1

Professor K.B. Chan

Chairman, Hong Kong Electronic Industries Association

November 2007

Green Manufacturing

Update on China ROHS & Korea ROHS Regulations

2

World Electronics Industry

• US$1.5 trillion economy, 6.9% growth (2006)

• Asia - growth engine (> 50% share incl. Japan)

• Slower growth in Europe & Americas

Source: Reed Research, 10/2006

US$ Billion 2003 2004 2005 2006 CAGR

Europe 245 269 275 281 4.6%

Americas 312 342 360 380 6.8%

Asia 584 694 763 835 12.6%

Rest of World 14.3 16.2 17 17.8 7.6%

World 1,156 1,321 1,416 1,513 9.4%

Electronics Production

3Source: Reed Research, 10/2006

China - World Electronics Factory

• 20% of world output

• Growth doubles world average

• Largest markets of handset, DVD, TV

• Emerging markets: automotive electronics

US$ Billion 2003 2004 2005 2006 CAGR

China 161 213 260 302 23.2%

World 1,156 1,321 1,416 1,513 9.4%

China’s World % 14% 16.1% 18.4% 20% --

Electronics Production

4

Top 5 Economies

China

• 10.7% GDP growth in 2006

• 2007 Q1-Q3: 11.5% growth

• Foreign Exchange Reserve = US$ 1.4 tril (Sep 07)

Source: Gov’t news, Commercial news, IMF

Economy2006 GDP

(US$ Trillion)

US 13.2

Japan 4.4

Germany 2.9

China 2.7

Britain 2.4

5Source: Reed Research

Top 7 Asian Electronics Producing Countries

China

Japan

MalaysiaSingapore

South Korea

TaiwanThailand

0

50

100

150

200

250

300

350

2003 2004 2005 2006

US

$ B

6

California:Recycling (2005) with RoHS (2007)

EU: WEEE & RoHS (2005 & 2006)

EU: EuP (2007)

EU: REACH (2007)

China: • RoHS (2007)• WEEE (under

preparation)

Japan:• Recycling Law

(2001)• RoHS labeling

(2006)

RoHS (Pending)

Australia, Taiwan, Argentina, Brazil...

Korea: RoHS/WEEE (Jan 1, 08)

7

China RoHS

“Administration on the Control of Pollution Caused by Electronic Information Products”

《電子信息產品污染控制管理辦法》 :

• Effective March 1, 2007

• Apply to products manufactured in, sold in or imported into China (export products not applied)

• Same 6 substances as in European RoHS

For Details:

http://www.mii.gov.cn/art/2005/12/17/art_525_1786.html

8

Executed by 7 Government Departments

• Ministry of Information Industry

• National Development and Reform Commission

• Ministry of Commerce

• General Administration of Customs

• General Administration of Industry and Commerce

• General Administration of Quality Supervision, Inspection and Quarantine

• State Environmental Protection Administration

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• Computer

• Telecommunication

• Household Electronic

• Special Electronics Apparatus

• Radar & Broadcast

• Electronic Measuring

• Components and Materials

• Application Products

Product Coverage

Following Electronic Information Products (EIP) & their accessories:

Over 1,800 items, for details: http://www.mii.gov.cn/art/2006/03/16/art_1221_8441.html

10

Major Requirements

1. Labeling / Marking

Hazardous substances and contents

Environmentally friendly use period*

Packaging materials

2. Restrictions on 6 hazardous substances:

Same as European RoHs

1. Compulsory pre-market certification - China Compulsory Certification (CCC) - tested by one of the gov’t-approved Chinese laboratories* Environmentally friendly use period = # of year from

manufacturing date in which no hazardous substance is released to the environment

11

Two Phases of Implementation

• Phase 1: Labeling / Marking for Products

• Phase 2: Products listed in “Key Product Catalogue” need to comply with requirements:

Hazardous substances limits

Certification (CCC)

