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EU battery regulation overview

Date of publication: August 13th, 2024
Summary
Regulation (EU) 2023/1542 of the European Parliament and of the Council, dated 12 July 2023, addresses the management of batteries and waste batteries within the European Union. It amends Directive 2008/98/EC and Regulation (EU) 2019/1020 and repeals the previous Battery Directive 2006/66/EC. This falls under the set of policy initiatives of the EU Green Deal. Batteries are a key technology that play a central role in advancing EU's climate neutrality by 2050.The regulation seeks to protect human health and the environment by promoting a circular economy for the life cycle of batteries, from raw material extraction and mining to manufacturing, availability on the market, usage, collection and recycling, and disposal. It also includes rules on sustainability, safety, labeling, and marking.Key areas covered under the regulation include:
  • Ensuring the sustainability, safety, labeling, and information requirements for batteries,
  • Mandating the collection and treatment of waste batteries,
  • Establishing extended producer responsibility
  • Introduction of reporting requirements
  • Due diligence obligations on economic operators to mitigate social and environmental risks associated with battery production and supply chains,
  • Provisions for the carbon footprint and recycled content of batteries, as well as performance and durability requirements,
  • Procedures for conformity assessment, market surveillance, and the use of a battery passport to enhance transparency and traceability.
Scope of the regulation
All batteries placed on the EU market are in scope, even if they’re manufactured outside of the EU. This applies to all categories of batteries, namely portable batteries, starting, lighting and ignition batteries (SLI batteries), light means of transport batteries (LMT batteries), electric vehicle batteries and industrial batteries, regardless of their shape, volume, weight, design, material composition, chemistry, use or purpose. It shall also apply to batteries that are incorporated into or added to products or that are specifically designed to be incorporated into or added to products.Where batteries placed on the market can be considered to fall under more than one category, they shall be deemed to fall under the category to which the strictest requirements apply.This Regulation does not apply to batteries that are incorporated into or that are specifically designed to be incorporated into:
  1. Equipment connected with the protection of EU Member States’ essential security interests, arms, munitions and war material, with the exclusion of products that are not intended for specifically military purposes; and
  2. Equipment designed to be sent into space.
Economic operators that are in scope are defined by the regulation as importers, manufacturers, distributors, authorized representatives, fulfillment service providers, or others that place batteries or make them available on the EU market. The regulation provides for an exemption for SMEs from the due diligence rules.
Timelines
The regulation entered into force on August 17, 2023, and became fully applicable from February 18, 2024, with specific provisions coming into effect on later dates using a phased-in approach. Starting from 2025, the Regulation will gradually introduce declaration requirements, performance classes and maximum limits on the carbon footprint of electric vehicles, light means of transport (such as e-bikes and scooters) and rechargeable industrial batteries.Sustainability requirements on carbon footprint, recycled content and performance and durability will be introduced gradually:
  • A more comprehensive regulatory framework on Extended Producer Responsibility will start applying by mid-2025, with higher collection targets being introduced over time.
  • For portable batteries the targets will be 63% in 2027 and 73% in 2030.
  • For batteries from light means of transport, the target will be 51% in 2028 and 61% in 2031.
  • All collected batteries must be recycled, and high levels of recovery must be achieved, in particular, of valuable materials such as copper, cobalt, lithium, nickel and lead. This will guarantee that valuable materials are recovered at the end of their useful life and brought back in the economy by adopting stricter targets for recycling efficiency and material recovery over time. Material recovery targets for lithium will be 50% by 2027 and 80% by 2031.
Battery types context
Batteries can be either primary (non-rechargeable) or secondary (rechargeable). They can also be classified according to use, technology or size. The most common differentiation, is between portable batteries (those mainly used in consumer electronics, communication and computing, known as '3C'); automotive batteries (used for automotive starter, lighting or ignition power and traction batteries used in electric and plug-in hybrids); and industrial batteries. There are major variations in chemical composition and construction between different battery types. Batteries contain a wide variety of materials, such as base metals, critical raw materials and chemicals, which can raise issues in terms of resource availability, toxicity, safety, production and recycling or disposal impacts.
Critical raw materials embedded in batteries include for instance antimony in lead-acid batteries; rare earth elements in nickel-metal hydride batteries; and cobalt and natural graphite in lithium-ion batteries. Mining and exploitation of some battery minerals can be associated with adverse environmental impacts (e.g. local water, soil and air pollution; ecosystem and landscape degradation), human rights violations and poor worker protection. For example, nearly half of the world's cobalt reserves lie in the Democratic Republic of Congo (DRC), which accounts for over two-thirds of global cobalt production. Around 20% of the cobalt sourced from the DRC comes from artisanal mines, where child labor and human rights issues have been documented. China, South Africa and Brazil have also been noted as having risks for responsible sourcing.
With respect to carbon footprint issues, the most greenhouse gas (GHG) emission-intense steps in the battery value chain are the manufacturing of active materials and other components, and the manufacturing of cells. Production of lithium-ion batteries, or at least the cells they contain, generally takes place in Asian countries, with an energy mix relying on more polluting sources.
