Electrical and Electronic Equipment Sold in the European Union Must Comply with New ROHS 2 Requirements: DG Environment Issues FAQs

In July 2012, the Directorate General for the Environment (DG Environment)¹ published draft guidance in the form of Frequently Asked Questions (FAQs) to help businesses understand the new provisions of Directive 2011/65/EU (ROHS 2) on the restriction of the use of certain hazardous substances in electrical and electronic equipment (EEE). Each Member State of the European Union (EU) is in the process of transposing ROHS 2 into national law, which must be accomplished by January 2, 2013.² The requirements of ROHS 2 take effect on January 2, 2013, and the original ROHS Directive 2002/95/EC will be repealed on January 3, 2013.

The purpose of ROHS 2 is to broaden the scope and reach of ROHS, improve legal clarity and certainty, harmonize the implementation of ROHS 2 within the different Member States, and align and harmonize ROHS with other EU legislation.³ The principal revisions include the following:

• Expansion of the covered categories of EEE⁴
• Clearer and more transparent exemption rules
• Application of CE marking and conformity assessment procedures
• Inclusion of a process for reviewing and amending the list of restricted substances

Broader Coverage of Electrical and Electronic Equipment

Beginning in 2014, the requirements of ROHS 2 will extend to products not previously covered by ROHS, and by July 23, 2019, the ROHS 2 requirements will apply to all EEE, except as specifically excluded. The deadlines for compliance are listed below:

• Beginning July 22, 2014, medical devices⁵ and monitoring control instruments must comply with ROHS 2.
• By July 22, 2016, in vitro diagnostic medical devices⁶ must comply.
• By July 22, 2017, industrial monitoring and control instruments⁷ must comply.
• By July 23, 2019, all EEE that previously was outside the scope of ROHS but is now within the scope of ROHS 2 must comply.

ROHS 2 broadens the definition of EEE by now including any equipment that needs electric currents or electromagnetic fields to fulfill at least one intended function. Previously, it was understood that "dependent" meant that only equipment that could not fulfill its basic or primary functions when the electric current was off would be covered—and further, that only equipment whose primary energy was electric would be covered.⁸ The FAQs explain that being dependent on electric currents or electrical fields means that such currents and fields pass through the electrical or electronic parts of the EEE to fulfill at least one function, and if the full functionality of the equipment would be impaired if the electrical function were to fail, the product is a covered product. Thus, a singing teddy bear, sports shoes with lights, and a gas cooker with an electric clock are all covered products that must meet the substance restrictions, but compact discs and optical cables are outside the scope of ROHS 2.

Products that were not previously within the scope of ROHS but are now covered products (because they are covered under the new category 11—defined as "other EEE not covered by any of the other categories"—or within the expanded definition of EEE) benefit from a gradual transition period that allows these products to continue to be sold on the EU market until July 22, 2019. The FAQs explain, however, that if these newly covered products are non-compliant, they cannot be made available on the EU market after this date even if they have been placed on the market before this date, and "the distribution chain within the EU must be clear of these non-compliant products" by July 23, 2019.

Exemptions Are Clarified

ROHS 2, Article 2(4), expands the list of exempt equipment and specifically excludes the following categories of equipment:

• Equipment necessary for the protection of the essential interests of the security of Member States, including arms, munitions, and war material intended for specifically military purposes⁹
• Equipment designed to be sent into space¹⁰
• Equipment specifically designed and installed as part of another type of equipment that is excluded or does not fall within the scope of ROHS 2, which can fulfill its function only if it is part of that equipment, and which can be replaced only by the same specifically designed equipment¹¹
• Large-scale stationary industrial tools¹²
• Large-scale fixed installations¹³
• Means of transport for persons or goods, excluding electric two-wheel vehicles that are not type-approved¹⁴
• Non-road mobile machinery made available exclusively for professional use¹⁵
• Active implantable medical devices¹⁶
• Photovoltaic panels intended to be used in a system that is designed, assembled, and installed by professionals for permanent use at a defined location to produce energy from solar light for public, commercial, industrial, and residential applications
• Equipment specifically designed solely for the purposes of research and development and only made available on a business-to-business basis¹⁷

ROHS 2 also establishes new exemption procedures. In addition to establishing categories of exempt EEE as outlined above, Annex III lists specific applications exempt from substance restrictions applicable to all EEE.¹⁸ Annex IV lists specific applications exempt from substance restrictions applicable to medical devices and monitoring and control instruments.¹⁹ Applications for exemptions, exemption renewals, and deletions can be submitted by a manufacturer, authorized representative of the manufacturer, or any economic operator in the supply chain. Annex V outlines the minimum application requirements and the European Commission's evaluation procedures. An application for an exemption renewal must be filed within 18 months before the exemption expires. Validity periods will be determined on a case-by-case basis for individual exemptions, but the maximum validity period for EEE exemptions is five years. The only exceptions are medical devices (category 8) and monitoring and control instruments (category 9), which both have maximum validity periods of seven years.

