Background
The Commission’s initiative to update the legislative framework for batteries in the EU builds on the Circular Economy Action Plan to make the EU’s economy more sustainable. The new law in the shape of a Proposed Regulation includes requirements on sustainability, safety and labelling, as well as requirements for the collection, treatment and recycling of waste batteries.
Our perspective
We work closely with many of the world’s leading technology, telecoms and consumer product manufacturers based in the EU and around the world. We help to ensure their compliance obligations are met and managed effectively, both as end-users of batteries and suppliers of products containing batteries. We routinely receive queries about how the current Directive 2006/66/EC (the “Batteries Directive”) applies to product companies’ operations, what some of the technical terminology used in means in practice, how the Batteries Directive and its national implementing legislation should be interpreted and how the existing regulatory framework for batteries applies to products and the supply chain. The Proposed Regulation provides an opportunity for clarity. We contributed to the recent consultation on the Proposed Regulation in early 2021 and highlight below some of the significant changes the new Batteries law will introduce across the EU for products companies.
Battery Passports: Impact on commercially sensitive information?
The Proposed Regulation includes the concept of “battery passports”, in order to help economic operators to make informed decisions and strategically plan their battery needs. The aim is to increase transparency and improve traceability of batteries. That said, the information laid down in Annex XIII of the Proposed Regulation is wide-reaching. Much of that information may be considered commercially sensitive in some business sectors. Potentially, a more limited data disclosure could also fulfil the aim of moving towards the sustainability goal, while better reflecting important commercial realities for business.
End of life arrangements
Under the Proposed Regulation, the Commission aims to target and re-enforce producer responsibilities. The underlying message is a laser focus on transparency in the chain of disposal at end of life. The Proposed Regulation discusses the establishment of a network of collection points for different battery categories, with costs to be borne by producers. Alternative financing arrangements are expressly permitted under the current Batteries Directive for industrial batteries, whilst the position is silent for portable batteries. We have seen this lead to a varied landscape across the EU, with some regulators interpreting the Directive (and their national implementing legislation) so as to permit such arrangements to cover portable batteries, and others not. The position is more nuanced under the Proposed Regulation. Whilst it may be premature to signal the end of “AFAs” as we know them, the strong message is that the Commission wishes to increase transparency in the battery supply chain, and the conclusion of private agreements could be viewed as contrary to this purpose. We monitor any updates in this space with interest.
Increased responsibilities for portable batteries
The Commission seeks to improve collection and recycling of all batteries across the EU, but for now notably for portable batteries. Where a consumer goods manufacturer supplies batteries to consumers for the first time (this could be in the appliance or separately in the box), under this new law they could become a portable battery producer. This brings a raft of ‘producer’ obligations at end of life. Under the Proposed Regulation, manufacturers will also need to ensure that any batteries incorporated into their appliances are “readily replaceable” which means that a battery can, after its removal, be substituted for a similar battery without the appliance functionality being affected. This could require considerable design changes for many manufacturers placing small electronic goods on the market, notably at lower price points, where we see batteries either completely sealed or not possible to safely replace. Button cells (coin batteries) are commonly incorporated into small appliances, and do not appear to be exempted from these new portable battery requirements. Indeed, the ubiquity of these small batteries could be viewed as one reason why the Proposed Regulation is intended to capture them. By strengthening requirements around portable batteries, the Commission hopes that far fewer will end up in landfill.
Where next?
We have picked out some of the potential key impacts of the Proposed Regulation. At present there is no “fixed date” for an updated draft of the Proposed Regulation. Further amendments will not be made by the European Commission but by the European Parliament and Council. Although the Proposed Regulation could be implemented by the start of 2022, based on average legislative proposal timescales this appears to be ambitious, and it may not be implemented until the end of 2022. However, we know that sustainability related measures are EU priorities (in order for the EU to meet its ambitious targets in this area), and so this legislation may progress faster than the usual timeframe. We will keep you up to date – look out for a more detailed analysis of the Batteries Regulation once the draft law is finalised!
Authored by Valerie Kenyon and Lucy Ward.