Issues such as those noted above must be considered with respect to responsible sourcing due diligence and compliance with the regulation itself. Under the new law’s due diligence obligations, companies must identify, prevent and address social and environmental risks linked to the sourcing, processing and trading of raw materials such as lithium, cobalt, nickel and natural graphite contained in their batteries. The expected massive increase in demand for batteries in the EU should not contribute to an increase of such environmental and social risks.
Importer obligations
  1. Importers shall only place on the market a battery which is compliant with Articles 6 to 10 and Articles 12, 13 and 14.
  2. Before placing a battery on the market, importers shall verify that:
  1. the EU declaration of conformity and technical documentation referred to in Annex VIII have been drawn up and that the relevant conformity assessment procedure referred to in Article 17 has been carried out by the manufacturer;
  2. the battery bears the CE marking referred to in Article 19, and is marked and labelled in accordance with Article 13;
  3. the battery is accompanied by the documents required pursuant to Articles 6 to 10 and Articles 12, 13 and 14 and by instructions and safety information in a language or languages which can be easily understood by end-users, as determined by the Member State in which the battery is to be made available on the market; and
  4. the manufacturer has complied with the requirements laid down in Article 38(6) and (7) related to identification markings as well as company name, registered trade name or registered trademark, their postal address, indicating a single contact point, and, if available, web and email address.
    Where an importer considers or has reason to believe that a battery is not in conformity, the importer shall not place that battery on the market until it has been brought into conformity. Additionally, where the battery presents a risk, the importer shall inform the manufacturer and the market surveillance authorities giving details of the non-compliance and of any corrective action taken.
  5. Importers shall indicate on the battery their name, registered trade name or registered trademark, their postal address, indicating a single contact point, and, if available, web and email address. Where that is not possible, the required information shall be provided on the packaging or in a document accompanying the battery. The contact details shall be in a language or languages which can be easily understood by end-users, as determined by the Member State in which the battery is to be made available on the market, and shall be clear, understandable and legible.
  6. Importers shall ensure that, while a battery is under their responsibility, storage or transport conditions do not jeopardize its compliance
  7. When deemed appropriate regarding the risks presented by a battery, importers shall, to protect the human health and safety of consumers, carry out sample testing of marketed batteries, investigate, and, if necessary, keep a register of complaints, of non-conforming batteries and battery recalls, and shall keep distributors informed of such monitoring.
  8. Importers who consider or have reason to believe that a battery which they have placed on the market is not in conformity with, shall immediately take the corrective action necessary to bring that battery into conformity, to withdraw it or recall it, as appropriate. Furthermore, where the battery presents a risk, importers shall immediately inform the market surveillance authority of the Member State in which they made the battery available on the market, giving details, in particular, of the non-compliance and of any corrective action taken.
  9. Importers shall, for 10 years after the battery has been placed on the market, keep a copy of the EU declaration of conformity at the disposal of the national authorities and ensure that the technical documentation referred to in Annex VIII is made available to those authorities, upon request.
  10. Importers shall, further to a reasoned request from a national authority, provide that authority with all the information and documentation necessary to demonstrate the conformity, in a language or languages which can be easily understood by that authority. That information and the documentation shall be provided in electronic format and, on request, in paper format. Importers shall cooperate with the national authority, at its request, on any action taken to eliminate the risks posed by batteries, which they have placed on the market.
Due diligence obligations
Economic operators placing batteries on the EU market must conduct thorough due diligence. These will apply from two years after the entry into force of the Regulation. The key obligation is the requirement for economic operators to adopt and clearly communicate, to both suppliers and the public, a company due diligence policy for batteries. The due diligence policy is required to cover specified raw materials and social and environmental risks and must be consistent with several internationally recognized due diligence standards. Responsibility for oversight of the policy is also required to be assigned to the "top management level" to ensure executive accountability.
Labeling and marking requirements
The Regulation includes several detailed requirements pertaining to the labelling and marking of batteries and the delivery of information to end-users. This includes:
  • Battery passport: LMT, industrial and EV batteries will be required to have a digital battery passport, starting 3.5 years after entry into force of the Regulation. This is to provide transparency relating to the battery's supply chain. The information contained in the battery passport must be accessible to the general public, although certain information may be accessible only by regulatory authorities and other specified entities.
  • Carbon footprint declaration: LMT, industrial and EV batteries will be required to have a carbon footprint declaration indicating their carbon footprint and carbon footprint performance class, with a maximum lifecycle carbon footprint threshold to apply eventually. The methodology for the calculation and verification of the carbon footprint, the carbon footprint performance classes and the maximum lifecycle carbon footprint threshold will be provided for in an authorized act.
Although the regulation itself is very robust and comprehensive with respect to the full lifecycle of batteries, much of the crucial technical detail, however, remains to be fleshed out via implementing legislation over the coming years. Much will also depend on the approach to enforcement taken by national regulators, particularly in relation to scrutiny of compliance with due diligence obligations.This article, however, has focused primarily on the obligations of EU Importers, it is recommended that manufacturers, distributors, fulfillment service providers and authorized representatives that will be placing batteries on the EU market, review the regulation thoroughly to ensure that they are also meeting the compliance obligations for their respective stakeholder roles.For more information on how ONESOURCE Global Trade solutions can assist you in managing your global trade compliance obligations, please contact your Account Manager or Client Services Manager.