ROHS 2 Requires Compliance with CE Marking and Conformity Assessment Procedures

One of the most significant changes for manufacturers, importers, and distributors is that ROHS 2 includes CE marking requirements and conformity assessment procedures. Beginning on January 2, 2013, all EEE inside the scope of ROHS 2²⁰ must be affixed with a CE mark before the EEE is placed on the market. New EEE that comes within the scope of ROHS 2 (such as medical devices and monitoring and control instruments placed on the market starting on July 22, 2014) will be required to comply with all of the ROHS 2 requirements, including the CE marking and conformity assessment procedures. Equipment bearing the CE mark will be presumed to comply with ROHS 2. All of the economic operators (manufacturers, authorized representatives, importers, and distributors) have obligations to ensure compliance with the CE marking and conformity assessment procedures.

Manufacturers are required to draw up technical documentation and implement internal production control procedures necessitated by module A of Annex II to Decision No. 768/2008/EC,²¹ prepare a declaration of conformity (DoC),²² and assume full responsibility for ROHS 2 compliance. After it is demonstrated that the EEE complies with all applicable requirements, manufacturers must affix the CE mark on the finished product; ensure that the EEE bears a type, batch, or serial number allowing its identification; keep a register of non-conforming EEE and product recalls; and take immediate corrective measures to bring EEE into conformity or withdraw or recall it from the market if there is reason to believe that it is not in compliance with ROHS 2. When a manufacturer has reason to believe that it has placed EEE on the market that is not in compliance, the manufacturer must inform the competent national authority where the EEE is available that the product is not in compliance. Manufacturers can appoint an authorized representative to keep the DoC, respond to requests from a competent national authority, provide any information necessary to demonstrate conformity with ROHS 2, and cooperate with the authorities to ensure compliance.

Importers can only place EEE on the EU market that complies with ROHS 2. Before placing EEE on the market, importers must ensure that 1) the manufacturer has carried out appropriate conformity-assessment procedures and drawn up the technical documentation; 2) the EEE bears the CE mark and a type, batch, or serial number that allows its identification; 3) the EEE is accompanied by the required documents; and 4) the manufacturer keeps a register of non-conforming EEE. If the importer believes that the EEE is not in conformity with the ROHS 2 substance limits, the importer cannot place the EEE on the market until it is brought into conformity and the importer must inform the manufacturer and the authorities to that effect. Importers are required to indicate on the EEE or on the packaging their names and trademarks, as well as the addresses at which they can be located. If importers believe that EEE they have placed on the market is not in compliance with ROHS 2, the importers must take corrective measures immediately to bring the EEE into compliance or withdraw or recall the EEE.

Distributors are required to ensure that the EEE bears the CE mark, that it is accompanied by the required documents, and that the importer and manufacturer have complied with their requirements to indicate their names or trademarks on the EEE. If a distributor has reason to believe that the EEE is not in compliance, the distributor cannot make the EEE available on the market. If the distributor believes that it has made available EEE that is not in compliance, it must take corrective measures to bring the EEE into compliance or withdraw or recall the EEE.

Commission Must Review the Need to Amend the Scope of EEE and List of Restricted Substances

By July 22, 2014, the European Commission must examine the need to amend the scope of EEE that is covered under ROHS 2 and to review the list of restricted substances covered by ROHS 2. In reviewing the list of restricted substances, the European Commission is required to consider whether a substance²³ could 1) have a negative impact during EEE waste management operations, 2) give rise to an uncontrolled release of the substance into the environment, 3) lead to unacceptable worker exposures during waste EEE collection or treatment, or 4) be replaced by substitutes that have fewer negative effects.

If you have any questions about this new EU directive, please feel free to contact Kimberly McMorrow (kmcmorrow@wsgr.com or (650) 565-3520) in Wilson Sonsini Goodrich & Rosati's real estate and environmental practice.

¹ DG Environment is one of the 40 Directorates General that make up the European Commission. The FAQs reflect the views of DG Environment and are not legally binding. The FAQs are considered to be a "living document" that may be revised in the future.

² ROHS 2 requires Member States to take all measures necessary to ensure that their national provisions are implemented and to provide penalties for non-compliance that are effective, proportionate, and dissuasive.

³ FAQs, Q.1.1.

⁴ The original ROHS Directive defined the scope of ROHS-covered categories by reference to Annex 1.A of Directive 2002/96/EC on Waste Electrical and Electronic Equipment (WEEE), but the new ROHS 2 specifically lists 11 categories of covered equipment.

⁵ A "medical device" is defined as any medical device within the meaning of point (a) of Article 1(2) of Directive 93/42/EEC that is also EEE. ROHS 2, Article 3(21).

⁶ An "in vitro diagnostic medical device" refers to any in vitro diagnostic medical device within the meaning of point (b) of Article 1(2) of Directive 98/79/EC. ROHS 2, Article 3(22).

⁷ Industrial monitoring and control instruments are defined as "monitoring and control instruments designed for exclusively industrial or professional use." ROHS 2, Article 3(24).

