April 2010 SMTA Nutmeg Chapter

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An update on the latest information available for China RoHS, as well as information and tips on surviving a product eco-compliance audit.

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April 2010 SMTA Nutmeg Chapter

  1. 1. China RoHS Update & Tips for  Product Eco‐Compliance Nutmeg Chapter SMTA 20 April 2010 Presenter:  Krista Botsford, Founder & CCO Botsford EcoTech Partners LLC © 2010 Botsford EcoTech Partners LLC All Rights Reserved
  2. 2. Keeping markets open … and CEOs out of Jail For over 5 years, Botsford has been in the business of keeping CEOs out of jail. We help them understand environmental laws impacting the goods they manufacturer. Non-compliance to these laws puts revenue streams at risk which directly impacts shareholder value. Botsford EcoTech Partners provides a leading-edge web- based tool to assist in product environmental compliance . Through ELM, companies are enabled and empowered to quickly bring their companies and products into compliance with the product environmental compliance laws. © 2010 Botsford EcoTech Partners LLC All Rights Reserved
  3. 3. General Trends for Product Eco‐Tech • Increased product environmental regulation – Design: labeling for hazardous materials, restriction of  materials – Use: energy, safety, life‐cycle – Packaging: included in most regulations – Recycling: increasing producer responsibility, growing  pressure to classify electrical and electronic equipment as  “hazardous” © 2010 Botsford EcoTech Partners LLC All Rights Reserved
  4. 4. China RoHS History February 28, 2006 March 1, 2007 China RoHS Regulation promulgated China RoHS regulation effective date (representing  March 16, 2006 implementation date for labeling and information  Electronic Information Product (EIP) List issued  disclosure aspects). (scope of EIP within purview of Art. 3(1) of the  October 9, 2008 China RoHS regulation) China RoHS Catalogue Procedures document issued,  June 22, 2006 laying out procedures and criteria for selection of  Framework measures issued to establish testing  EIP for inclusion in the Catalogue. EIP in the  and certification program aimed at establishing  Catalogue subject to materials restriction and  conformity with EU RoHS  concentration limits for  associated pre‐market certification Requirements. Chinese products exported to the EU. October 9, 2009 November 6, 2006 China RoHS draft Catalogue, first batch, issued for  Labeling, Concentration Limit, and Test Method  comment (deadline for public comment – Nov. 9,  standards issued to facilitate implementation of key  2009). aspects of the China RoHS regulation. November 9, 2009 December 2006 and February 2007 Public comment period ended. MIIT comment  Frequently Asked Questions (FAQ) Documents  review period begins. issued, then amended, to address questions related  November 17, 2009 to the China RoHS regulation and associated  China RoHS EPUP Guidelines and Lead‐free  implementing standards. Standards (technical/voluntary measures)  Promulgated. January 2010 Proposed Voluntary RoHS component certification  program finalized (not yet launched/promulgated) © 2010 Botsford EcoTech Partners LLC All Rights Reserved
  5. 5. China RoHS Passed: 2006   Phase 1: March 2007 “Management Methods for Controlling Pollution Caused by Electronic  Information Products Regulation” OR AND NO DISCLOSURE TABLE Products not labeled with Disclosure Information for  Restricted Hazardous Substances © 2010 Botsford EcoTech Partners LLC All Rights Reserved
  6. 6. China RoHS Passed: 2006   Phase 1: March 2007 “Management Methods for Controlling Pollution Caused by Electronic  Information Products Regulation” OR AND DISCLOSURE TABLE Products with Marking and Disclosure Information allowed for sale into and within China © 2010 Botsford EcoTech Partners LLC All Rights Reserved
  7. 7. China RoHS Categories • Radar Equipment and Products • Communications Equipment and Products • Broadcast and Television Equipment Industry Products • Computer Industry Products • Household Electronics Products • Electronic Measuring Instrument Products • Electronic Industry Dedicated Equipment and Products • Electronic Element Products • Electronic Device Industry • Electronic Application Products • Electronic Dedicated Material Products © 2010 Botsford EcoTech Partners LLC All Rights Reserved
  8. 8. China RoHS Product Differences from EU RoHS • Radar Systems • Medical Products • Large or Medium‐scale computer work stations (servers) • Networking infrastructure products • Consumable materials associated with EIP – Floppy disks, CDs, ink cartridges, video tapes, etc • Electronic components and its parts sold in direct markets – Capacitor: foil paper, dielectric, ceramic, etc. • Upgrades, spare parts sold directly to consumer © 2010 Botsford EcoTech Partners LLC All Rights Reserved
