

This estimation is confirmed by first results from the Dutch recovery system for waste electrical and electronic equipment. In 1999, the recycling costs per million inhabitants were € 695,000. Extrapolated to the total EU population, this would amount to a cost of 258 M €/yr.

2. Hazardous substance reductions in new equipment

A number of manufacturers hashave already phased out lead, mercury, cadmium, hexavalent chromium and halogenated flame retardants in various applications. This suggests that the costs of doing so are quite limited.

The only issue where more substantial costs have been claimed by industry is lead in solders. According to calculations of the Commission, the additional operational costs of using tin-based solders are roughly estimated to be about 150 million €/yr. Annualised investment costs are thought to be relatively low. On this basis, the total price increase would remain very small for most products (e.g. 0.0006 to 0.003 € per telephone, 0.003 to 0.017 € per calculator and 0.03 to 0.17 € per TV).television). As a conclusion, the issue of replacement of lead in solders is thought to be more an issue of fine-tuning alternative technologies than a cost question.

2. Benefits of the Proposed Directive

1. Financial benefits

From a purely financial point of view, there are three main types of benefits:

• Production costs for the virgin material, which is replaced by secondary material can be saved. This is the reason for already existing re-use and recycling activities. Since secondary materials are in competition with virgin materials, the price difference will determine which source producers will use. This is, however, already taken into account in the above calculated cost figures which are net costs
• Disposal costs can be saved through re-using/recycling higher levels of waste electrical and electronic equipment. Assuming that the majority of WEEE would go to landfills with higher standards than today (at a cost of 50 €/tonne), cost savings due to reduced landfill space would be around 50 million € for EU15. Further financial cost reductions may be due to the reduced amount of hazardous components going into shredders.
• Finally, the costs for re-use and recycling will be lowered in future through better design of new equipment due to the feedback mechanism of producer responsibility and through additional instruments such as design standards and general obligations for Member States to encourage eco-design.

1. External benefits

The main reason for the need to legislate in this field is the existence of externalities, i.e. environmentali.e. environmental impacts that are not integrated in the price of the product and that are usually paid for bythe society via cleanup costs or environmental degradation. Although there is general awareness about the problems associated with waste electrical and electronic equipment, very little research exists that could give a monetary evaluation of the externalities linked to the current management practices of this waste. The absence of such an analysis, for what is a politically pressing issue, cannot however be construed as a reason for inaction.

The main benefits of separate collection and recycling are:

• the avoidance of external costs due to the possible use of the resources contained in the waste electrical and electronic equipment which would otherwise go to disposal (around 6 million tons6 million tonnes annually). At a collection rate of 4 kg per inhabitant, more than 1 million tonnes of materials could be diverted and reintroduced into the economic cycle. It is difficult to evaluatein how far the true costs of using resources today instead of leaving them for future generations and/or distributing them in a more equitable way among the world´s population are reflected in the price of virgin material. Sustainable resource use is, however, one of the questions at the core of the principle of sustainable development
• the avoidance of external costs caused by negative impacts on the environment from incinerating and/or landfilling waste electrical and electronic equipment. After treatment of collected equipment, only 10-30% of the original weight would be sent to final disposal. The remaining fraction after treatment (around 100 000 tons) can be sent to specialized installations, if necessary for hazardous waste. Waste fees usually do not distinguish between waste materials causing different environmental impacts since they are usually based on weight or flat rates. The external costs caused by current management of waste electrical and electronic equipment are without any doubt higher than for average types of waste, due to the content of hazardous materials in WEEE. These external costs will therefore be particularly high for refrigerators containing CFCs or cathode ray tube containing equipment

• the avoidance of external costs caused by negative impacts on the environment from the production of virgin materials. Inter alia, the recycling of WEEE is estimated to contribute to energy savings in the order of 120 million Giga Joule (equivalent to about 2.8 million tonnes of oil) annually. An estimated 60% to 80% savings in energy can be obtained due to using the materials recycled under the present Proposal as compared to the use of virgin materials (compare Annex I).

• The effects of producer responsibility and the other measures aiming at better design of new equipment are likely to reduce not only the financial costs of re-use and recycling but also the impacts on the environment from the waste management of the equipment. It is, however, difficult to give a quantitative evaluation of these effects since they will depend on the design of national implementation measures and the reaction of the market onto these measures.
• The risks of the substances targeted by this Proposal have been described in chapter 5.2. The absence of a well established knowledge on concrete pollution pathways, dose-response functions on living organisms, risks of potential incidents and the value that society puts on the absence of these risks makes it, however, impossible to put a concrete monetary value on these externalities. Due to the inherent toxicity of these substances and the fact that they may reach the environment in a bioavailable form, associated risks are in any case substantial. Whenever more environmentally friendly substitutes exist at a reasonable price, prevention at source therefore is likely to be preferable to end of pipe solutions.

