Consultation on charging fees for applications for exemptions to the Restrictions of the Use of Certain Hazardous Substances in Electrical and Electronic Equipment Regime

Page 1 of 3

Closes 26 Aug 2022

Introduction

The Restriction of the Use of Certain Hazardous Substances in Electrical and Electronic Equipment Regulations 2012 (RoHS Regulations) restricts the use of 10 hazardous substances in electrical and electronic equipment (EEE) with a view to contributing to the protection of human health and the environment, including the sound recovery and disposal of waste.

Industry can apply for exemptions to allow the supply of products using one or more of the restricted substances above the threshold limits set down in the RoHS Regulations where specified criteria are met. Applications for exemptions are made to the Secretary of State under regulation 6 of the Hazardous Substances and Packaging (Legislative Functions and Amendment) (EU Exit) Regulations 2020 (2020 Regulations). Any exemption that is granted can be used across industry, not just the business that applied for the exemption. Exemptions are granted where it is determined that the necessary criteria have been met following a detailed evaluation conducted in accordance with regulation 5 of the 2020 Regulations.

The RoHS Regulations closely follow restrictions placed on the use of hazardous substances in EEE in the EU RoHS Directive(2011/65/EU)[1]. Applications for exemptions in the EU are determined by the European Commission. Decisions are published and adopted by means of a delegated act. Following the UK’s withdrawal from the EU, the function of granting, renewing and revoking exemptions were, in relation to Great Britain, transferred to the Secretary of State by the 2020 Regulations using powers in section 8 of the European Union (Withdrawal) Act 2018 (the Withdrawal Act).

This transferred function represents a new cost to the public purse which the government is now seeking to recover from organisations that submit applications for exemptions under the 2020 Regulations on a cost recovery basis.

We are now proposing to use powers in the EU Withdrawal Act (Schedule 4, Part 1, paragraph 1) to make new regulations that would allow the Secretary of State  to charge a fee to recover costs incurred by government in determining applications for exemptions to the substance restrictions in the RoHS Regulations. 

The purpose of this survey is to seek views on this proposal. 

 

1. What is your name?
2. What is your email address?
3. What is your organisation?
4. Do you agree or disagree that the gov should introduce a fee, charged on a cost recovery basis, for processing applications for an exemption to the Restriction of the Use of Certain Hazardous Substances in Electrical and Electronic Equipment Regulations?
(Required)

Background on exemptions

The EU RoHS Directive limits the use of specified hazardous substances in the manufacture of certain electrical and electronic products.  The UK played a key role in developing the original European legislation, and the RoHS Regulations transposed the EU RoHS Directive into UK law. The RoHS Regulations limits for the use of 10 substances and maximum concentration values tolerated by weight in homogeneous materials as follows:

Lead (0.1%)

Mercury (0.1%)

Cadmium (0.01%)

Hexavalent chromium (0.1%)

Polybrominated biphenyls (PBB) (0.1%)

Polybrominated diphenyl ethers (PBDE) (0.1%)

Butyl benzyl phthalate (BBP) (0.1%)

Dibutyl phthalate (DBP) (0.1%)

The scope of the RoHS Regulations is wide ranging, covering most types of electrical and electronic equipment intended for household or commercial use. A limited list of products is exempt such as large-scale fixed installations, large-scale industrial tools, military equipment, items designed specifically for R&D, and most forms of transport and active implant devices.

As explained above, businesses can apply for exemptions that allow the manufacture and supply of products that exceed these threshold limits where it can be proven that alternative less hazardous substances are not available. Following the UK withdrawal from the EU, the Secretary of State now has the power to determine applications for exemptions for products supplied to or in Great Britain. Businesses can apply to the Secretary of State for new exemptions and renewal of existing exemptions.  A list of existing exemptions can be found in Table 1, Schedule A2,  of the 2012 RoHS Regulations[1].

This transferred function represents a new cost to the public purse which the government is now seeking to recover from organisations that submit applications for exemptions under the 2020 Regulations on a cost recovery basis.

 

[1] Table 1, Schedule A2 of the 2012 RoHS Regulations https://www.legislation.gov.uk/uksi/2012/3032/schedule/A2

 

5. Do you agree or disagree that the proposed fee of £39,721 appears to be reflective of the costs likely to arise in appraising and processing applications?
(Required)

Breakdown of fee

We propose a flat fee of £39,721 per application. This sum is based on the cost of external technical support procured to support the determination of applications, our experience of costs associated with determining recent applications made under transitional provisions in the 2020 Regulations and estimated costs of consulting on applications. It is proposed that the fee:

  • is paid at the time the application is submitted.  
  • is refunded on a pro-rata basis should the application be withdrawn, to ensure only costs incurred up to that point are charged to the applicant.
  • is partially refunded where it is deemed the resources incurred in processing and appraising the application falls below the level of fee charged

Activity

Cost

Consideration of matters relevant to the application, including matters in regulation 5(2) to (5) of the 2020 Regulations and the technical support required to consider such matters.

