Here are the top 5 things businesses need to know about RoHS in 2011.  And first, an overview of the RoHS directive.

RoHS overview

As of July 1, 2006, producers and importers of electrical and electronic equipment (EEE) in the European Union (EU) must adhere to the Restriction of the Use of Certain Hazardous Substances in Electrical and Electronic Equipment Regulations (RoHS).

RoHS is a directive, not a regulation.  The difference is that a directive cares only about the result.  With RoHS, for example, the required result is the restricted use of certain toxic chemicals in electronics manufacturing.  How businesses achieve that result, or how member states handle governing that process, is up to each.

A regulation, on the other hand, delineates to each affected entity how to manage compliance with the law.  A good example of a regulation is the REACH regulation, which has a detailed process for substance registration, use, and data sharing.

RoHS restricts — and in some cases bans — the use of certain hazardous substances above a specified amount in the manufacture of electronics.  The key hazardous substances under RoHS are lead, cadmium, mercury, hexavalent chromium, as well as polybrominated biphenyl (PBB) and  polybrominated  diphenyl ether (PBDE) flame retardants.  Part of the RoHS objective is to prevent thousands of tons of banned substances from being improperly disposed of, thus protecting human health as well as the environment.

As of November of 2010, there was an update to RoHS called the 2010 RoHS Recast.  The restriction updates are best depicted in a table:

The product categories effected by RoHS include large household appliances, computer equipment, TVs, lighting, toys and video games, and vending and ATM machines. Two categories – medical devices and equipment and control and monitoring equipment – are currently exempt from RoHS compliance.  More details about effected and RoHS exemptions and categories can be found on the UK RoHS website.

Producers must now prepare documentation to show that their products are compliant before placing them on the market, and, if requested, provide the documentation to the RoHS Enforcement Authority within 28 days. Also, this documentation must be maintained for four years after the product is no longer made available on the market.

The effect of RoHS has extended well beyond the EU. Major electronics manufacturers have adopted changes on a global scale in order to comply with RoHS, regardless of where their products are sold. As a result, companies that supply parts to these manufacturers must also track and maintain accurate information about these components.

1. What is the RoHS – REACH Connection? REACH regulations restrict the use of Substances of Very High Concern (SVHCs) in Europe and the importation of articles containing these substances from outside of Europe. RoHS complements REACH by limiting the amount of hazardous substances that can be used to produce EEE in Europe and defines the proper disposal of EEE waste.

2. Who is exempt from RoHS regulations? Private individuals making purchases from outside the European market are not required to comply with RoHS. Because the first importer of a product to the European market is responsible for complying with the regulations, businesses acquiring products from within Europe are also not required to comply.  Again, specifics about effected and exempt categories can be found on the RoHS website or in last year’s RoHS articles on the Actio Blog.

3. What are the costs and benefits of RoHS? According to the March, 2008 Final Report of the “Study of the RoHS and WEE Directives”, published by the environmental consulting firm Ecolas for the European Commission, RoHS has resulted in a major reduction of hazardous substances found in various products, reaping both environmental and economic benefits. You can view the report here.

Although RoHS presents many benefits, some of the costs associated with RoHS compliance have included R&D and capital costs, averaging 1.9% of annual revenues. For small and medium companies (SMEs), a consultancy called RSJ crunched the data and found the average cost of compliance for SMEs was as high as 5.2% of annual revenues.  That’s quite high.

Future and ongoing costs are estimated to the European Commission to average 0.4% of annual revenues.  These costs are due, in part, to increased administration and testing for compliance, the use of more expensive lead-free solder, the higher cost to manufacture lead-free components, and the lengthy exemption process.

4. Are there environmental benefits to RoHS? There are measurable environmental benefits to a well-executed and enforced RoHS program. Such environmental benefits include:

•    reduction of lead (Pb) use in products by 82,700 tons in the EU
•    reduction of cadmium (Cd) use in products by 14,200 tons
•    reduction of mercury (Hg) use in products by 9,500 tons due to changes in copiers and fluorescent light bulbs
•    reduction of mercury in waste streams by 6,900 tons

5. What are the big-picture benefits? Much analysis has been done leading to projections on the potential benefits of RoHS on a global scale.  Reports seems to show that primary benefits include:

•    increase of communication across the supply chain serves as a platform for the implementation of REACH and other initiatives
•    less leaching in landfills because WEEE contains less hazardous material
•    the use of lead-free solder increases the incentive to recycle because it contains silver and gold
•    the push for other countries and industries, such as aerospace and IT, to move to cleaner processes and reduced use of hazardous materials.