1. Life Cycle Assessment and Life Cycle Financial Analysis

A 1999 study for the UK DTIUnited Kingdom’s Department of Trade and Industry investigated in detail the environmental and financial balance of re-use and recycling activities according to the proposed targets including alternative costs for disposal and the production of virgin materials.materials. The study shows that already today relatively high rates of re-use and recycling are achieved for many equipment types. These activities seem to be profitable even from a purely financial perspective. Increasing the levels will raise costs. Markets for the re-used/recycled equipment need to be created. However, the study concludes that the scenario according to the targets of this Proposal can be seen as cost-effective from a financial point of view.

An increase of re-use and recycling up to the targets of this Proposal will result in lower environmental impacts except for refrigerators and TVtelevision sets. The study, however, does not attempt to value certain effects which are particularly serious such as the release into the environment of CFCs from refrigerators and of heavy metals from monitors.

1. Macroeconomic effects

A key factor when considering the possible effects of a change in product pricechanges is whether the demand for the goods in question is elastic or inelastic. A Dutch study on this subject suggests that the demand for a number of electronic goods, especially the large white goods and several brown goods can be qualified as inelastic (refrigerator, washing machine, heating boiler, television and computer) given the types of prices changes that are likely to be involved (1-3%). In other words, over the long term the level of sales is not likely to be affected by these types of price changes.

For certain other products, mainly consumer electronics such as hifihi-fis or shavers, demand might be qualified as partially elastic. The maximum calculated loss of sales is 1-2% assuming an average price increase of 1%. This effect and the associated indirect cost is, however, likely to diminish as economies of scale and innovation bring down the costs of separately collecting and treating WEEE.

Consequently, the measure will have some effect on prices, inflation, aggregate demand etc. These effects are howeverare, however, likely to be relatively limited.

1. Consultation of stakeholders

In 1994 and 1995 representatives of Member States, all relevant economic operators and environmental NGOs participated in a Project Group, which worked out an information and a recommendation document on the management of WEEE. Subsequently, all stakeholders were consulted on discussion papers preceding the present Proposal.

In general, all Member States welcome the initiative of the European Commission. AtOn various occasions Member States expressed the opinion that at least a legally binding framework at Community level had to be created. With regard to the collection of WEEE, the majority of Member States favoured a system where both local municipalities, retailers and producers share financial and technical responsibility. Responsibility for treatment, recovery and disposal of WEEE should be given to producers. Flexibility for national solutions was advocated for any financing scheme on WEEE.

• In the consultation meetings with Industry, support for a harmonised European approach in the area of WEEE was expressed in order to avoid a distortion of the Internal market. Furthermore, the objectives of the Proposal were welcomed by Industry. The phase-out requirement in a waste management Directive was considered inappropriate although in substance the need for minimisation of the use of the concerned substances was widely accepted. Industry accepted a certain involvement in the recycling stage of their products. In this context, one part of industry favoured a transparent payment system not influencing the relationwhich would not influence the relationship between producers and distributors. Other parts of industry expressed their interest in a competitive financing system without transparent fees put on the product price.
• In June 1999 a draft Proposal for a WEEE Directive was submitted to the business test panel as a pilot project. Out of the 611 businesses consulted, 188 were affected by the Proposal. Several businesses which participated in the consultation exercise suggested that the responsibility for the waste fromthe electrical and electronic equipment should be shared. In particular, municipalities, retailers, distributors, manufacturers and recyclers should work together to take-back and recycle the electrical and electronic equipment from private households. In addition, some businesses advocated the removal or delay of the material bans.
• The Commission initiative on WEEE was welcomed by the environmental NGOs, which favoured the principle of producer responsibility. According to the NGOs the prevention of the generation of WEEE should be stressed. This involves the encouragement of producers to produce products with longer lifetimes. The provision on the substitution of substances was supported by NGOs, which asked for an extension of this requirement to additional halogenated substances, in particular PVC.

1. Data/Scientific Basis

The proposed Directive is based on scientific evaluations of the impacts of the current management of WEEE in different Member States. More than a dozen collection and recovery pilot projects undertaken throughout the European Union provided data on this issue. The studies listed in Annex III are examples of the scientific basis for the proposed Directive.

