EN    EN EN 
 
EN    EN  COMMISSION OF THE E UROPEAN COMMUNITIES 
Brussels, 1.8.2008 
SEC (2008) 2366 final 
  
COMMISSION STAFF WORKING DOCUMENT 
Reviewing Regulation (EC) N° 2037/2000 on s ubstances that deplete the ozone layer 
"Better regulation building on 20 years of success" 
Impact Assessment 
 
Accompanying the Proposal for a Regulation  of the European Parliament and Council 
on Substances that Deplet e the Ozone Layer (Recast) 
 
[COM(2008) 505 final] 
[SEC (2008) 2367] 
 
EN ii   EN COMMISSION STAFF WORKING DOCUMENT 
Reviewing Regulation (EC) N° 2037/200 0 on Substances that Deplete the 
Ozone Layer  
 
"Better Regulation –Building on 20 Years of Success" 
Impact Assessment  
 
Accompanying the Proposal for a Regulati on of the European Parliament and 
Council on Substances that Depl ete the Ozone Layer (Recast) 
[COM(2008) 505 final] 
[SEC (2008) 2367]  
 
EN 3   EN TABLE OF CONTENTS 
COMMISSION STAFF WORKI NG DOCUMENT Reviewing Regulation (EC) N° 
2037/2000 on substances that deplete the ozone layer "Better regulati on building on 20 years 
of success" Impact Assessment Accompanying th e Proposal for a Regulation of the European 
Parliament and Council on Substances that De plete the Ozone Layer (Recast) [COM (2008) 
xxx final] [COM(2008) xxx final] [SEC (2008) xxx]................................................................ 1 
COMMISSION STAFF WORKI NG DOCUMENT Reviewing Regulation (EC) N° 
2037/2000 on Substances that Deplete the Ozone Layer "Better Regulation –Building on 20 
Years of Success" Impact Assessment Accomp anying the Proposal for a Regulation of the 
European Parliament and Council on Substances  that Deplete the Ozone Layer (Recast)........ ii 
1. Introduction.................................................................................................................. 6  
2. Policy Background....................................................................................................... 7  
2.1. The Montreal Protocol –From Environm ental Pioneering to Hailed Multilateral 
Environmental Agreement in 20 Years........................................................................ 7 
2.2. Remaining Global Challenges Related to Recovery of the Ozone Layer.................. 10 2.3. Regulation (EC) N° 2037/2000 on Substan ces that Deplete the Ozone Layer –
Leading the Montreal Protocol Implementation ........................................................ 12 
3. General Problem Definition and Objectives .............................................................. 14  
3.1. Defining the Remaining Problems to be Tackled in the EU Based on the 2010 
Outlook....................................................................................................................... 1 4 
3.2. General and Specific Objectives ................................................................................ 16 3.3. Method and Criteria for Assessing the Impacts ......................................................... 17 3.4. Who may be affected?................................................................................................ 18 4. Developing Viable Policy Options............................................................................. 19  
4.1. Maintaining the Business as Usual Scenario ............................................................. 19 4.2. Withdrawing the Regulation ...................................................................................... 19 4.3. Towards Simpler and Better Regulation.................................................................... 19 4.4. Other Policy Options Initially Considered and Subsidiarity...................................... 19 
5. Achieving Simpler and Better Regulation ................................................................. 20  
5.1. Clarifying and simplifying the Regulation................................................................. 20 5.1.1.  Definition and Drivers of the Problem....................................................................... 20  
5.1.2.  Description of Options ............................................................................................... 20  
5.1.3.  Impact Analysis.......................................................................................................... 21  
5.1.4.  Comparison of the Options and Emerging Preferences ............................................. 22  
5.2. Streamlining of Reporting and Reducing th e Associated Administrative Burden .... 22 
5.2.1.  Definition and Drivers of the Problem....................................................................... 22  
5.2.2.  Description of Options ............................................................................................... 23  
 
