In Part 1 of this series we discussed the second draft of the R2v3 standard – specifically, the introduction. This covered applicability and scope as well as Sanctioned Interpretations, and highlighted some areas we want to pay attention to. Part 2 reviewed the Definitions section – some changes, additions, deletions, and the Focus Materials Table.
In Part 3, we started digging in to the standard’s Core Requirements – the auditable portion of the R2v3 standard. Specifically, the Scope and Hierarchy of Responsible Management Strategies.
In Part 4 of the series, we covered two short, but very important, Core Requirements (CR) – CR 3, EH&S Management System, and CR 4, Legal and Other Requirements.
Part 5 – addressing Throughput Tracking (R2:2013 Provision 7)
The standard has been clarified, throughout, to provide better definitions. CR 5 is no different – we see subtle changes such as changing “FMs” to “R2 Controlled Streams” (to include multiple streams as defined by the recycler itself); and changing the phrase “recycler” to “R2 facility”, again putting emphasis on the fact that R2 is a facility-based registration scheme.
The change from “FMs” to “R2 Controlled Streams” was made specifically to address those recyclers who are processing inbound streams of FMs – it is impractical to receive the FMs and know the breakdown at inbound – the breakdown is often not known until the gaylord has been processed.
The requirements for inbound electronics has not changed from the first draft, and still requires
(1) Maintain bills of lading or other commercially-accepted records, and
(2) Ensure records have accurate dates, detailed descriptions including types and quantities, and supplier names, and
(3) Maintain a summary report of all transactions.
CR 5 addresses “negative value”, and while comments asked questions on what this means, the standard itself did not change. However, the TAC (Technical Advisory Committee) did provide the following Disposition/TAC Response comment, which I find enlightening:
“Negative value” refers to any equipment, components, or materials, that incur a cost to manage either by the R2 Facility or its verified downstream vendor. The value of equipment, components, or materials may change over time due to various factors including age of the item, condition of the item, and resale or commodity market conditions, which all should be considered when determining value.
This requirement does not apply to tested and fully functioning equipment, since “equipment or components demonstrated to be functional in accordance with the R2 Equipment Categorization are exempt from controls of equipment and components containing Focus Materials in the R2 Standard because of their functioning status” (footnote 4 – Core Requirement 6. Sorting, Categorization, and Processing).
Let’s unpack that a bit – companies that are holding older inventory, that has depreciated below its value, can be termed negative value. The R2v3 standard, CR 5.b.3, calls out that you should not store materials with negative value for longer than one year (with two exceptions noted).
These exceptions state:
(A) Components have been evaluated and inventoried in accordance Appendix C – Test and Repair, or
(B) Complete applications for regulatory permits or other authorizations for the export of the R2 Controlled Stream to the verified downstream vendor have been applied for within the usual issuing timeframe, but not yet received from the governing authority, and where storage is otherwise legally permissible.
So, we can store spare parts (that may actually have negative value) in our inventory without having to worry about purging them in twelve months; this is important to some clients, who have a huge inventory of ‘spare swaps’ to make working boards, as an example…
… and for companies who have to apply for transboundary shipment permits to allow export of hazardous FMs to overseas smelter, which often takes longer than a year, CR 5.b.3.b will now allow this.
As always, CR 5 calls out that records need to be kept. While not a new requirement, it’s a good idea to remember that CR 5 states
(c) For all outbound electronic equipment, components, and materials, controlled by the R2 Facility, the R2 Facility shall:
(1) Maintain bills of lading, or other commercially-accepted records, and
(2) Ensure records have accurate dates, detailed descriptions including types and quantities, and customer or downstream vendor names, and (3) Maintain a summary report of all transactions.
Core Requirement 5.(a)(3) –
The inbound summary report would be expected to include:
- Supplier Name and Location;
- Type of Materials/Equipment Received;
- Quantities; and
- Date of Receipt Core Requirement
5.(c)(3) – The outbound summary would be expected to include:
- Downstream Vendor Name and Location;
- Type of Materials/Equipment;
- Date of Shipment; and
- Unique Shipment Identification
It is important to note that “mass balance” is NOT a requirement for this section. For companies that receive large quantities of materials in shipments that are not subject to R2, where mass balance would be both a logistical nightmare and counter-productive, the requirements as listed above should suffice to meet the R2v3 requirements.
While these are not released versions of the R2v3 standard (yet), it is important to note that requirements for CR 5 have been updated, and to start to implement these requirements in anticipation of the release of the Standard.
But wait – we’re not done yet!
Next up: Core Requirement 6 – Sorting Categorization and Processing
Want to dig in to this in more detail? Can’t wait for the entire series and want to engage with us now? Contact us to start the process!
Would you like to talk through alternatives on implementation with us? Just contact us to set up a time to talk!