Chinese Government is drafting the “Key Product

Catalogue” (not yet available - expected end 2007 /

early 2008)

12

China RoHS Working Group

• Established in Oct 2004, with 5 sub-working units:

Certification & marking

Maximum concentration limits & testing

Lead-free soldering

Standard system study

Environmentally Friendly Use Period

• ~120 members, SMT is one of them

• Consultation and voting rights

13

Consequences of Non Compliance

• Enforcement by 7 Departments - complicated

• Penalties and fines

• More rules

• No details yet

14

Important Notes

• Pay attention to China RoHS details & developments (e.g. Key Product Catalogue 重點管理目錄 )

• Consult relevant departments regarding testing & certification

• Prepare labels, and Chinese translations for documents (substance disclosure table, operating parameters for Environmentally Friendly Use Period)

15

• Korea RoHS - titled “Act for Resource Recycling of Electrical and Electronic Equipment and Vehicle”

• Includes key regulatory actions of the EU directives RoHS, WEEE and ELV

• Effective January 1, 2008

Regulations in Korea

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I. Target products & restricted substances:

• 10 target product items (e.g. TVs, refrigerators)

• 6 restricted substances (same as EU RoHS)

II. Design for recyclability and recycling information:

• All manufacturers and importers to provide their Electronic and Vehicle Recycle information (product name, year of production, disassembly procedure...)

• Vehicle's ratio of recyclable contents will be over 85% in 2009, over 95% after 2010

Korean Requirements

17

III. End-of-life recycling system:

• 4 hazardous substances will be banned in vehicles (same as EU ELV)

Korean Requirements

18

RoHS EU China Japan Korea

Restricted Materials

6 materials Same Same but info. only

Same

Effective July 1, 06 Mar 1, 07 July 1, 06 Jan 1, 08

Scope 8 categories (10 for WEEE)

Long list (incl. capital equipment)

7 home app. & computer products

10 Target items

Exemption Defined Catalog Not applicable

undecided

Marking Req.

None Yes Yes Yes

Packaging Materials

No impact Non-toxic / recyclable

None Yes

Testing/ Certificat-ion

No prerequisite

China Compulsory Certification

No prerequisite

Yes

19

• A non profit making organization supported by manufacturing and trade associations

• Alliance formed Dec 2004

• Founding Honourary Chairman: Prof. KB Chan

• Secretariat: Federation of Hong Kong Industries

• Steering committee – holds regular meeting

• Government support

HK Industry’s Response: Hong Kong Green Manufacturing Alliance (HKGMA)

20

Founding Members

• 7 Trade Associations related to Electronics, Electrical, Toys and Watches Industries

Advisors

• Hong Kong Productivity Council

• Hong Kong Trade Development Council

• 6 universities in Hong Kong

Observer

• Innovation and Technology Commission, HK Government

21

Mission

• To facilitate the transformation of HK manufacturing industry into “Green”

Activities (2005 - Oct 2007) – on RoHs WEEE

• Raise awareness: seminars, promotions

• Provide guidelines for compliance: workshops

• Technology advancement: R&D, database

• Industry representation: liaise with government

• Platform for networking: domestic and international

Organized ~40 events > 5,000 participants

22

Activities 2007 onwards

• Apply same action of promotion & awareness on

China RoHs

EuP

REACH – full funding programs from HK Government

• Promote Green Q-Mark for FHKI

Recognition of enterprise with Green Manufacturing practice

23

• World electronics industry is growing at a steady pace, China taking a dominant position

• China is trying to improve its economic condition, with focuses on R&D, high tech and environment (target industries: e.g. electronics, automotive)

• Meanwhile, environmental laws around the world are greatly affecting the electronics & other industries (many technical issues still unsolved)

• Drafting standard industry guidelines for RoHS based on EU laws (agreed in WEF/APEC Seminar - June 2007) is a good start

Summary

24

Let’s Join Together for a Better Electronics Industry!

Thank You!