  9. 9. China RoHS Sample E‐PUP Logos • Logo 1 implies no hazardous materials at or above  Logo 1 maximum concentration levels as listed in SJ/T  11363‐2006 – Recommended color: Green • Logo 2 implies hazardous materials over the  maximum concentration levels as listed in SJ/T  11363‐2006 Logo 2 – Contrasting color with product – Orange is only a recommended color • Number in Logo 2 is the Environmental Protection  Use Period (E‐PUP) • Must be placed on product © 2010 Botsford EcoTech Partners LLC All Rights Reserved
  10. 10. China RoHS Environmental Protection Use Period • Abbreviated: E‐PUP • The term during which toxic or hazardous substances or elements  contained in electronic information products will not leak out or mutate • No technical or application exemptions – Exemptions handled by items published in the Product Catalog • Two methods of determining E‐PUP: – Technical Methodology • Practical • Experimental – Conceptual Methodology • Safe Use Period • Technology Life Method © 2010 Botsford EcoTech Partners LLC All Rights Reserved
  11. 11. China RoHS Disclosure Table • Simplified Chinese • X – substance is presence • O – substance is not present • Part – company decision:  – examples: part level; sub‐assembly;  • Required for parts with concentration levels above restricted levels (e.g.  must also have environmentally‐friendly use period mark) © 2010 Botsford EcoTech Partners LLC All Rights Reserved
  12. 12. China RoHS EiP Table EIP Category Definition EIP‐A Each homogeneous material composing EIP EIP‐B Metallic Coating of each part in EIP EIP‐C Small components or materials that cannot be further disassembled under existing conditions in EIP. Generally parts which are equal to or less than 4 mm3 in size. EIP Category Definition EIP‐A Shall not exceed 0.1% for Pb, Hg, Cr6, PBB, PBDE; 0.01% for  Cd. EIP‐B Pb, Hg, Cd, Cr‐6 cannot be intentionally added EIP‐C Shall not exceed 0.1% for Pb, Hg, Cr6, PBB, PBDE; 0.01% for  Cd. © 2010 Botsford EcoTech Partners LLC All Rights Reserved
  13. 13. China RoHS Phase 2 Promulgation: TBD • Only products within published catalogue – Catalogue yet to be published  • draft available Dec 2009 – No estimated date for publication • Testing and certification by an authorized Chinese  laboratory – This is being heavily worked on by lobbying groups and  industry groups © 2010 Botsford EcoTech Partners LLC All Rights Reserved
  14. 14. China RoHS ‐ Materials restriction and associated,  compulsory pre‐market certification under “Phase II” Key agencies: (Ministry of Industry and Information  Technology (“MIIT”) and the Certification and Accreditation  Administration (“CNCA”, under Administration for Quality  Supervision, Inspection and Quarantine) – Delays in finalizing the program continue as key agencies undertook  internal “consultations” relating to overall approach and details  concerning China RoHS Catalogue and associated certification program. – Certification program compulsory (per Article 19 of China RoHS  regulation). Model for CNCA China RoHS certification are the existing  China Compulsory Certification (“CCC” or “3C”) safety licensing  certification programs, with “some modifications possible”. – Current list of restricted substances (same as EU): Lead, Mercury,  Cadmium, Hexavalent chromium, Polybrominated biphenyl (PBB), and  Polybrominated diphenyl ether (PBDE), – Testing methods: “Testing Methods for Regulated Substances in Electronic  Information Products” must be used, also a Chinese government  approved/certified Lab must be used for testing. © 2010 Botsford EcoTech Partners LLC From TechAmerica presentation by  All Rights Reserved Heather Bowman
  15. 15. China RoHS  ‐ Industry Concerns • Finalization of First Batch of China RoHS Catalogue – Necessity of adding in missing exemptions for the proposed product  categories, importance of using language/exemption listings that are  consistent (in wording and numbering) with those used in the EU RoHS  program, to minimize company compliance clarity and system  changes. (example: repair parts.) – China’s willingness to consider “positive” (i.e., listed) exemptions, as  opposed to an earlier approach of indicating “if it is not specifically  listed it is not covered” (i.e., “negative exemption” approach),  represents months of industry exchanges with MIIT and MIIT technical  advisors on these issues. – MIIT’s reluctance to move toward a “positive” exemption approach  also reflects the political difficulties associated with Chinese agencies  taking up what may be perceived as “following another legal program”  (in this case, the EU program). This reluctance may again manifest as  industry attempts to make the exemptions consistent with the EU  exemptions as they currently exist. © 2010 Botsford EcoTech Partners LLC From TechAmerica presentation by  All Rights Reserved Heather Bowman