Matters include

  • The availability and reliability of substitute materials and the socio-economic impact of substitution
  • Whether the duration of the exemption, which will usually be 5 or 7 years will have any adverse impacts on innovation
  • the  overall environmental, social and economic impacts of the exemption for the duration of  the exemption
  • the exemption does not breach environmental protection afforded by REACH

£14,835

Preparation and publication of consultation

£11,583

Analysis of consultation responses and publication of summary of responses to the consultation

£12,452

Other administrative costs including publication of a summary of the application

£851

Total

£39721

 

In which circumstances would a fee not be required?

The 2020 Regulations made provision for transitional measures (regulations 9 and 10) in respect of the applications made to the EU before the end of the Transition Period but where a decision on those applications had not been made before 31 December 2020. These transitional measures remove the need for businesses to make separate applications to GB and allow the Secretary of State to decide whether or not to follow EU decisions on these transitional cases.

The proposal to charge a fee for determining applications for exemptions made under regulation 6 of the 2020 Regulations will not apply to these transitional cases. In other words, the fee will not apply to applications for exemptions that were submitted to the EU while the UK was still a member of the EU for which a decision remained outstanding on 31 December 2020.

Where the Secretary of State uses powers in Regulation 5 of the 2020 regulations to grant an application with no fee is payable.

What happens if Defra cannot process an application?

As is the case now, the onus will be on the applicant to provide all the information necessary to process their application. If the applicant is unable to provide all the necessary information the fee will be retained and the processing of the application will be suspended until the information is received or until the application is withdrawn.

6. Do you agree or disagree that, should an application be withdrawn, the fee should be refunded on a pro-rata basis, to reflect costs incurred until that point?
(Required)

Partial refund of fee

We are proposing that the fee is refunded on a pro-rata basis should the application be withdrawn, to ensure only costs incurred up to that point are charged to the applicant.

 

7. Do you agree or disagree that, in circumstances where we are able to process an application more quickly or cheaply than expected, we should refund the difference back to the applicant?

Partial refund of fee

We  propose that the fee is partially refunded where it is deemed the resources incurred in processing and appraising the application falls below the level of fee charged

8. Do you agree or disagree that a commencement date of 6th April 2023 for the charging is sufficient time for business to adjust to the introduction of an application fee?
(Required)

Commencement 6th April 2023

We intend subject to the outcome of this consultation, to lay Regulations in Parliament this year.  Once approved by Parliament, these Regulations would make provision for the introduction of an application fee from 6th April 2023.

9. Do you agree or disagree with our assessment of the impact that the application fee will have on business?
(Required)

Impacts on business

Our initial analysis indicates that the overall impact the charge will have on businesses will be low. Annual costs to businesses are expected to be below the £5m per annum threshold for which an impact assessment is required.  It should be noted that applications for exemptions are regularly made by trade associations on behalf of their members thus allowing the costs incurred to be spread across several companies operating in a given sector.  Successful applications are often made for up to 5 years (7 years for medical equipment) meaning that cost can be amortised across several years.

There are currently five exemptions for which a renewal application could in future be received and for which the application fee would be applied. In addition, the Secretary of State is considering 12 cases in relation to lamps that were submitted to the EU whilst the UK was a member state. If these are approved, then a further renewal could be sought in future. Since leaving the EU and the end of the Transition Period in January 2021 we have only received one application for a new exemption.  We therefore do not anticipate more than five or six applications a year.

Industry is already familiar with the existing legislation in this area and have already largely adjusted their products such that they no longer use the listed hazardous substances, or have already applied for any necessary exemptions. The current recast EU RoHS Directive was adopted some 10 years ago and industry has largely adapted to the substance restrictions.  Indeed, six of the restricted substances were covered by the original EU RoHS Directive adopted in 2002.  The scope of the recast EU RoHS Directive in 2012 was extended to medical equipment and industrial control and monitoring devices but those sectors have also largely responded to ensure equipment placed on the market now meets the requirements. Thus, we do not anticipate these changes will significantly change the behaviour or plans of companies in the affected sectors 

10. Please provide any further comments on the proposal to introduce a fee for processing applications for exemptions to the RoHS Regulations