India Announces Draft End-of-Life Vehicles Rules

On January 30, 2023, the Ministry of Environment, Forest and Climate Change of India (MoEFCC) announced the draft End-of-Life Vehicles (Management) Rules, 2024. The draft Rules will establish an Extended Producer Responsibility (EPR) system for automobile manufacturers and others starting in April 2025 to promote the environmentally appropriate disposal of End-of-Life Vehicles (ELVs). Companies that qualify as producers are required to achieve steel recycling targets, register on a dedicated portal, and submit annual reports. While guidelines for ELV processors and recyclers have been promulgated in the past, this draft Rules will be the first full-fledged EPR regulation targeting automobile manufacturers. It also covers electric vehicles (EVs), including e-rickshaws and e-carts. However, it did not contain any provisions such as restrictions on contained substances or the use of recycled materials.

Definitions

“Producer” means an entity who engages in domestic market for:

• • (i) manufacture/assembly and sale of vehicles under its own brand
  • (ii) sale of vehicles under its own brand produced by other manufacturers or suppliers
  • (iii) import of vehicles
  • (iv) manufacture/assembly and sale of vehicles to producer of (ii) above, not under its own brand

“End-of-Life Vehicle” means a vehicle:

• • which is no longer validly registered
  • which has been declared unfit by Automated Testing Station after undergoing test or re-test as specified under the provisions of the Central Motor Vehicles (Twenty first Amendment) Rules, 2021 or Central Motor Vehicles (Eight Amendment) Rules, 2022
  • of which registration has been cancelled under Chapter IV of the Central Motor Vehicles Act, 1988 (59 of 1988)
  • declared as End-of-Life due to an order of a Court of Law
  • which is self-declared by the legitimate registered owner as a waste vehicle due to any circumstances that may arise from fire, damage, natural disaster, riots or accidents, or otherwise

Recycling Targets

Producers must achieve steel recycling targets set for each fiscal year by obtaining EPR certificates through their own recycling facilities, or by purchasing from recyclers. The target is calculated separately for private vehicles and commercial vehicles as follows. The definitions of private vehicles and commercial vehicles, however, is not specified in the draft.

Private vehicles:

• • Each year between 2025-26~2029-30: 10% of the steel used in vehicles placed in market 20 years ago
  • Each year between 2030-31~2034-35: 20% of the steel used in vehicles placed in market 20 years ago
  • Each year between 2035-36~2039-40: 30% of the steel used in vehicles placed in market 20 years ago

Commercial vehicles:

• • Each year between 2025-26~2029-30: 10% of the steel used in vehicles placed in market 12 years ago
  • Each year between 2030-31~2034-35: 20% of the steel used in vehicles placed in market 12 years ago
  • Each year between 2035-36~2039-40: 30% of the steel used in vehicles placed in market 12 years ago

*Note the wording of “vehicles placed in market”, which is different from “sold”.

Registration

Producers will be required to register on a portal, which will be made available within six months of promulgation of the Rules.

Annual Returns

Producers must also submit annual returns for the previous year by June 30 of each fiscal year. Items to be reported include the amount and type of vehicles placed on the market during the previous year, amount of steel used, and the fulfillment of recycling targets.

Environmental Compensation

Violations, including the failure to comply with recycling obligations, are assessed in the form of a penalty called environmental compensation. The difference from general penalties is that if the violations are addressed within three years of the imposition, a portion of the amount imposed will be refunded to the violator.

Download the draft Rules here:
https://egazette.gov.in/writeReadData/2024/251663.pdf

EnviX Comment

The obligations provisioned in this ELV draft (registration, recycling targets, annual returns) are very similar to those current EPR schemes in force, which includes plastic packaging, waste tyres, electrical and electronic equipment, batteries, and used oil. Although not as strict as those of the ELV Directive of EU, India’s waste-related laws and regulations such as the EPR have been continuously enacted and tightened in recent years.

Producers are encouraged to collect data on steel used in vehicles placed on the market in India after 2005, as part of the producers’ obligations. In addition, it is also advisable to collect data and identify appropriate recyclers for the purchase of EPR certificates.