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Online Sellers of Electrical and Electronic Equipment Become Focus of WEEE Workshop, with Recommendations for Future Obligations to Avoid “Free-riding”

On 13 September 2017, a workshop gathering more than 80 delegates from 12 different countries evaluated the impact of the waste electrical and electronic (WEEE) legislative framework on the compliance of online sellers. The workshop, to which European Commission officials also contributed, essentially focussed on one issue: How to deter online WEEE free-riding, i.e. online retailers failing to comply with WEEE regulations which in turn oftentimes leads to WEEE management costs having to be borne by companies supplying electrical and electronic equipment (EEE) that are properly compliant.

Hong Kong’s EEE producers may recall that, in mid-2012, Directive 2012/19/EU on waste electrical and electronic equipment (the “WEEE Directive”) was published in the EU’s Official Journal. The objective of this recast Directive is to increase the collection, reuse and recycling of EEE throughout the EU. Hong Kong traders should bear in mind that, for the purposes of the WEEE legislation, the definition of “producer” includes EU importers.

The recast Directive also requires Member States to maintain a register of EEE producers (including suppliers by means of distance communication) in order to monitor compliance. Each producer, or its authorised representative (AR), will have to register to submit the required information contained in Annex X (e.g., name and address, national identification code, category and type of EEE, how the producer meets its responsibilities, declaration that information is true, etc.).

Other relevant producer responsibilities, which were also there under the original WEEE Directive, will continue: for example, producers must provide a guarantee when placing products on the market that WEEE obligations will be financed. Producers are also allowed to set up and operate either individual or collective systems for fulfilling WEEE obligations provided they are in line with the objectives of the Directive.

The September workshop’s initial findings were produced by OECD member Peter Börkey, who estimated that 5 to 10% of all online sales are concerned by this free-riding issue. It was, however, mentioned that more extensive data would be necessary to quantify the full scale of the problem.

EucoLight (The European association of collection and recycling organisations for WEEE lamps and lighting) and the WEEE Forum (an NGO gathering 33 producers responsibility organisations), both attended the workshop. They retraced the main conclusions reached throughout the gathering, which can be summarised as follows.

The participants to the workshop first identified the core issue associated with the rising free-riding tendency, besides the fact that such behaviour fails to fulfil the WEEE legislation’s requirements. Free-riding creates a material commercial disadvantage for online sellers that ensure compliance with the WEEE legislation as well as for “bricks and mortar” retailers. As much as 80% of the problem is felt to be related to transactions that take place within the EU. This is despite the fact that, in many instances, the EEE being sold online will have originated in a non-EU territory, but is stocked by so-called “fulfilment houses” and other online economic operators within the EU Member States.

Participants at the workshop went on to formulate multiple recommendations to tackle this issue. If implemented, some of these changes could increase the obligations imposed on online retailers.

Their first recommendation is for online sellers to be legally required to take on the mantle of “producer” under the WEEE Directive, for the EEE which they sell on behalf of other companies that are not registered for WEEE.

Secondly, participants at the forum advised having recourse to the concept of Authorised Representative (AR) to solve this issue, in accordance with Article 17 and recital 8 of the WEEE directive. They underlined however that further analysis would be needed to define the AR’s liabilities. Article 17, on the appointment of an AR, stipulates that a producer established in one Member State can appoint a legal or natural person in another Member State to fulfil its WEEE obligations regarding the sales performed in that second Member State.

A third proposal concerned the creation of a certification system enabling WEEE compliant online retailers to advertise their certificate. In turn, this would enable customers to make informed choices. The ensuing related visible demand for WEEE compliance would allegedly put pressure on online retailers to embrace the new trend, thus encouraging certification even further.

In a less legislative fashion, other proposals were made to promote WEEE awareness. Starting from the observation that there was still a substantial number of online retailers that simply ignored their WEEE duties, some participants advised that, besides “hard law” changes, improving codes of conduct of online retailers and educating them regarding their WEEE obligations could already significantly impact the level of online WEEE compliance.

So far, none of these changes have been implemented, although both EucoLight and WEEE Forum are confident that the workshop has shed enough light on the issue to draw the interest of EU policy and law makers, and has laid out the foundations for future legislative changes.

Content provided by Picture: HKTDC Research
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