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News Article

Warning on environment law

Concerns that UK industry is not responding effectively to new European environmental measures has led the UK government departments of Trade and Industry (DTI) and Environment, Food and Rural Affairs (DEFRA) to issue two new guidance documents to the chief executives of every UK company in the electrical/electronics sector.
Concerns that UK industry is not responding effectively to new European environmental measures has led the UK government departments of Trade and Industry (DTI) and Environment, Food and Rural Affairs (DEFRA) to issue two new guidance documents to the chief executives of every UK company in the electrical/electronics sector.

The documents specifically address the challenges of the Waste Electrical and Electronic Equipment (WEEE) and Restriction Of use of certain Hazardous Substances (ROHS) directives. One of the guides is an overview for managing directors on the business actions required and the other a supporting document to alert marketing executives and designers to the challenges. An in-depth design guide will also be launched early in the New Year, backed by a major design conference and workshop in London.

"Most companies see these directives as an item of legislation that requires only an environmental response, when in fact they also have serious financial, marketing and design implications," says Dr Martin Gibson, programme director of the Enivrowise support and advisory service. "Many firms believe it’s not relevant to them for some years to come, but that simply isn’t true. The ROHS legislation becomes law in nine months and WEEE becomes effective 12 months later. Companies who wait until then to take action will be far too late."

Because of the requirements for product compliance, the cost of re-design and payment for compulsory industry-wide recycling arrangements, failure by companies to address the issues could have a knock-on effect throughout the supply chain with a far-reaching financial impact on the whole sector.

It is estimated that the future costs of the EC legislation to the UK economy could be as much as £455mn a year for WEEE and £200mn a year for ROHS. This will lead to an average cost increase of 1-2% for many products and as much as 3-4% for some larger or more complex products. Apathy could fuel even greater cost increases and render many UK companies uncompetitive. Some may even find that their products are banned from sale.

Gibson adds: "With many smaller electrical/electronics companies struggling to survive on profit margins that are little more than the cost of these increases, companies could find themselves sitting on a time bomb that they are too late to respond to. The longer they delay before taking action, the more costly it is going to be. Many companies, especially small ones, could go out of business unless they start to take action now."

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