China Environmental Law

The Circular Economy Law is a curious blend of the usual general policy pronouncements found in Chinese legislation and some unusually specific requirements.  There is little in the law, however, that is new.  Most of its provisions are already on the books in China in either previously enacted laws (most notably the Clean Production Law, the Energy Conservation Law, and the Water Law) or regulations.  The law does at least raise the profile of the “circular economy” principles of reduce, recycle, and reuse, and for that reason alone constitutes an important addition to China’s environmental law Pantheon. 

We will start a detailed look at the laws requirements today, and continue through the week.

General Principles (Chapter One)

The law is “formulated for the purposes of promoting the development of the circular economy, improving resource utilization efficiency, protecting and improving the environment and realizing sustainable development” (Article 1).  The “circular economy” is defined as one which adopts “reduction, reuse and recycling concepts in the process of production, circulation and consumption” (Article 2), and it is to “be propelled by the government, led by the market, effected by enterprises and participated in by the public” (Article 3).

Circular economy considerations are to be included in all industrial, economic and social development plans at the national, regional, and local level (Article 6).

Regional governments are to establish a “target responsibility” for the development of a “circular economy” (Article 8), which essentially means they should assign targets to subordinate departments to meet in order to fulfill their responsibilities under the law.

“Enterprises and public institutions shall set up management systems and take measures to reduce the consumption of resources, reduce the production and discharge of wastes and improve the reutilization and recycling level of wastes” (Article 9).

Administration (Chapter Two)

National and sub-national Circular Economy Development Plans are to be developed which set “objectives, scope of application, major contents, major tasks and safeguard measures” to achieve a circular economy, and shall set such indicators regarding “resource output capacity, waste reutilization rate and waste recycling rate, etc.” (Article 12).

Regional governments are assigned certain targets (presumably as part of the target responsibility system) which must be met for “major indicators,” specifically “discharge of major pollutants, the land used for construction and the total volume of water consumption.”  The regions industrial structure and construction project approval criteria should be geared toward the achievement of the assigned targets (Article 13).

Local officials will be evaluated based on whether they hit their assigned “major indicator” targets, but since achievement of the identified “major indicators” (with the possible exception of “the land used for construction”) is also required in prior laws, this is not a particularly significant development.  Curiously, the law does not identify energy conservation as a “major indicator,” but it is already addressed in the Energy Conservation Law.  (article 14).

A Catalogue of Products and Packages subject to Compulsory Recycling will be developed.  Producers of products listed in the catalogue are responsible for recycling discarded products or packaging or, if recycling is technically or economically impossible, shall render them harmless. A producer can contractually delegate these responsibilities to its distributors or “other organizations” (presumably third party recycling operations); it is unclear whether in such instances the product or packaging producer remains primarily liable if recycling does not occur (Article 15).  

Chinese legislation loves the “catalogue,” and I welcome this one.  Chinese regulators are not always so good at describing how one regulation on a given topic fits with another one addressing the same topic, especially if the other regulation is issued by a different ministry or department.  I hope this Catalogue will become the standard reference for determining if a product or package is in or out of China’s comprehensive recycling scheme.  For more on the status of this “scheme” see Adam Minter’s comment on the left and go to the stimulating and seminal (I always hoped I would get the chance to use those two words in the same sentence) Shanghai Scrap.

 ”Key enterprises” which includes those “in the high energy or water consuming industries such as steel, non-ferrous metal, coal, electric power, petroleum processing, chemical industry, building materials, building construction, paper-making, printing and dyeing” are to be supervised as to energy conservation according to the Energy Conservation Law and as to water conservation according to “measures” developed by the “administrative department of circular economy development and other relevant departments under the State Council” (Article 16).

A “circular economy statistical system,” “standards for saving energy, saving water, saving materials and reutilizing and recycling wastes,” and a “system of labeling the resource consumption level (such as energy efficiency) of products” shall also be developed (Article 17).

Happy Mid-Autumn Festival!  More tomorrow.