The sectors most likely to be affected by the proposed Directive are the electronic component suppliers, the equipment producers, the electrical repairers and the waste collection and treatment industry. The effects on the waste collection and treatment industry will almost certainly be positive. The Directive will force an expansion of the treatment and recycling market and by consequence the number of jobs in the sector. Depending to some extent on how the financing mechanism is set up, there is, however, the risk that producers decide to establish their own collection and/or recycling systems to the detriment of the existing traditional recycling companies.

Sectors such as producers of domestic appliances (Nace 29.7), computers and office equipment (Nace 30) telecom equipment (Nace 32.2), consumer electronics (Nace 32.3) and light bulbs (Nace 31.5) are dominated by just a few firms that typically account for 80% of turnover and jobs in the sector. Nevertheless, there are still over 100,000 companies in the electronics industry that employ less than 20 people each but account for 180,000 jobs out of total of 1.4 million jobs in the sector. The electronic components sub-sector (Nace 32.1) is less concentrated than the other sub-sectors with a substantial proportion of jobs and turnover accounted for by SMEs.

Metal recyclers are located in all Member States.

Manufacturers of electrical and electronic equipment are mainly located in Germany, the United Kingdom, France, Italy, the Netherlands and Sweden.

The measure is addressed to the Member States. Business will have to comply with the national legislation implementing this measure.

Business involved in the production of electrical and electronic equipment will have to include waste management considerations into the design and production of the equipment. These waste management considerations include the use of easily recyclable/recoverable materials, the control of hazardous substances, the use, where feasible, of recycled materials and of common component and material coding standards. In certain cases they will have to substitute heavy metals, such as mercury, lead, cadmium and hexavalant chromium as well as certain brominated flame retardants.

Undertakings or enterprises involved in the treatment of WEEE will have to fulfil a number of technical requirements laid down in Article 6 of the proposed Directive and the Annexes. Although it is difficult to predict precisely where investments will have to be concentrated across the sectors since there are vast differences in the structures and in the geographical location of the businesses, in some cases it is estimated that the investments to be made in order to comply with these requirements may be considerable. The real extent of these investments will also depend on whether national or regional legislation is already in place. Where such legislation exists, industry will more easily be able to comply with the requirements of the Proposal.

Establishments and operators carrying out treatment operations shall also be required, in order to operate, to request an authorisation from public authorities.

The internalisation of the waste management costs in the price of electrical and electronic products may lead to:

1. changes in the sales of products;
2. other effects, such as changes in the purchasing "moment", moves within price segments or loss of spending power.

A key factor when considering the possible effects of product price changes is whether the demand for the goods in question is elastic or inelastic. The work done by the consultancy KPMG suggests that the demand for a number of electronic goods, especiallythe large white goods and several brown goods can be qualified as inelastic (refrigerator, washing machine, heating boiler, television and computer) given the types of prices changes that are likely to be involved (1-3 %). In other words, over the long term the level of sales is not likely to be affected by these types of price changes.

For certain other products, mainly consumer electronics such as hifihi-fis or shavers, demand might be qualified as partially elastic. The maximum calculated loss of sales is 1-2% assuming an average price increase of 1%. This effect and the associated indirect cost is likely to diminish as economies of scale and innovation bring down the costs of separately collecting and treating WEEE.

Increasing the product price may also lead to either advanced or postponed purchase behaviour. The latter is likely to occur although probably only to a relatively small extent. Similarly, consumers might choose to shift between product price categories opting for cheaper and less performing models thus forcing a reducing thereduction of `welfare’the ‘welfare’ of these consumers.

Recycling of WEEE is labour intensive. This has impacts on the costs of managing WEEE but produces significant benefits in the area of job creation. Accordingly, national governments presented their WEEE legislation both as part of environmental and social policy. In this context, various projects have shown that dismantling of WEEE is particularly suitable for the integration of long-term unemployed and handicapped in the work process.force.

According to German practice an annual turnover of 5 Miomillion Euro should enable recycling companies to employ 30 people on a permanent basis and around 70 further people in associated enterprises. Based on a minimum collection amount of 4 kg WEEE per inhabitant and year the overall recycling costs amount to 525 Mio Euro throughout Europe. Accordingly, around 10,500 jobs could be created by recycling alone. Many jobs moremore jobs will be created through the collection and the transport of WEEE. On the basis of US Studies on recycling and employment on average one job is created for 465 tonnes of processed material. Accordingly, the job potential for recycling 6 million tonnes of WEEE amounts to approximately 13,000 new jobs.

From the consultation carried out with European associations of SMEs involved in the management of WEEE, it appears that the most important variable to take into consideration is the time spantime-span necessary to make the investments and develop the necessary environment-related skills. This time spantime-span is estimated to be approximately six months for dismantling operators. The Proposal provides for a sufficient transitional period, since the Directive will have to be transposed by Member States 18 months after its coming into force.