EN 4   EN 5.2.3.  Impact Analysis.......................................................................................................... 24  
5.2.4.  Comparison of the Options and Emerging Preferences ............................................. 25  
5.3. Updating Exemption Regimes and Rela ted Administrative Processes...................... 26 
5.3.1.  Definition and Drivers of the Problem....................................................................... 26  
5.3.2.  Description of Options ............................................................................................... 27  
5.3.3.  Impact Analysis.......................................................................................................... 28  
5.3.4.  Comparison of the Options and Emerging Preferences ............................................. 30  
6. Ensuring Continued Compliance with the Montreal Protocol ..................................... 6  
6.1. Implementing Decision XIX/6 on the accelerated phase out  of HCFCs ................... 31 
6.1.1.  Definition and Drivers of the Problem....................................................................... 31  
6.1.2.  Description of Options ............................................................................................... 31  
6.1.3.  Impact Analysis.......................................................................................................... 31  
6.1.4.  Comparison of the Options and Emerging Preferences ............................................. 32  
6.2. Adapting the phasing out of  the use of HCFCs.......................................................... 33 
6.2.1.  Definition and Drivers of the Problem....................................................................... 33  
6.2.2.  Description of Options ............................................................................................... 33  
6.2.3.  Impact Analysis.......................................................................................................... 34  
6.2.4.  Comparison of the Options and Emerging Preferences ............................................. 35  
6.3. Options for Strengthening Enforcement of the Regulation........................................ 36 6.3.1.  Definition and Drivers of the Problem....................................................................... 36  
6.3.2.  Description of Options ............................................................................................... 36  
6.3.3.  Impact Analysis.......................................................................................................... 37  
6.3.4.  Comparison of the Options and Emerging Preferences ............................................. 38  
6.4. Options for Avoiding Illegal Imports  and Closing Remaining Loopholes................ 39 
6.4.1.  Problem definition and Drivers.................................................................................. 39  
6.4.2.  Description of Options ............................................................................................... 39  
6.4.3.  Impact Analysis.......................................................................................................... 40  
6.4.4.  Comparison of the Options and Emerging Preferences ............................................. 41  
6.5. Options for Avoiding Exports Harming the Phase Out in Destination Countries ..... 41 
6.5.1.  Problem definition and Drivers.................................................................................. 41  
6.5.2.  Description of Options ............................................................................................... 42  
6.5.3.  Impact Analysis.......................................................................................................... 43  
6.5.4.  Comparison of the Options and Emerging Preferences ............................................. 44  
7. Ensuring future challenges are being addressed ........................................................ 45  
7.1. Avoiding Emissions of ODS "Banke d" in Products and Equipment......................... 45 
 
EN 5   EN 7.1.1.  Definition and Drivers of the Problem....................................................................... 45  
7.1.2.  Description of Options ............................................................................................... 47  
7.1.3.  Impact Analysis.......................................................................................................... 49  
7.1.4.  Comparison of the Options and Emerging Preferences ............................................. 49  
7.2. Avoiding the Marketing of New and Short-lived ODS ............................................. 50 
7.2.1.  Definition and Drivers of the Problem....................................................................... 50  
7.2.2.  Description of Options ............................................................................................... 50  
7.2.3.  Impact Analysis.......................................................................................................... 51  
7.2.4.  Comparison of the Options and Emerging Preferences ............................................. 52  
7.3. Avoiding Using Methyl Bromide (MB) fo r Quarantine and Pre-shipment purposes 52 
7.3.1.  Definition and of Drivers of the Problem .................................................................. 52  
7.3.2.  Impact Analysis.......................................................................................................... 54  
7.3.3.  Comparison of the Options and Emerging Preferences ............................................. 55  
8. Monitoring and Evaluation ........................................................................................ 56  
9. Summary and Conclusions......................................................................................... 56  
Appendix I –Glossary........................................................................................................... .... 59  
Appendix II –Key Principles and Featur es of Regulation (EC) N° 2037/2000 ....................... 63  
Appendix III –The 2010 Outlook Regarding Contro lled Ozone Depleting Substances in the 
EU –the Baseline for Finishing the Job...................................................................... 64  
Appendix IV –Methods and Criteria For Assessing the Impacts............................................. 69  
Appendix V –Stakeholders' Suggested Areas for Further Improvement ................................. 70  
Appendix VI –List of options c onsidered and their impacts.................................................... 72  
Appendix VII –Comments from the Impact Assessment Board.............................................. 77
 
