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The EU’s End-of-Life Vehicles Directive Revision: An Overview of the Latest Draft Proposal by Georg Mehlhart

Dr Georg Mehlhart has been running the consulting company Mehlhart Consulting since 2020 and has been advising the EU Commission on batteries, end-of-life vehicles and other topics for many years. Most recently, he played a leading role in assessing the impact of various policy options during the revision of the EU End-of-Life Vehicles Directive. The technical advisors were typically not involved in the final formulations of the draft of the new regulation.

 

The EU's End-of-Life Vehicles Directive Revision: An Overview of the Latest Draft Proposal by Georg Mehlhart soc
Dr Georg Mehlhart

The EU Commission’s draft to replace the EU end-of-life vehicle directive from 2000 is available.

On July 13, 2023, the EU Commission’s long-awaited draft for a complete rewrite of the regulations on end-of-life vehicles and the requirements for circularity of vehicle design was published.1 The draft is only available in English. The EU Parliament and the European Council will now consider this proposal. If you take the process of recasting the EU Battery Regulation as a basis, then it could well take two years until the EU legislators reach a compromise. The regulation will apply to the EU27 Member States plus the EEA countries Norway, Lichtenstein and Island.

This article cannot reflect all the details of the 83-page draft regulation. To introduce this, first, an overview of some relevant points. A little more background follows afterwards.

Points of particular importance:

  • As before, the regulation applies to cars and light commercial vehicles. Selected regulation articles should also apply to buses, trucks, trailers and light vehicles with type approval five years after it comes into force.
  • The revised definition of recycling, in conjunction with a yet-to-be-defined measuring point and corresponding loss rate for the recycled quantity, could make it more challenging to achieve recycling quotas in the future.
  • In order to reduce the problem of “statistical gap” / “missing vehicles”, a definition of a final list of conditions for deregistration is necessary. Furthermore, the definition of the term “temporary deregistration”, including the owner’s obligations that apply during this period, is necessary. However, this is to be done in a different legal package (“roadworthiness package”) and, therefore, cannot be evaluated here yet.
  • The requirements for type approval regarding recyclability should be redrafted in a legal act within three years and then be applicable for new type approval six years after the regulation comes into force.
  • Six years after it comes into force, 25% of plastics should consist of recycled “post-consumer recyclate” (PCR) upon type approval. 25% of the PCR should come from end-of-life vehicles.
  • Producers can fulfill their extended producer responsibilities either individually or as part of joint organizations. In the case of individual fulfillment, financial guarantees must be provided. In the case of collective fulfillment, the respective cost contributions should be “modulated” based on the individual costs.
  • It seems unclear whether the costs of treatment facilities not covered by revenue, which are borne by producers, relate to the total costs and revenues of the approved treatment facilities or whether the costs and revenues for individual prescribed processes should be taken into account.
  • The ban on landfilling non-mineral untreated shredder waste may require the construction of new post-shredder treatment facilities in some countries.
  • For exports to non-EU countries, a valid certificate of the roadworthiness of the vehicles must be presented in the future.

The EU's End-of-Life Vehicles Directive Revision: An Overview of the Latest Draft Proposal by Georg Mehlhart p

Legal basis

The new EU regulation should be based on Article 114 of the Treaty on the Functioning of the European Union. This means that Member States can only go beyond the provisions of the regulation under very strict conditions. Such a restriction was already controversial with the Battery Regulation. Therefore, at the initiative of the Member States, the legal basis for the Battery Regulation was expanded and now also partially refers to Article 192(1), which allows for further national requirements in the environmental sector. This may also be necessary for the new end-of-life vehicle regulations.

In Article 2, the scope of the regulation is expanded to include buses, trucks, trailers and light vehicles in classes L3e – L7e, including motorcycles. However, after a transition period of 5 years, only some elements of the treatment and reporting rules will take effect. It has not yet been determined whether further elements will also come into effect at a later date.

Article 3 defines the terms used. Among other things, the term “end-of-life vehicle” is now made mandatory in conjunction with Article 37 and Annex I. The definition for “recycling” now (finally) refers to the EU Waste Framework Directive, so that backfilling no longer falls under recycling, but use as road building materials in landfill construction can still fall under recycling.

Unfortunately, the final definitions of the conditions under which a “cancellation of registration” of a vehicle can take place are missing in this article. Regulations for owners during a temporary deregistration are not included in the draft regulation, too, but are only mentioned in a legally ineffective way in recital no. 86. The different regulations and implementation of these two points in the Member States are an important reason for the large gap in reporting on the final whereabouts of (old) vehicles. Instead, it has been announced that in the third quarter of 2023, these points will be presented in a draft to the Commission as part of the so-called “roadworthiness package” under the leadership of the Directorate General MOVE. It remains to be seen if this will cover the need to address the issue of missing vehicles.