Several International, European and National business organisations have been consulted between 1994 and 1999 before finalising this Proposal. The International and European organisations include:

Abschlußbericht des Arbeitskreises 13 "Elektronikschrott" (Niedersachsen 1998), Kommission der Niedersächsischen Landesregierung zur Vermeidung und Verwertung von Abfällen.

Apparetour Back to the beginning - National pilot project, for collecting, recycling and repairing electrical and electronic equipment in the district of Eindhoven (Eindhoven 1997), Ploos van Amstel Milieu Consulting B.V.

Collection and treatment of end-of-life Electrical and Electronic Equipment, (December 1996),(December 1996), Basque Government Ministry of Territory, Housing and Environment.

Collection and treatment of waste from electrical and electronic products (Oslo 1996), Ministry of the Environment.

Collection targets for waste from electrical and electronic equipment (Germany 1998), European Commission DG XI.

Comparison of Systems for Collection/Recycling/Disposal of End-of-life Electrical and Electronic Equipment, Economic Impact (Vienna 1996), Austrian Electrical and Electronic Industries Association.

Economische effecten verwijderingsbijdrage wit- en bruingoed (Den Haag 1995), KPMG.

Electrical and Electronic equipment – the basis for producer responsibility (Stockholm 1995),(Stockholm 1995), Swedish Environmental Protection Agency.

Electrical and electronic waste. Sales, quantities of waste and treatment (Oslo 1996), Hjellnes Cowi AS.

Electrical/Electronic Products Recycling in Germany (UK 1995), C. Voûte, Recycling and Waste Control Officer, Corporation of London.

Electronic and Electrical Equipment, (Stockholm 1995), Swedish Environmental Protection Agency.

Elektronikschrott Projekt Weiz - Modellversuch zur Sammlung, Demontage und Verwertung von Elektro- und Elektronikaltgeräten im Bezirk Weiz (Graz/Österreich 1995), Amt der Steiermärkischen Landesregierung.

End-of-life management of cellular phones – an industry perspective and response (London 1997), ECTEL Cellular Phones Takeback Working Group.

Entsorgung von Elektro- und Elektronik-Altgeräten (Wien 1995), Interdisziplinäres Projekt- Technischer Umweltschutz Universität für Bodenkultur und Technische Universität Wien.

Environmental Aspects of PVC (Kopenhagen 1996), Danish Environmental Protection Agency.

Environmental Consequences of Incineration and Landfilling of Waste from Electr(on)ic Equipment (Copenhagen 1995), Nordic Council of Ministers.

Erfassung von Elektro-Haushalt-Kleingeräten aus Haushalten mit verschiedenen Erfassungssystemen (Germany 1995), Zentralverband Elektrotechnick- und Elektronikindustrie e.V. (ZVEI).

Etude de faisabilité – Recyclage du materielmatériel électrique et électronique (Bruxelles 1996), Institut Bruxellois pour la Gestion de l’Environnement.

Evaluierung von Systemvarianten für die Sammlung und Verwertung von Elektroaltgeräten (Wien 1997), Bundesministerium für Umwelt, Jugend und Familie.

Extended Producer Responsibility: Take-Back Programmes and International Trade Law - ENV/EPOC/WMP/RD(97)3 (Paris 1997).

Lead-Free Solder Project – NCMS Report 0401RE96, Ann Arbor, Michigan 1997.

Lead-Free Soldering, An Analysis of the Current Status of Lead-Free Soldering - UK DTIUK DTI 1999.

Life Cycle Assessment and Life Cycle Financial Analysis of the Proposal for a Directive on Waste from Electrical and Electronic Equipment (UK 1999), Ecobalance UK and DMG Consulting Ltd for UK Department of Trade and Industry.

Modelmatige analyse van integraal verbranden van klein chemisch afval en klein wit- en bruingoed (Netherlands 1996), TNO rapport voor VROM/DGM (Directie Afvalstoffen)

Pilotprojekt zur Erfassung von Elektroaltgeräten (Germany 1997), Interseroh AG.

Pilotsammlung von Elektroaltgeräten in Bregenz – Wissenschaftliche Begleitstudie (Bregenz/Österreich 1996), Bundesministerium für Umwelt, Jugend und Familie.

Priority Waste Streams Waste From Electrical and Electronic Equipment – Information Document (Rome 1995), Italian National Agency for New Technology, Energy and the Environment.

Produits électriques et électroniques non portables en fin de vie en région Rhône-Alpes (France 1997), Fédération des industries électriques et électroniques.

Recovery of WEEE: Economic and Environmental impacts. (UK 1997), European Commission DG XI.

