Earlier this year, the Commerce Department’s Bureau of Industry and Security (BIS) proposed regulations that would strengthen U.S. government oversight of discarded electronic waste export policies that affect U.S. regulations. The agency’s proposed rule could restrict certain electronic waste exports altogether, requiring those items to be disposed of domestically. Permissible electronic waste exports under the proposed rule would be subject to a new license exception or other reporting requirements, as well as new record keeping and tracking requirements, BIS said.
If amended, the restriction regulations set forth by the BIS concerning the exportation of used electronics would not only provide a false sense of security but would impose a significant effect on the consumer electronic industry.
In the sphere of international trade, electronic waste can also be classified as “used electronics” due to the material’s potential for reuse, refurbishment and recycle. In fact, many OEMs have “priced-in” the reuse, refurbishment and recycling opportunities of their own products at the end of leases. This has allowed for a post-consumer market that provides stable and affordable prices for electronic devices — without this market opportunity, prices would only increase. Therefore, trade of used electronics not only yields more profits for both parties involved but it greatly reduces the costs of disposal for consumers. An electronic waste ban would only remove these benefits and impose direct environmental costs for all.
With international trade of this material already taking place, a ban on electronic waste exports would do little in the effort to strengthen national security. The source of such material is everywhere, so controlling the electronic waste flow from the U.S. will not stop or fix any potential security issue. Despite the BIS citing counterfeit chips as a reason to place a ban on electronic waste, there is no concrete evidence that these chips originated from used electronics exported from the U.S. Various countries manufacture electronic equipment, including chips, therefore any indication of counterfeit chips could stem from just about anywhere. Due to the large number of players in the industry, a U.S. ban is simply not justifiable.
The ability to leverage the world market for tested, refurbished electronics is a critical aspect of the success of companies like HOBI in the reverse logistics industry. The regulations put forth by BIS will put a burden on these companies leaving them at an unfair competitive disadvantage to competitors in the world market. This will result in the loss of revenue and loss of jobs. Up to 30 percent of HOBI’s 350-person workforce would be in jeopardy if HOBI is put at a competitive disadvantage in leveraging the worldwide demand for refurbished electronics.