European Union: Study On Built-In Obsolescence Of Electrical And Electronic Devices

Last Updated: 11 September 2017
Article by Koen T’Syen

On 12 May 2017, the Minister of Economic and Consumer Affairs Kris Peeters and the Minister for Energy, Environment and Sustainable Growth Marie-Christine Marghem released the results of a study on built-in obsolescence which they had commissioned in the aftermath of the VW Diesel scandal (the study is available here). The term "built-in obsolescence" refers to any technique used by manufacturers to limit deliberately the lifetime of a product, thereby accelerating its replacement.

The primary aim of the study was to investigate to what extent manufacturers program the obsolescence of their electrical and electronic devices. Although the study found little proof of programmers actually building-in obsolescence, it notes that it cannot be ruled out that built-in obsolescence actually exists. Moreover, the study finds that consumers are genuinely frustrated when the actual lifetime of the products which they purchase does not correspond to their expected lifetime. Therefore, the study's scope was expanded into investigating possible measures to extend the lifetime of products. This is noteworthy given that, at least conceptually, there is a significant difference between combating built-in obsolescence and extending the lifetime of products.

According to the study, the main obstacle to extending the lifetime of electrical and electronic devices is that their repair may be technically difficult and/or too expensive. For some products, the environmental benefit of repair can be non-existent or negative. With this in mind, the study puts forward possible measures to achieve three key objectives that contribute to extending the lifetime of electrical and electronic devices:

  1. promote eco-design and sustainable purchases by consumers;
  2. promote a better use of products; and
  3. promote the repair of products.

The study notes that the first objective can be achieved most effectively by: (i) requiring manufacturers to specify the expected lifetime of the products based on an objective assessment method; and (ii) extending the statutory warranty period (in a variable way depending on the expected lifetime of the products concerned). In addition, the study advocates extending from six months to two years the time period during which a specific type of defect, namely the lack of conformity of the good supplied with the good ordered, is presumed to exist at the time of delivery.

According to the study, the second objective can be achieved only by setting up an information campaign to create awareness amongst consumers.

Furthermore, the third objective can be achieved most effectively by requiring manufacturers to: (i) specify the level of reparability of their products based on an objective assessment method; (ii) specify the period during which they commit themselves to supply replacement parts; and (iii) make replacement parts, product plans and tools necessary for replacement to be available at a reasonable price.

All three objectives can be furthered by information campaigns and measures to stimulate a functional economy. The notion of a "functional economy" is an innovative economical model (IEM) aimed at optimising the costs and revenues of manufacturers by selling the service provided by a product rather than the product itself. In this model, the manufacturer remains the owner of the product. As a result, he is encouraged to extend the product's lifetime, foster reparability and ensure the optimal use of the product by the consumer. Other possible supporting measures put forward by the study are: (i) reducing the VAT rate for the repair of products; (ii) reducing the social security costs for the repair of products; and (iii) enabling consumers to deduct the costs of repair from their tax bill.

Referring to calculations of the European Commission, the study notes that strong measures incentivising more repairs of products could create up to 1,300 jobs in the repair industry in Belgium. However, approximately 450 jobs would disappear in other sectors such as production and distribution, which would result in a net job gain of about 850 jobs.

Ministers Peeters and Marghem have already announced that they will further investigate the proposed measures. Meanwhile, Minister Peeters is working on an extension of the warranty obligations of sellers (see VBB on Belgian Business Law, Volume 2017, No. 1, p. 11, available at www.vbb.com).

Separately, on 22 January 2016, members of the French-speaking Christian Democrat party (cdH) had already submitted a Bill to the Chamber of Representatives to combat built-in obsolescence (Wetsvoorstel tot wijziging van het Burgerlijk Wetboek en van het Wetboek van Economisch Recht, teneinde ingebouwde veroudering tegen te gaan/Proposition de loi modifiant le Code civil et le Code de droit économique, visant à lutter contre l'obsolescence programmée – see VBB on Belgian Business Law, Volume 2016, No. 1, p. 3, available at www.vbb.com). It remains to be seen whether it stands any chance of becoming law.

It is interesting to note that, on 4 July 2017, the European Parliament adopted a Resolution on a longer lifetime for products, in which it calls on measures to extend product lifetimes (available here). Moreover, in December 2016, Belgium, Luxembourg and the Netherlands signed a Benelux Directive on the practical application of the circular economy in which they agreed to cooperate closely in the period 2017-2020 in order to accelerate the transition to a circular economy.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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