Report on the UK industry for recycling end of life electrical and electronic equipment second draft (London 1998), ICER – Industry Council for electronic equipment recycling.

Sammlung von Elektroaltgeräten im Flachgau – Wissenschaftliche Begleitstudie (Wien 1997),(Wien 1997), Amt der Salzburger Landesregierung.

Switching on to Electronic Waste Recycling (UK 1998), Save Waste & Prosper Ltd.

Umweltverträgliche Produktgestaltung (München 1998), Ferdinand Quella/Siemens (editor) Publicis MCD Verlag.

Waste from electrical and electronic products -– a survey of the contents of materials and hazardous substances in electric and electronic products (Copenhagen 1995), Nordic Council of Ministers.

Verwertung von Elektro- und Elektronikgeräten (Essen 1994), Landesumweltamt Nordrhein-Westfalen.

Unplugging electrical & electronic waste -– The findings of the LEEP Collection Trial (Edinburgh 1997), Lothian & Edinburgh Environmental Partnership.

Article 1 sets out the objective of the Directive.

Article 1 reflects the twofold aim of the proposed Directive.

Article 2 contains the definitions for the purposes of this Directive.

The definition of electrical and electronic equipment (Article 2.1) comprises all appliances run by electricity and being part of the categories set out in Annex I A of the Proposal. The purpose of the indicated voltage limits is to ensure that large industrial equipment, which might be construed as falling under one of the categories of Annex I A, are not covered by the Proposal. The voltage limits are the upper limits set out in Article 1 of Council Directive 73/23/EEC of 19 February 1973 on the harmonisation of the laws of Member States relating to electrical equipment designed for use within certain voltage limits. Voltage ratings refer to the voltage of the electrical input or output, not to voltages, which may appear inside the equipment.

Components are parts of electrical and electronic equipment, such as housings, screens, keyboards, electric motors, circuit boards, capacitors, rectifiers, transistors, tubes, etc. Sub-assemblies are parts of the equipment - not necessarily parts of the electricity flow - without which the original piece of equipment could not operate as intended by the manufacturer. Examples for sub-assemblies are shelves in a refrigerator. Consumables are short-term replaceable/disposable parts of the equipment, such as toner cartridges or batteries. The provisions regarding waste electrical and electronic equipment apply only in those cases to components, sub-assemblies and consumables when these materials are part of the product at the time ofthe discarding.

With a view to avoiding discrimination of European based manufacturers, the term producer (Article 2.9) includes professional importers of electrical and electronic equipment into a Member State and anyone who places electrical and electronic equipment via the mailmail-order or similar courier arrangement, on to the market of another Member State. Producers for the purposes of this Directive are not suppliers or manufacturers of individual components, subassemblies or consumables. In those cases where companies market products under their own brand, which have been originally manufactured by other companies, the definition of producer applies to the companies marketing the products rather than to the original manufacturers.

According to the definition of waste electrical and electronic equipment from private households (Article 2.10) special equipment, such as radio therapy equipment, would – due to its nature - not fall under the requirements of the Proposal applying to equipment from private households. Computer systems, however, which might according to their nature be used by private households, and are used in a given case by a small company, such as a law firm, would fall under the definition of WEEE from private households. In the case this law firm uses a number of computers, which clearly exceeds the number of computers usually found in private households, the end-of-life computers would – due to their quantity - not fall under the definition of WEEE from private households.

Article 3 sets out the scope of the proposed Directive. The proposed Directive shall apply to all categories of electrical and electronic equipment listed in Annex I A. This list is exhaustive. Examples forof equipment falling under each of these categories are given in Annex IAnnex I B. In view of the rapidly changing market of electrical and electronic equipment it was considered useful to avoid an exhaustive list of equipment. It follows clearly from national experiences that an exhaustive product list would be subject to permanent updating.

Due to the specific distribution of products, such as medical equipment systems, monitoring and control equipment and automatic distributors, it was not considered necessary to apply the same collection, financing and user-information provisions to these products as to equipment mainly or exclusively used by consumers. Also the product legislation, in particular the substance legislation, of this Proposal does not apply to the mentioned categories. This is due to the large number of specific applications of the targeted substances, which could not be substituted at this stage.

As regards medical equipment systems, implants are not covered by the scope of the proposed Directive.

Article 4 requires certain measures aiming at the prevention of the generation of WEEE, in particular the generation of hazardous waste. These measures include provisions enhancing the recycling and other forms of recovery of WEEE, thereby avoiding the generation of waste going to disposal operations.

The most important steps to improve the waste management of electrical and electronic equipment have to be taken in the design stage of the new products. To this end, Member States shall encourage research aimed at reducing the use of dangerous substances in electrical and electronic equipment. (Article 4.1).(Article 4.1).