EN 6   EN 1. INTRODUCTION  
Context and Legal Basis  
The European Institutions' commitment to better regulation, combined with the EU's 
20 years' experience in pr otecting the ozone layer, have delivered a timely 
opportunity to review the Regulation (EC)  N° 2037/2000 on substances that deplete 
the ozone layer (hereaf ter "the Regulation").1  
The preparations for this review furthermore coincided with the 20th Anniversary of 
the Montreal Protocol, which was cel ebrated in the margins of the 19th Meeting of 
the Parties in 2007 in Montreal, and which offered ample opportunities for analysis 
and reflection on experience to date and on options for future improvements to the 
policy and legislative framework th at protects the ozone layer.  
As the revised Regulation will pursue the objective to preserve, protect and improve 
the quality of the environment and to ensure  the EU's compliance with its obligations 
under an international agreement dealing with a worldwide environmental problem, it is appropriate to maintain Article 1 75(1) of the EC Treat y as legal basis. 
Expert and Stakeholder Consultations 
 
Preparations for the review of the regulat ion started at the end of 2006 when the 
Commission contracted a cons ortium of independent expe rts to conduct a review 
study following a competitive tender procedure.2 Throughout the study, due 
opportunities were provided for broa d stakeholder consultation.  
An advisory group was established comprisi ng representatives from Member States' 
National Authorities, other relevant agen cies, companies and i ndustry associations, 
and non-governmental organisations. Advi sory Group meetings on 10 July and 7 
November 2007 were well attended and offere d stakeholders an opportunity to share 
experiences and expertise and to comment on draft reports circulated in advance by 
the experts contracted by the Commission.  
The review study was based upon an extensiv e stakeholder survey conducted during 
the first half of 2007. The survey revealed general satisfaction with the Regulation's 
effectiveness and cost-efficiency. It also  helped identify a number of areas for 
improvement, notably related to reducing the Regulation's complexity. A summary 
of suggested changes is included in Appendix V.  
The survey and other relevant reports (incl uding the latest Reports of the Montreal 
Protocol's Scientific Assessment Pa nel (SAP) and Technical and Economic 
Assessment Panel (TEAP)) s ubsequently helped inform the development of 
proposals for a revised regulation, incl uding potential non-regulatory options. 
Proposals for changes were short-listed, base d on preliminary feasibility and impact 
assessments and a set of recommended opti ons was presented for consideration by 
the Commission. The final study was publis hed on the Commission's website in 
                                                 
1 The present review is included in the 2008 CLWP under the “Simplification Heading”. 
2 Contract 07010401/2006/454578/MAR/C4 entitled “Review of the implementation of Regulation EC 
N° 2037/2000 on substances that deplete the ozone layer” awarded to Milieu Ltd and Ecosphere Ltd. 
 
