Producer responsibility for take back of elvs:

  • who is responsible and who pays?


As many readers definitely will recall, EGARA during 2005 had several interventions and discussions about how Producer Responsibility, as outlined in the Directive, should be understood.

Our feeling is clearly that, according to the directive, the “rules” (with my bolding) are:

  • Member States shall take the necessary measures to ensure that producers meet all, or a significant part of, the costs of the implementation of this measure and/or take back end-of life vehicles free of charge for the last owner/keeper.

Therefore as we see it, there are two possibilities, which could co-exist, a view which is supported by the Commission in its interpretation document:

  1. The producers establish their own “free take back network” of authorised facilities
  2. The owner/keeper can deliver his elv to any authorised facility and if there should be costs involved in the treatment of the elv according to the directive, then the producers would have to cover these costs – if the elv has no or a negative market value.

Now, in 2006, solutions according to possibility 1 are underway. Producers have in a number of countries established or are the process of establishing such network, by signing contracts with ATFs, and as we can see it, all of them on the condition that the ATFs should guarantee to do this, at zero costs for the producers until 2015. A number of ATFs have signed such contracts in various countries.

Possibility 2 is also seen in some countries – but here there is also evidence that, it may even be allowed to charge the last owner! The logic behind this is, that if the producers have a reasonably “dense” network – say that an ATFs is within a distance of 50 km – then the last owner can go to a network node – but if he prefers to go “just around the corner to the nearest ATF”, then he could do so – but he should be prepared to pay for it!

In EGARA we do not believe that this is according to the “philosophy” of the Directive, and we will of course closely monitor what is happening, and, if necessary, bring the issue to legal interpretation at the highest European level.

We are also of the opinion that a guarantee for an ATF accepting elvs at zero costs until 2015, business wise is a dangerous solution. When, as now, scrap metal prices are high, then it may be possible – but what would happen if the market prices drop? And where is the point where it becomes a loss for an ATF?

So here we are back again with the “old” question: How much does it cost to treat an elv according to the rules and does an elv contain enough value to cover the costs?

Producers say: “Yes – always” – We say: “Perhaps – but none can guarantee it!”

In last years discussions between GM-Europe and us, there was a clear difference concerning how much time it takes to treat an elv. Following a constructive dialogue between us, it became evident, that we on our side had more work-items than GM counted for, e.g. things like: Checking ownership, writing CODs, reporting to authorities etc – all work items we have to undertake according to the rules. But does such work-items fall under producer responsibility? – And it is fair that producers should pay for this? Or do we really have a situation where some work falls under producer responsibility – some under authority responsibility? Evidently “yes” – according to the Commission’s legal service, whom EGARA contacted on this.

So here we are! After several years of discussion, we are still left with the main questions – and more have been added:

  • What does it cost to treat an elv according to the rules?
  • How do you calculate/estimate the market value of an elv?
  • If the elv has no or a negative market value, who will then pay us for our work?
  • Will it be possible to get authorities to pay their share of the costs? – and how, then?
  • Will it be allowed to charge the last owner/keeper – if you are not in a producer’s network?

And all of these questions should be answered and adequate mechanisms should be in place before 01.01.2007! And to find the answers – dialogue is necessary between us, producers and authorities.

EGARA will keep its eyes open and closely follow what happens – and wants a constructive dialogue opened. But if this should fail, we will of course, if necessary, make interventions to the Commission and national law makers!

More countries to join EGARA

Our Estonian colleagues who have been at EGARA-meetings as guest in the past two years, have now made a formal application to join EGARA and our colleagues in Lithuania are working on the subject and will probably make a formal application.

Recently, the Hungarian association GOE has been I contact concerning joining EGARA, and the secretary will have consultations with them in the beginning of April in Budapest.

Discussions on International Cooperation continue – In Las Vegas 16.-17.03.2006

As readers of the ARA Magazine perhaps will recall, a discussion concerning cooperation between Associations of Automotive Recyclers world-wide was initated during the EGARA-meeting in Brussels November 2006, where representatives for ARA, ARC –Canada and JARA- Japan were present.

Based on the idea that many of the problems we face in the different parts of the world are similar and even in some cases solutions are found in one country that could be implemented as well in other countries exist, and with a structured effort we could benefit from each others knowledge and competencies.

At the time of writing this article, I am in the process of getting my sit-case ready to leave to-morrow (14.03.06) for Las Vegas, where ARA, in conjunction with ARA’s Mid-Year Business Development Conference 13.-15.03.2006, has arranged an International Round Table is organised on 16.-17.03.06 where the next steps will be taken.

Common problems for us all, up for discussion at Las Vegas, are, amongst other items, things like: Air-bags, Salvage Acquisition, certification Systems and the hope is that we, together, can identify the key international issues and make a sort of an action plan for how to tackle them – jointly

I personally – and EGARA – do look forward not only to the meeting, but especially to the outcome of it. Together we are strong and we must join forces in order to tackle the problems of the industry!


Lennart Scharff