In order to facilitate the identification of plastics three ISO standards for the marking of plastic products shall be applied (Article 4.2).

To avoid diverging national standards for the design of electrical and electronic equipment within the European Union the Commission should promote, as appropriate, the preparation of European standards according to Article 4.3.

Article 4.4 foresees the requirement to substitute the heavy metals – lead, mercury, cadmium and hexavalent chromium – as well as the brominated substances – PBDE (polybrominated diphenyl ethers), including in particular 5-BDE, 8-BDE and 10-BDE, and PBB (polybrominated biphenyls), as these substances are causing significant environmental problems during the waste management phase. Exemptions for applications where substitution is not feasible are listed in Annex II. The inserts included in Annex II should be modified according to technical and scientific progress by the Article 18 Committee of Directive 75/442/EEC. The committee shall consult producers of electrical and electronic equipment before taking decisions on further exemptions to the substitution requirment.

Article 5 foresees the separate collection of WEEE. One of the main problems regarding current waste management practice of WEEE is the lack of collection enabling recyclers to obtain sufficient material for large-scale production. This is in particular true for electrical and electronic equipment used in private households. As a consequence, Member States have to ensure that collection systems are set up.

The main challenge to create efficient collection systems is to motivate consumers to participate. However, in view of the principle of subsidiarity, only general requirements for collection systems could be set in the proposed Directive. Measures ensuring an efficient collection system may vary according to the different product groups of this waste stream and the specific features of the different regions within the EU and should therefore be taken at national or regional level. The main principles set out in the present Proposal include the requirement of setting up collection points, which are easily accessible for consumers and the possibility for consumers to return their equipment free of charge.

In order to avoid substantial disparities of the financial burden linked to the WEEE management, a harmonised standard for the collection success needs to be established. However, at this stage it is not possible to indicate a legally binding collection target lacking precise data on the annual arisings of WEEE from private households. Therefore, a "soft" collection target was indicated, which serves as an orientation for the Member States. The indicated amount of 4 kg of WEEE per inhabitant is an average amount, which should be achieved per inhabitant. It represents a typical average collection yield that has been achieved by several countries of the European Union in the course of pilot collection schemes and corresponds to the collection achieved in practice under the Dutch WEEE legislation. At a later stage, after experience hadhas been gathered during the implementation of the WEEE Directive, compulsory targets shall be formulated.

Article 6.1 in connection with Annex III specifies the necessary treatment measures. These include the removal of those substances, which constitute the main difficulties at the various stages of the management of WEEE. In any case, the possibilities of re-use and recycling shall be considered when these treatment operations take place.

The Proposal introduces a permit requirement for establishments or undertakings, which are carrying out treatment operations. This permit includes the treatment requirements and the requirements with regard to the treatment site. In addition, the compliance with the re-use and recycling targets set out in Article 7 is part of the permit.

Producers should have the possibility to set up centralised large-scale treatment plants in order to make recycling economically interesting.viable. As a consequence,According to Article 6.5 stresses their possibility to undertake the treatment operation outside the Member State where the WEEE is generated.

Article 7 sets a standard for the recycling of WEEE. In general, recycling targets are considered necessary to avoid the limitation of recovery to incineration or the removal of a few valuable materials only, sending the rest to disposal operations. The recycling target of 90% for large household appliances has been achieved by large pilot tests and confirmed by specialised recyclers. Behind this target there is also the decision for sendingto send the appliances to domestic appliances shredder,appliance shredders, rather than to ordinary car shredders, which merely achieve targets of around 70%. Pilot tests have shown that the large scale recycling of small WEEE could on average be achieved to an extent of 70%. Using the well established "end cut technology" at least 90% of the materials of gas discharge lamps, in particular mercury containing lamps, could be recycled/re-used. While recycling of new equipment containing cathode ray tubes is already feasible, the large bulk of appliances collected today is of a quality which merely allows 70% recycling. In the medium to long term the recycling of cathode ray tubes has to aim at the re-utilisation of the cone glass for new cathode ray tubes.

The recycling targets of Article 7 merely refer to the waste equipment, which has been separately collected according to Article 5 of the Proposal. The re-use of components, not the re-use of whole appliances, contributes to the achievement of these targets.

In line with the principle of producer responsibility, producers of electrical and electronic equipment have the obligation to recycle as well as to dispose of the non-recoverable fractions. Producers could discharge of their respective responsibility by leaving the actual work to third parties, which might be local municipalities or private enterprises.

It is essential to promote the use of recycled material in new electrical and electronic equipment. This has to be taken into account in national public procurement policies (Article 7.5).(Article 7.5).