EN 7   EN January 2008.3 Stakeholders were then offered another opportunity to comment on 
the final report.  
The review study and stakeholders' comment s served as key inputs for the present 
impact assessment and the pr oposed review of the Regula tion as contained in this 
report. The external study was compleme nted by in-house environmental and socio-
economic analysis (in accordance with th e applicable Commission guidelines for 
conducting regulatory impact assessments), fu rther detailing the potential costs and 
benefits of the recommended options in te rms of administrative burden and direct 
economic costs. 
Key stakeholders were kept informed  through existing consultation platforms 
dedicated to ozone protection policy areas (such as Meetings of the Management 
Committee established by Article 18 of th e Regulation; the Ma rch 2007 Meeting of 
the Industry Group on Protection of the Oz one Layer (IGPOL), and the April 2008 
Meeting of the Environmental Policy Review Group comprising all Director 
Generals from Member States Environment Ministries). 
In parallel with the stakeholders' advisory  group, an inter-service group was formed 
for the purpose of validating review  options within the Commission.  
Comments from the Impact Assessment Board  
A draft of this report was submitted to the Commission’s Impact Assessment Board 
on 30 April 2008. The draft impact assessment was presented and discussed at the 21 
May 2008 meeting of the Impact Assessm ent Board. On 27 May 2008, the Impact 
Assessment Board issued its opinion whic h is reproduced in Appendix VII. All 
recommendations for improvements have been  accounted for in the final version of 
this impact assessment, as described in Appendix VII.  
Inter-Service Consultation  
All services consulted (S G, SJ, ENTR, AGRI, ECFIN, TREN, RTD, SANCO, 
MARKT, TRADE, JRC, COMM, COMP, TAXUD) agreed to the proposed 
documents. Inter-service consultation reveal ed that entry of goods into the customs 
territory was not only to include those for release for free circulation in the Community and transhipment, but also  those entering under other customs 
procedures or for customs-approved treatm ents and uses. Option 3 in section 6.4.2 
was adapted accordingly.  
2. P
OLICY BACKGROUND  
2.1. The Montreal Protocol –From Environmen tal Pioneering to Hailed Multilateral 
Environmental Agreement in 20 Years 
The stratospheric ozone layer provides a shield protecting life on earth from harmful 
ultraviolet radiation from the sun. In 1974, scientists predicted that emissions of 
certain man-made ODS might be depl eting the ozone. During the early 1980s, 
scientists observed a very significant decrease in the concentration of ozone in the stratosphere over the Antarctic, which b ecame widely known as the "ozone hole". At 
its peak – in the late 1990s – the ozone hole was most severe around the poles in 
                                                
 
3 http://ec.europa.eu/enviro nment/ozone/review.htm. 
 
EN 8   EN spring time, although ozone concentrations were significantly reduced in other places 
as well. Increases in levels of UV radiation have caused adverse impacts on human life, primarily in terms of increased inci dences of skin cancers and cataracts and 
ecosystems. 
In 1985, Governments agreed upon the Vienna Convention for Protecting the Ozone 
Layer and thus committed to international cooperation to prevent harm from damage 
to the ozone layer. As soon as 1987, G overnments proceeded to establish the 
Montreal Protocol on Substances that De plete the Ozone Layer, thereby mandating 
the phase-out of production of ODS by all si gnatory Parties accord ing to a specific 
time-table.  
Since 1987, and following further scientific ev idence, the Montreal Protocol has been 
amended five times to include additional ODS and accelerate production phase-out time tables. Table 1
 provides a summary of the ODS currently incorporated 
("controlled") in the Montreal Protocol and their common uses.  
Table 1 : Common Ozone Depleting S ubstances and Their Uses 
Substance Most Common Uses ODP4 
Chlorofluorocarbons (CFCs) 
 Refrigerants; cleaning solvents; aerosol propellants;  
foam blowing agents. 0.6 – 1.0 
Halons Fire extinguishants; explosion suppressants. 3 – 10 
Carbon tetrachloride, CCl 4 
(CTC) Feedstock chemical in CFC production; cleaning and 
industrial solvent. 1.1 
Methyl chloroform, CHCl 3 
(TCA) Industrial solvent for cleaning, inks, correction fluid. 0.1 
MB, CH 3Br (MB) 
 Fumigant for control of soil-borne pests and diseases in 
crops and stored commodities. 0.6 
Hydrochlorofluorocarbons 
(HCFCs) Refrigerants; cleaning solvents; foam blowing agents; 
fire extinguishants. 0.01 – 0.5 
In 2007, as the Parties celebrated the Mont real Protocol's 20th Anniversary the 
Protocol was widely hailed as one of th e most successful of  all international 
environmental agreements.5  
Figure 1  illustrates how successful the Prot ocol has been in reducing global 
consumption and production up until the pe riod ending 2005. By then, all 191 Parties 
had achieved a 95 percent reduction in th e consumption of ODS compared to 
established baselines. Reductions are hi ghest (99.2 percent) in industrialized 
countries, and somewhat lower (80 per cent) in developing countries. These 
reductions were achieved on the basis of ag reed consumption and production freezes 
and subsequent time-bound stepped reductions.6 
                                                 