⁸ The earlier ROHS FAQs, published in August 2006, explained that a teddy bear with a battery or a gas cooker with an electric clock were products outside the scope of ROHS because the electrical energy only was required for support or control functions, not primary functions.

⁹ The FAQs cite missiles and battlefield computers as examples. FAQs, Q.7.1.

¹⁰ The FAQs cite satellites and space probes as examples. FAQs, Q.7.1.

¹¹ The FAQs cite computers specifically built to be installed in aircraft as an example of exempt EEE. The FAQs further explain that if the equipment can be used for purposes within the ROHS 2 scope, the equipment is not exempt from ROHS 2. The exemption is for equipment that is "tailor made" or designed to meet the need of a specific application that is not covered or is exempt. Examples of equipment that must comply are standard electronic racking systems and other non-standard equipment intended to be fitted to an automobile, such as hands-free phone systems and satellite navigation devices. FAQs, Q.4.1.

¹² ROHS 2, Article 3(3), defines "large-scale industrial tools" as a large-scale assembly of machines, equipment, and/or components functioning together for a specific application, permanently installed and de-installed by professionals at a given place, and used and maintained by professionals in an industrial manufacturing facility or research and development facility. The FAQs cite as examples assembly cranes and machines for the industrial production and processing of materials and goods, such as assembly cranes or bridge-type milling and drilling machines, and other machinery of similar size and weight. Since the manufacturer, assembler, and user will bear the burden of proving that equipment is exempt, it would be prudent for individuals with questions to seek guidance from the competent authority in the Member State in which the equipment will be marketed. FAQs, Q.3.1.

¹³ "Large-scale fixed installations" are defined as a large-scale combination of several types of apparatus and, where applicable, other devices, which are assembled and installed by professionals, intended to be used permanently in a pre-defined and dedicated location, and de-installed by professionals. ROHS 2, Article 3(4). The FAQs provide the following examples of installations that meet this exemption: production and processing lines (including robots and machine tools); passenger lifts; and conveyor transport systems, automated storage systems, and large fixed-installation cooling, air conditioning, and refrigerating systems. FAQs, Q.3.1

¹⁴ The FAQs include the following products as examples of exempt equipment: cars, commercial vehicles, and aircraft. FAQs, Q.7.1.

¹⁵ This exclusion is defined as "machinery with an on-board power source, the operation of which requires either mobility or continuous or semi-continuous movement between a succession of fixed working locations while working and is made available exclusively for professional use." ROHS 2, Article 3(28). Examples include hydraulic excavators, forklifts, and road-maintenance equipment. FAQs, Q7.1.

¹⁶ ROHS 2 defines an "active implantable medical device" as any active implantable medical device within the meaning of point (c) of Article 1(2) of Council Directive 90/385/EEC of June 20, 1990, on the approximation of the laws of the Member States relating to active implantable medical devices. ROHS 2, Article 3(23).

¹⁷ The FAQs explain that this exclusion applies only to specialized EEE that is custom-built solely for specific research and development (R&D) applications and not to "standard equipment such as monitoring devices" or other instruments that can be used both for R&D applications and in commercial and other applications. FAQs, Q4.2. The exclusion is not meant to exclude category 9 equipment used to test, validate, or monitor R&D equipment. Examples of equipment that would benefit from this exclusion include non-finished products, such as prototype or sample/test EEE, and "in-house custom built 'development vehicles' used solely for development, test, validation, and evaluation of such non-finished products." FAQs, Q4.2.

¹⁸ Exemption 7(b), for example, applies to lead-in solders for servers; storage and storage array systems; and network infrastructure equipment for switching, signaling, transmission, and network management for telecommunications.

¹⁹ Exemption 1, for example, applies to lead, cadmium, and mercury in detectors for ionizing radiation.

²⁰ The FAQs explain that EEE that was not within the scope of ROHS but is within the scope of ROHS 2 (i.e., category 11) will not require CE marking or a DoC until July 23, 2019. FAQs, Q.9.7.

²¹ Decision No. 768/2008/EC provides a common framework for the marketing of products in the EU, including the application of CE. Annex II requires the technical documentation to include the following, "wherever applicable": 1) general description of the product; 2) conceptual design and manufacturing drawings and schemes; and 3) harmonized standards applied and/or relevant technical specifications, along with test reports. The European Committee for Electrotechnical Standardisation (CENELEC) has produced a draft standard on the technical documentation required by ROHS 2—EN 50581:2012, which expands on the requirements in 768/2008/EC.

²² The DoC must contain the information required by Annex VI of ROHS 2 and it must be translated into the languages required by the Member State in the market in which the product is placed. The manufacturer must keep the technical documentation and the EU DoC for 10 years after the EEE has been placed on the market. ROHS 2, Article 7(d).

²³ ROHS 2 clarifies that even substances of a very small size or with a very small internal or surface structure (i.e., nanomaterials) should be considered.