China Environmental Law

The final version of the Circular Economy Law is substantially similar to the draft version of June 2007.  The lawmakers have tinkered with some language here and there and made seemingly arbitrary changes to some penalty amounts (some increased, some decreased), but there are only a few substantive revisions.  Most of these revisions were previously discussed here.  For ease of reference, I will include those previously identified sections in the discussion below.

Substantive Revisions

Administration (Chapter Two)

The draft version vested most responsibility for the implementation of the law in the “department of comprehensive macro-control of economy of the State Council” (经济综合宏观调控部门), while the final version vests that responsibility in the “department of circular economy development under the State Council” (循环经济发展综合管理部门). 

The draft version entity would clearly have been associated with the National Development and Reform Commission (NDRC), the final version entity is not so clearly associated with the NDRC, and may give the State Council to designated another Ministry or perhaps create an ad hoc group to implement the law.  My bet would be the NDRC still gets the nod, but we will see how this develops. 

The final version deletes the following provision of the draft:

Article 14.3国务院和县级以上地方人民政府向同级人民代表大会报告政府工作时，应当同时报告循环经济发展工作。

The State Council and the local people’s governments at or above the county level shall report the work for the development of recycling economy at the time of reporting government works to the people’s congresses of the same level.

I’m not sure why this provision was axed.  The deletion would seem to demote the importance of circular economy activities.

The draft provided more specific requirements on “enterprises” with respect to energy and water conservation.  The final version simply notes that energy conservation efforts shall be in accordance with the Energy Conservation Law, and that enterprise water conservation “supervision and administration” shall be worked out by the department of circular economy development under the State Council.

Reduction (Chapter Three)

As previously noted, the final version deletes the following provision of the draft:

Article 26.1国家对城市居民生活所用的电、气、自来水等资源性产品，根据实际需要和可能实行累进加价和收费制度。具体办法由国务院或者省、自治区、直辖市人民政府制定。

The State will implement the system of graduated increase of prices and fees for electricity, gas, tap water and other products of resource nature used in the ordinary life of urban residents according to the reality and possibility. The concrete measures shall be formulated by the State Council or the people’s governments at the provinces, autonomous regions and municipalities directly under the Central Government.

This provision called for the implementation of inclining block rates for “electricity, gas, tap water and other products of resource nature used in the ordinary life of urban residents,” but it was deleted apparently based on the fear that such a pricing scheme could have had an inflationary impact.

Perhaps to provide some flexibility to use utility pricing to aid conservation efforts in the future, a new sentence has been added to Article 46 which provides:

第四十六条 国家实行有利于资源节约和合理利用的价格政策，引导单位和个人节约和合理使用水、电、气等资源性产品。

Article 46 The state adopts a price policy that contributes to the conservation and reasonable utilization of resources so as to guide entities and individuals to save and reasonably use water, electric power, gas and other resource products. 

Reuse and Recycling (Chapter Four)

The final version adds a provision to Article 29 which provides:

新建和改造各类产业园区应当依法进行环境影响评价，并采取生态保护和污染控制措施，确保本区域的环境质量达到规定的标准。

An environmental impact assessment shall be conducted before any industrial park or zone is built or rebuilt, and measures for ecological protection and pollution control shall be taken to ensure that the environmental quality of that region reaches the prescribed standards.

This seems redundant of the requirements of the Environmental Impact Assessment Law, but I guess there is nothing wrong with a belt and suspenders approach to lawmaking.

As previously noted the final version deletes the following provisions of the draft:

第四十条 【报废机动车船回收拆解】 

Article 40      Recovery and Dismantling of Scrapper Motor Vehicles or Vessels

报废机动车船的所有者，必须将所报废的机动车船交售给回收、拆解机动车船的企业。

The owners of scrapped motor vehicles or vessels shall sell and deliver the scrapped vehicles or vessels to enterprises engaged in recovering and dismantling vehicles or vessels.

回收后的报废机动车船必须拆解，禁止重新拼装使用。

Any scrapped vehicles or vessels as recovered shall be dismantled and any reassembly thereof for use is prohibited.

第四十一条 【产品再制造和轮胎翻新】

Article 41       Product Remanufacture and Tire Retreading

国家支持企业开展机动车零部件、工程机械、机床等产品的再制造和轮胎翻新。

The State supports enterprises in carrying out the remanufacture of such products as vehicle components, engineering machinery and machine tools as well as tire retreading.

销售再制造产品和翻新产品必须符合国家规定的质量标准，并在显著位置标识为再制造产品或者翻新产品。

The sale of remanufactured and retread products shall comply with the quality standards specified by the State and mark the same as remanufactured products or retread products at a conspicuous position.

These provisions were replaced by a much shorter provision which simply encourages the refurbishment of parts and components of motor vehicles:

第四十条。 国家支持企业开展机动车零部件、工程机械、机床等产品的再制造和轮胎翻新。销售的再制造产品和翻新产品的质量必须符合国家规定的标准，并在显著位置标识为再制造产品或者翻新产品。

Article 40 The state supports enterprises to reproduce the parts and components of motor vehicles, engineering equipment, machine tools, etc. and to renew tires.

Any reproduced or renewed product to be  sold shall satisfy the prescribed quality standards of the state and be labeled as a reproduced or renewed product at an eye-catching place.

Supplemental Provisions (Chapter Seven)

The draft law was one of the rare species of Chinese legislation which actually bothered to define some of the important regulatory terms.  The final version has deleted most of them, although a few remain in Article 2.  For posterity’s sake, here’s what was deleted from the draft:

第六十条 【相关术语的定义】

Article 60      Term Definitions

本法中下列用语的含义是：

As used in this Law, the following terms shall have the following meanings:  

（一）废物，是指在生产、生活和其他活动中产生的丧失原有利用价值或者虽未丧失利用价值但被抛弃或者放弃的物品、物质以及法律、行政法规规定纳入废物管理的物品、物质，包括产业废物和流通、消费后产生的废物。

(1)       “Wastes” shall mean the articles or substances that loss their original use value or that are abandoned or unwanted despite their use value retained and those classified into the category of wastes by laws and administrative regulations and therefore under the management of wastes, including industrial wastes and post-circulation and consumption wastes. 

（二）产业废物，是指在生产过程中产生的废渣、废水(液)、废气、余热、余压等物质。

(2)       “Industrial wastes” shall mean such substances as waste residues, waste water/fluid, waste gas, residual heat, and residual pressure that are resulted from the course of production.

（三）再生利用，是指经过加工将废物的全部或者部分作为原料予以使用，其产品为再生产品。

(3) “Recycling and reuse” shall mean using the whole or part of wastes after processing as raw materials, and the products derived there from are called recycling products.

（四）再制造，是指将废弃产品及零部件修复、改造成质量等同于或者优于原产品的制造过程，其产品为再制造产品。

(4) “Remanufacture” shall mean the manufacturing process in which scrapped products or components are recovered or reformed for quality identical with or superior to the original products. The products derived there from are remanufactured products.

（五）资源综合利用，是再利用、资源化以及对共生、伴生矿产资源进行合理利用的统称。

(5) “Comprehensive utilization of resources” is the joint name for reuse, recycling, and reasonable utilization of associated minerals.

Up next will be a look at the substantive requirements of the new Law, and what to expect in the future.