  16. 16. China RoHS  ‐ Next Steps • WTO TBT Committee notification of draft Catalogue, first batch. Possible any day,  as MIIT has met other authorities and reached agreement to notify WTO. • Comment period, based on China past notifications, is typically 60 days from  notification to the TBT Committee. – So, for instance, if the Catalogue is notified on July 15, WTO members would have until mid  September 2010 for comment. – China typically finalizes notified laws very promptly after the WTO comment period ends. • If finalized (promulgated) by, end of September 2010, you would count 10  months until the effective date, if the timing indicated in the current draft  Catalogue does not change (so, summer 2011). • The “upgrading” of the China RoHS framework regulation to a State Council regulation (from  an MIIT regulation) and possibly also the upgrading of the three key China RoHS standards  (i.e., labeling, concentration limit, and testing) to national (GB) standards, presents a very  significant future challenge for our industry. • Current estimates are that this will not occur for 2‐3 years. This presents a possible 1‐2 year  gap (or breather) between finalization of the substance restriction/certification “phase 2” of  the China RoHS program and “opening up” the entire program (phases 1 and 2) to further  changes, including possible massive scope changes. © 2010 Botsford EcoTech Partners LLC From TechAmerica presentation by  All Rights Reserved Heather Bowman
  17. 17. China RoHS Update/Outlook • Waiting to for publication of catalogue – No known date • When published, expect a 9‐month implementation  period © 2010 Botsford EcoTech Partners LLC All Rights Reserved
  18. 18. Background ‐ Government • RoHS Enforcement Audits ongoing since 2006 – Some audits are objective, others subjective • Nearly 50% of audits fail. • Mistakes  are common  – Largest areas of non‐compliance was use of non‐ compliance parts and processes. • Product removals happen • Member states expanding information sharing. © 2010 Botsford EcoTech Partners LLC All Rights Reserved
  19. 19. Background ‐ Corporate • Audits pre‐date government – Requirements exceed legal mandates  • Nearly 100% of audits fail • Impact varies – Revenue recognition – Inability to process RFP – Hold on purchasing of products – Inability to ship products • Mistakes are common across industries and  companies. © 2010 Botsford EcoTech Partners LLC All Rights Reserved
  20. 20. Common Mis‐Steps • Information delivered generates more questions than answers • Responsiveness – Not in a timely manner – Incomplete materials/ information • Reliant only on documents – Provide only CoC or  disclosures statements – Missing: • 3rd party audits • risk assessments • policies and procedures • Assumption of “too small to be of concern” – “No‐Name” brands or re‐branded items considered very high concern © 2010 Botsford EcoTech Partners LLC All Rights Reserved
  21. 21. Implementing a “Auditable” Program • Instrumentation of the program – Cross functional • Risk evaluation – Supplier, manufacturers,  • Metrics gathering – Internal/external auditing, supplier audits • Evaluation of tools – Software, news & data, audits • Self‐evaluation criteria – Who is in charge? – Will TCF stand alone – or is interpertation needed? © 2010 Botsford EcoTech Partners LLC All Rights Reserved
  22. 22. Tips on Surviving an Audit • Assume nothing – Auditor will not familiar with your company or products • Be responsive – Provide information in a timely manner – Provide complete technical compliance file; not just  materials information • Prepare for/Anticipate questions © 2010 Botsford EcoTech Partners LLC All Rights Reserved
  23. 23. Conclusions • Eco‐compliance is a product feature – It should be tested – Avoid having your customer find this bug • Understand corporate risk – Independent assessments are key • Develop a process‐based approach © 2010 Botsford EcoTech Partners LLC All Rights Reserved
  24. 24. How Botsford EcoTech Can Help • Complementary Risk assessments • In‐depth Supplier/supply chain audits • RoHS‐CE unit creation  – 3rd party info verification for CE mark • Total solutions for product environmental  compliance  – Managed services – Cost‐effective, customer/self‐driven solutions © 2010 Botsford EcoTech Partners LLC All Rights Reserved
  25. 25. Questions? Krista Botsford Founder, Chief Compliance Officer Mobile Office: 781.552.9585 E-mail: kbots@botsfordeco.com Skype: kbotsford © 2010 Botsford EcoTech Partners LLC All Rights Reserved

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