Chapter II on circularity (Articles 4 – 7) sets out minimum requirements for reusability, recyclability and recoverability, which must be demonstrated within the scope of type approval. No later than three years after the regulation comes into force, the EU Commission will present a new calculation method, which will then replace the old RRR Directive 2005/64/EC.

The restrictions and exemptions for the use of lead, cadmium, mercury and hexavalent chromium in vehicles remain in place. However, the procedures for allowing exceptions will be revised.

Six years after it comes into force, new requirements for plastics will apply to type approval. Accordingly, the plastics should consist of 25% “post-consumer recycled material” (PCR), and 25% of the PCR should come from end-of-life vehicles. The calculation methodology for this should be set out in a legal act within two years. In addition, further targets for the recycled content of steel and aluminium, as well as selected critical raw materials, may be set in the future. At the same time, the design of new vehicles must not hinder the removal of parts and components with potential for reuse.

Chapter III (Articles 8 – 13) sets out the information and labeling requirements for producers. The documents required for type approval must then also contain a “strategy for circularity”. Furthermore, Article 11 lists the information that must be made available to authorized treatment facilities (ATFs). Article 12 describes marking standards, and Article 13 introduces the fundamental introduction of the digital circularity passport. However, the exact content of this digital passport and also the proportion of dynamic information (i.e. information that can change over the life of the vehicle) will only be determined in an announced legal act.

Chapter IV (Articles 14 – 36) covers the management of end-of-life vehicles. The draft regulation requires producers to implement an extended producer responsibility system (Articles 16 – 21). Producers can fulfill these obligations either individually or collectively in a Producer Responsibility Organization (PRO). Producers are obliged to cover costs that are not covered by revenue and that arise from legal regulations. However, it seems unclear whether these uncovered costs are calculated from the balance of all costs and income from the authorized treatment facilities or from the costs and income for individual mandatory tasks of the treatment facilities. If all costs remain with the treatment facilities, up to the point where all revenues were used up, this would certainly encourage illegal treatment. In the case of collective fulfillment, the producer’s respective cost contributions should be “modulated” based on the individual costs.

If the extended producer responsibility is fulfilled individually, producers must provide guarantees for the expected costs of extended producer responsibility. It is not entirely clear to what extent individual proof of obligations, e.g. recycling quotas, is explicitly required for the vehicles of this producer in the case of individual fulfillment.

In order to offset the effects of intra-European trade in used vehicles on the costs of producer responsibility, producers must also cover the additional costs in an EU Member State other than the one in which the vehicle was first put on the market (Article 22).

The requirements for the storage of end-of-life vehicles have only changed insignificantly. However, reporting requirements for pollutant removal have been added. The list of components to be removed has been supplemented. A derogation from the removal obligation is not possible for all of the components mentioned there. In order to equate post-shredding treatment with the removal of parts and components, a documentation requirement is now introduced (Article 30). Non-destructive removal for reuse is only necessary if there is appropriate reuse potential (Article 27). However, the Articles are apparently not entirely consistent, as Article 31 now requires that all parts that have to be removed must be checked for reusability. The fact that those who place used (replacement) parts on the market will now also have to prove the origin of these parts is likely to have a positive effect on legal businesses (Article 32). However, the corresponding internet platforms would also have to be included for implementation. Article 35 is just four lines long but could be important for many Member States. It introduces a ban on the landfilling of untreated, non-inert shredder residues within three years of coming into force.

Chapter V (Articles 37 to 45) regulates the export of used vehicles. It should be noted that the term export is only used for trade with countries outside the EU. Within the EU, however, we speak of intra-European trade. This intra-European trade in used vehicles is not restricted. For export, however, the draft proposes that export is tied to the existence of a valid certificate of roadworthiness. Currently, the vast majority of exported vehicles do not have this certificate. It remains to be seen whether the exporters will now seek such a certificate or instead acquire newer/roadworthy vehicles for export. In principle, however, it can be assumed that the quality of the exported vehicles is improving. Some authorized treatment facilities are also directly or indirectly involved in the export of used vehicles, and the new regulation may lead to a change in their revenue situation.

The regulations of the Waste Shipment Ordinance remain effective for cross-border trade in end-of-life vehicles.

Furthermore, this chapter also regulates the necessary digital data exchange between different authorities and possible regulations for taking into account the import criteria of recipient countries.

Chapter VI (Articles 46 – 49) on enforcement stipulates that at least 10% of authorized treatment facilities, workshops and other businesses that may deal with end-of-life vehicles, such as vehicle dealers, are inspected by the competent authorities. Unspecified inspections of used vehicle exports should also be carried out. This chapter also regulates cooperation with other Member States to implement the regulation and reporting obligations to the Commission.

https://eur-lex.europa.eu/legal-content

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