4 Note: The ODP is the ratio of a chemical's impact on the ozone layer compared to that of a similar mass 
of CFC-11, which is set to 1.0. 
5 It is worth noting that the ability to focus on phasing out the tangible production and consumption of the 
ODS, rather that targeting emissions is by many  considered a key featur e of the success of the 
regulatory framework (both at international and EU level). 
6 Successful reductions in developing countries we re made possible by the Multi-Lateral Fund which has 
to date channelled about US$ 2.2 billion to technolo gy transfer and related capacity building projects in 
developing countries. 
 
EN 9   EN Figure 1 : Global Phase Out of Controlled ODS under the Montreal Protocol (ODP tonnes) 
0200.000400.000600.000800.0001.000.0001.200.0001.400.0001.600.0001.800.0002.000.000
1986* 1989* 1992* 1995 1998 2001 2004Consumption
Production
 
As of 2010, production and consumption of  the most harmful (known) ODS should 
be completely banned in industrialized count ries, except for a very limited number of 
exempted or non-controlled uses and a re ducing "tail" of hydrofluorocarbons. Full 
bans in developing countries typically co me into effect within 5 to 10 years 
following the bans in industrialized countries , although that an increasing number of 
developing countries now ali gn their policies with industr ialized countries such as 
those of the EU. 
A key feature of the success of the regulat ory framework (both at international and 
EU level) is its focus on phasing out th e tangible production and consumption of the 
ODS, rather that targeting emissions.  
The Scientific Assessment Panel (SAP), in its latest Report released in 2007, 
confirmed that the ozone laye r is slowly recovering thanks  to the control measures 
introduced by the Protocol – albeit with a 10-15 year s delay compared to the 
projections in its earlier 2002 Report. Global average ozone  and Arctic ozone levels 
are expected to return to pre-1980 levels  by 2050 whilst the Antarctic ozone hole is 
expected to return to pre-industr ial levels by the 2065-2075 timeframe. 
Following the causal relationship between in creased exposure to UV-B (due to the 
depleted ozone layer) and adve rse health impacts such as ca taract or skin cancer, the 
risks related to the occurrence of these he alth impacts will significantly decrease in 
future. According to UNEP, controls impl emented under the Montreal Protocol will 
enable the global community to avoid millions of fatal skin cancers and tens of millions of non-fatal skin cancers and cataracts. The United States' authorities estimate that more than 6.3 million skin cance rs will have been avoided in the US 
alone and that efforts to protect the oz one layer will have saved 4.2 trillion U.S. 
dollars in health care costs over the period 1990-2165.
7 8 9 
                                                 
7 The Benefits and Costs of the Clean Air Act, 1 990-2010. Environmental Protection Agency; Office of 
Air and Radiation. November 1999. EPA 4W-R-99-001. 
 
