As the EU approaches the final stages of reforming its End-of-Life Vehicles (ELV) regulation, an unexpected court ruling has shaken the automotive and recycling sectors. Olivier François, President of the European Recycling Industries Confederation (EuRIC), shares his insights on the regulatory overhaul and the implications of the recent €458 million fine against carmakers for anti-recycling practices.
After 2 years of intense internal discussions, the EU is now close to complete the new ELV “regulation” designed to recast the initial ELV “directive” of 2000: a vote of the EU Parliament is expected in June, and the Trilogue involving the Council and the Commission should complete the work by the end of this year. As one can imagine, lobbying actions are very busy at this moment.
Quite unexpectedly, a legal “bomb” exploded on the first of April: EU fines carmakers €458 million for anti-recycling cartel during the years 2002-2027.
We were stunned and concerned to learn of this ruling by the European courts. This is a major event that will leave a lasting mark on the reputation of carmakers, who have already been hard hit by the “Dieselgate” affair. Carmakers are not our enemies, but our partners, and there is nothing to celebrate about this new case: it will weaken the entire automotive industry. As with Dieselgate, we can fear that the authorities will use this event to marginalize manufacturers and take radical decisions without dialogue. At EuRIC, we are doing everything we can to ensure that the European voice of recycling is heard, particularly advocating that recycling competitiveness is paramount. Our competitiveness is the only way to ensure that end-of-life vehicles remain attractive to the legal sector.
Unfortunately, this is something that the authorities do not understand, as they are constantly asking us to spend more on our activities without weighing up the consequences. At least on this issue, the car manufacturers (ACEA) were very much in line with us. There is every reason to fear that their condemnation, and a condemnation precisely on the subject of financing recycling, will lead to a sudden deafness on the part of the authorities, and that we will be dragged into an escalation of expenditure (compulsory dismantling, administrative constraints, legal uncertainties, fines, etc.), in the style of “the manufacturers will pay”. Which is ridiculous: we know in France, after 30 years of many EPR experiences, that the adjustment variable at the end of the day is us, the recycling industry.
Which brings me to the other point that needs to be raised in this case of condemnation: it is the risk of “abuse of a dominant position” that still hangs over the EPR’s principle. EuRIC is well placed to observe the major differences in the way this principle is applied in the various 27 European countries. The spectrum is quite wide, from Belgium with FEBELAUTO, an EPR that is particularly respectful of the various stakeholders involved in the decision-making process, to the other extreme, the ‘French EPR design’, which is a combination of centralization and verticality. It is particularly interesting to see that this principle of EPR, devised by the OECD in the 1980s, once examined in the light of each country’s culture, produces extremely different results: “Jacobin” France concentrates all the powers in a single hand, that of the manufacturers/marketers, whereas countries with a “Girondin”/federal tradition place a great deal of emphasis on the principle of subsidiarity for the various players in the sector.
Every cloud has a silver lining: my hope is that this conviction will finally bring home to some national and European authorities the reminder that power concentrated in one hand is never good.