Article 8 establishes the financing system for the management of WEEE. One aim of the financing system is to encourage consumers to return their equipment to collection points, rather than disposing of it through the ordinary municipal waste collection or other channels leading to inappropriate treatment. It is clear from the pilot projects on WEEE that charging consumers with disposal costs at the point of return would have negative repercussions on the collection results. Therefore, and in line with the principle of producer responsibility, producers have to finance the treatment, recovery and environmentally sound disposal of waste electrical and electronic equipment from private households. Their responsibility should start from designated collection points onwards.

The financing obligation for waste from products put on the market before entry into force (historical waste) starts five years after entry into force of the Directive, to exclude the problem of historical waste for all producers of equipment, with a usual turnover time of less than five years. For other equipment remaining costs for historical waste should be covered through a visible fee on the price of new products. However, this possibility is limited to a period of ten years after entry into force of the WEEE Directive. While the financing of historical waste needs to be organised through collective systems, producers need to have the possibility to decide, how to discharge of their responsibilities regarding waste from products put on the market after entry into force of the legislation.

The Commission is required to monitor possible market distortions through national financing systems or changes of the distribution system, shall submit a report thereof to the European Parliament and Council and, if necessary, propose to the European Parliament and the Council an amendment to Article 8.

Article 9: As regards electrical and electronic equipment not used by private households, the financing of the waste management needs to be agreed between the producer and the user of the equipment at the time of purchase.

Article 10 foresees the information, which shall be given to consumers, the participation of which is of paramount importance for the functioning of collection schemes. A specific means of information is the marking of certain small electrical and electronic equipment to avoid their disposal via the ordinary rubbish bin or a similar means of municipal waste collection.

Article 11 ensures that producers provide treatment facilities with information on the content of electrical and electronic equipment in order to facilitate the recycling of these appliances and to prevent negative impacts on the health of workers or the environment due to hazardous substances contained in electrical and electronic equipment. The information needed by treatment facilities should be provided on request of the recycler and might take the form of databases, manuals or information on the internet.

Article 12 stipulates that Member States have to provide information needed to assess the success of this legislation and to estimate future arisings of WEEE.

Annex IA contains an exhaustive list of those categories of electrical and electronic equipment, which are covered by the present Proposal.

Annex IB contains a list illustrating for each of the categories examples for products covered by the respective category.

Annex II contains the list of applications, which are exempted of the substitution requirement foreseen in Article 4 of the Directive. These exemptions cover all cases where no viable substitution for the concerned substances exist at the moment. The list needs to be regularly updated according to scientific and technical progress.

Annex III lists those substances or preparations, which have to be removed from separately collected WEEE for environmental reasons.

Annex IV foresees certain minimum conditions as regards the conditions of the WEEE storage and treatment sites.

Annex V provides for the marking, which has to be put on equipment fitting into dustbins or similar means of household waste collection.