EN 10   EN Controls implemented under the Montreal Protocol have furthermore delivered 
substantial climate benefits. That is b ecause most ODS have a very high Global 
Warming Potential (GWP) as  indicated in Table 2 . 
Table 2 : Global Warming Potentia ls of the controlled ODS 
Substance GWP10 
Chlorofluorocarbons (CFCs) 4,750 – 14,420 
Halons 404 – 7,140 
Carbon tetrachloride, CCl 4 (CTC) 1,400 
Methyl chloroform, CHCl 3 (TCA) 146 
MB, CH 3Br (MB) 5 
Hydrochlorofluorocarbons (HCFCs) 77 – 2,310 
Source: Scientific Assessment of Ozone Depletion: 2006, WMO, 2007 
Unmitigated, ODS-related GHG emissions coul d have been as much of a concern 
today as global CO 2 emissions. The Montreal Protoc ol phase-out schedules have 
helped avoiding the emission of greenhous e gases equivalent to more than 100 
billion tons CO 2 between 1990 and 2010. By 2010, GW P-weighted ODS emissions 
will account for less than 5% of global projected CO 2 emissions whereas they 
accounted for nearly 50% of global CO 2 emissions in 1990. On top of this, the 
Montreal Protocol decision of the Se ptember 2007 Meeting of the Parties to 
strengthen further the HCFC phase-out will potentially reduce emissions by an 
additional 18 billion tons of CO2-equiva lent by 2030 corresponding to about 60% of 
current global annual CO2 emissions. Comb ined voluntary and national efforts to 
phase out ODS before the MP started, and the mandatory efforts under the Protocol, 
have succeeded in delaying the overal l growth in greenhouse gas levels by a 
significant 7-12 years.11 
2.2. Remaining Global Challenges Related to Recovery of the Ozone Layer 
Despite the significant successes achieved to date, the 2006 SAP Report clearly 
stated that the global community continue s to face significant challenges if the 
projected schedule for the recovery of th e ozone layer is to be achieved. The SAP 
and Technical and Economic Assessment Pane l reports released in 2007 stated that 
the anticipated recovery of the ozone la yer critically depend s on Parties accounting 
for the key issues listed below: 
                                                                                                                                                         
8 Key Achievements of the Montreal Protocol to date, UNEP Fact Sheet, 2007. 
9 The occurrence of skin cancers in mid-latitude developing countries has nevertheless increased over the 
last two decades due also to other factors such as the aging of population and the increased exposure to 
UV-B radiation due to changing life styles. 
10 Global warming potential (GWP) is the ratio of th e warming caused by a substance compared to the 
warming caused by a similar mass of carbon dioxide. The GWP of carbon dioxide is 1.0. 
11 G.J. Velders et al., The importance of the Montreal Protocol in protecting climate , Proc. Nat. Acad. Sci, 
2007, 10.1073/pnas.0610328104. 
 
EN 11   EN (1) Failure to comply with the Montreal Protocol would delay, or could even 
prevent, recovery of the ozone layer.   
 
Emissions associated with continue d or expanded exemptions under the 
Montreal Protocol could delay or even prevent achieving the projected 
recovery of the ozone laye r. For example, critical use exemptions allowing 
production of MB in 2005 and 2006, and c ontinued use of MB for quarantine 
and pre-shipment (QPS) purposes would, if they were to continue indefinitely 
at the 2006 levels, result in an increase in  stratospheric chlorine levels at mid-
latitude, thereby delaying recovery of the ozone layer. SA P finally suggested 
that Parties should also to monitor ODS  emissions from other exempted uses, 
related to their use as fe edstock and process agents. 
(2) Alarming growth of HCFC producti on and consumption in developing 
countries.   
 
New projections for the recovery of th e ozone layer assume action is taken by 
Parties to stem the alarming growth of HCFC production and consumption in 
developing countries. HCFCs had been phase d in as a transitional alternatives 
to CFCs in some sectors even though they still have significant (but lower 
than CFC) ODP characteristics. Wh ilst developed countries are well 
advanced in the phase out of HC FCs, production and consumption in 
developing countries were projected to double from their current levels 
(similar to current yet decreasing levels in developed countries).12 
 Parties have moved swiftly by adopti ng Decision XIX/6 on the early phase-
out of HCFCs less than a year after the publication of the SAP report. The 
Decision commits developed countries, including the EC, to bring forward 
the full phase out of HCFC production from 2025 to 2020.  
(3) Significant ODS contained or "banked" in products and equipment. 
 