Draft Proposal for a

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular Article 175 thereof,


Having regard to the Proposal from the Commission,


Having regard to the opinion of the Economic and Social Committee,


Having regard to the opinion of the Committee of Regions,


Acting in accordance with the procedure laid down in Article 251 of the Treaty,


Whereas

1. The objectives of the Community’s environment policy, as set out in Article 174 (1) and (2) of the EC Treaty, aim in particular at preserving, protecting and improving the quality of the environment, protecting human health and utilising prudently and rationally natural resources. Whereas this policy shall be based on the principles that preventive action should be taken, that environmental damage should as a priority be rectified at source and that the polluter should pay;
2. The Community programme of policy and action in relation to the environment and sustainable development ("Fifth Environmental Action Programme") states that the achievement of sustainable development calls for significant changes in current patterns of development, production, consumption and behaviour and advocates, in order inter alia, to reduce wasteful consumption of natural resources and to prevent pollution; whereas this programme mentions Waste Electrical and Electronic Equipment (WEEE) as one of the normative target areas, in view of the application of the principles of prevention, recovery and safe disposal of waste;
3. The Review of the Community Waste Strategy stresses the need to reduce the content of hazardous substances in waste suggesting the potential benefits of EC-wide rules limiting the presence of such substances in products and in production processes. It also states that where the generation of waste cannot be avoided, it should be reused or recovered for its material or energy.
4. The Council, in its Resolution of 24 February 1997 on the Community strategy for waste management, invited the Commission to develop, as soon as possible, an appropriate follow-up to the projects of the priority waste streams programme, including WEEE;
5. The European Parliament, in its Resolution of 14 November 1996 asked the Commission to present Proposals for Directives on a number of Priority Waste Streams, including electrical and electronic waste and to base such Proposals on the principle of producer responsibility. The European Parliament, in the same resolution, requests the Council and the Commission to put forward Proposals for cutting the volume of waste as well as reducing the presence of hazardous substances in waste such as chlorine, mercury, Polyvinyl Chloride (PVC), cadmium and other heavy metals;
6. Article 2(2) of Council Directive 75/442/EEC of 15 July 1975 on waste, as last amended by Commission Decision 96/350/EC, provides that specific rules for particular instances or supplementing those of the said Directive on the management of particular categories of waste may be laid down by means of individual Directives;
7. The amount of WEEE generated in the European Union is rapidly growing, the content of hazardous components in electrical and electronic equipment constitutes a major concern during the waste management phase and recycling of WEEE is not undertaken to a sufficient extent;
8. The objective of improving the management of WEEE cannot be achieved effectively by Member States acting individually; whereas in particular diverging national approaches as to standards for "design for recycling", including the substitution of specific substances, constitute technical barriers to the trade of electrical and electronic equipment; whereas different national applications of the producer responsibility principle lead to substantial disparities of the financial burden for economic operators; whereas the presence of different national policies concerning the management of WEEE hampers the effectiveness of national recycling policies;
9. The scope of the legislation should comprise all electrical and electronic equipment used by consumers and those electrical and electronic equipment destined for professional use, which risk to end in the municipal waste stream;
10. Community waste management policy attaches priority to the prevention of waste, in particular hazardous waste; this implies the reduction of hazardous substances in new electrical and electronic equipment. The prevention of waste from electrical and electronic equipment also requires improved design, which takes waste management aspects into account. As national design standards for electrical and electronic equipment might lead to a distortion of the internal market, these standards need to be elaborated at European or international level.
11. The Commission shall promote, as appropriate, the preparation of European standards relating to the design of electrical and electronic equipment, which takes into full account and facilitates the repair, the possibility of upgrading, the re-use, the disassembly and the recycling of such equipment.;
12. Separate collection is the precondition to ensure specific treatment and recycling of WEEE; whereas consumers have to actively contribute to the success of this collection and should be encouraged to return WEEE. For this purpose convenient facilities for the return of WEEE, including public collection points, where private households should be able to return their waste free of charge, have to be set up;
13. A collection target for WEEE used by private households should be aimed at, in order to attain harmonised environmental objectives in the European Union and more specifically to ensure that Member States strive to set up efficient collection schemes;
14. A specific treatment for WEEE is indispensable in order to avoid the dispersion of pollutants into the recycled material or into the waste stream; whereas the recycling facilities have to comply with certain minimum standards to prevent negative environmental impacts linked to the treatment of WEEE;
15. A high level of recovery, in particular re-use or recycling, should be achieved and producers encouraged to integrate recycled material in new equipment;
16. Basic principles with regard to a financing of the WEEE management have to be set at Community level and financing schemes have to contribute to high collection rates as well as to the implementation of the principle of producer responsibility; to achieve the benefits of the producer responsibility concept most efficiently, producers should be encouraged to fulfil their responsibility individually;
17. Users of electrical and electronic equipment from private households should have the possibility to return WEEE free of charge; whereas producers setting up WEEE management schemes individually should not be discriminated compared to producers setting up collective management schemes (pools); whereas financing also has to be ensured for waste from products which have been put on the market before the entry into force of the present legislation;
18. Information of the users about the collection systems and their role in the management of WEEE is indispensable for the success of WEEE collection; whereas this information implies the proper marking of those electrical and electronic equipment, which could end up in rubbish bins or similar means of municipal waste collection;
19. Information for treatment facilities provided by producers is important to facilitate the management, in particular the treatment, of WEEE;
20. Information on the numbers and weight of electrical and electronic equipment put on the market in the European Union and the rates of collection and recycling of WEEE is necessary to monitor the success of collection schemes;
21. The format for information on the collection success and the adaptation to scientific and technical progress of the requirements for treatment facilities and the treatment of WEEE as well as of the targets for re-use and recycling should be effected by the Commission under a Committee procedure.

HAVE ADOPTED THIS DIRECTIVE:

Article 1

Objectives

This directive lays down measures which aim, as a first priority, at the prevention of waste electrical and electronic equipment, and in addition, at the reuse, recycling and other forms of recovery of such wastes so as to reduce the disposal of waste. It also seeks to improve the environmental performance of all economic operators involved in the life cycle of electrical and electronic equipment and in particular operators directly involved in the treatment of waste electrical and electronic equipment.

Article 2

Definitions

For the purposes of this Directive:

Article 3

Scope

Article 4

Prevention