Because the Protocol has focused on the reduction and ultimate elimination of 
ODS production rather than on control ling use, there remain significant 
quantities of ODS containe d in products such as building insulation foams 
and in refrigeration and air conditioni ng equipment. A failure to recover, 
recycle, and ultimately destroy these ODS at the end of the useful life of the 
products or equipment concerned poses a risk to maintaining the progress achieved in phasing out ODS as well as to global warming.   TEAP estimated that, in 2005, 3.5 million ODP tonnes of ODS were contained in equipment and products and, as such, ODS banks present the 
second most significant threat (after pot ential growth of HCFCs consumption 
in A5 countries) towards early recovery of the ozone layer. Recovery of ODS 
from the banks also presents an oppor tunity. Considering the significant GWP 
characteristics of CFCs and other "ba nked" ODS, these banks also represent a 
significant climate change issue, i.e. containing over greenhouse gases 
equivalent to over 2 billion tonnes of CO
2. 
                                                 
12 Based on latest available date for 2005, they repr esented about 60 percent of the remaining substances 
in developed countries with over all quantities steadily decreasing.  
 
EN 12   EN (4) The role of very short-lived substances in ozone depletion is of greater 
importance than previously assessed.  
It is now believed that very short-liv ed halogenated subs tances such as 
normal-propyl bromide (n-PB), which is  almost exclusively anthropogenic, 
significantly contribute to total stra tospheric bromine and thus have an 
adverse effect on stratospheric ozone.
13 The TEAP's n-PB Task Force 
informed Parties in 2001 that n-PB is being aggressively marketed for solvent 
applications which traditionally us ed ODS and non-ODS. Production of n-PB 
is a rather simple process allowing it to be economically produced in both 
developed and developing countries. He nce, annual production could easily 
increase significantly over the next few years if no preventative measures 
were taken. Technically and economically feasible alternatives that are environmentally superior to n-PB are av ailable for almost all its applications 
– in solvents, as a feedstock and as a carrier and intermediate for 
pharmaceutical and other industries.  
(5) Understanding the interconnections be tween ozone depletion and climate 
change is crucial for projecti ons of future ozone abundances. 
 
By the middle of the 21st century, quant ities of the ODS in the stratosphere 
are expected to have fallen to thos e present in 1980 before the onset of 
significant ozone depletion. However, cl imate and other atmospheric factors 
will not be the same in 2050 as in  1980, and this could cause ozone 
abundances in 2050 to be somewhat di fferent from those observed in 1980. 
At high latitudes, the stratospheric te mperature cooling related to climate 
change tends to delay the recovery of  the ozone layer. In mid-latitudes 
however, the recovery is somewhat accelerated by the changes in the 
temperature in the upper atmosphere. Hence, projections of the recovery of the ozone layer remain un certain and further delay in the recovery of the 
ozone layer because of climat e change cannot be excluded.  
At the 19th Meeting of the Parties held in 2007, the above challenges were 
recognised by the EU Member States a nd the Commission. Hence they are duly 
accounted for in the problem definition outlined below.  
2.3. Regulation (EC) N° 2037/2000 on Substances that Deplete the Ozone Layer –
Leading the Montreal Protocol Implementation 
The Regulation is the Community's main in strument for implementing the provisions 
of the Montreal Protocol. The closel y matching and mutually reinforcing 
international and EU policy framework has lead to an impressive track record, with a near complete phase out of production and consumption of the controlled ODS (See 
appendix II for specific features).  
As shown in Figure 2
, ODS production and consumption in the EU have decreased 
by more than 99 percent compared to baseline levels. 
                                                 
13 SAP confirmed the ODP for n-PB to be 0.1 for tropical emissions and 0.02-0.03 for emissions in 
northern mid-latitudes in its 2006 Report.  
 
EN 13   EN Figure 2 : Trends in EU ODS Production and Consumption 1987-2006 
EU ODS Production and Consumption (Baseline till 2006)
-1000000100000200000300000400000500000600000700000
Baseline1986 1989
1990
1991 1992
1993 1994 1995
1996 1997 1998
1999
2000 2001
2002 2003 2004
2005 2006ODP TonnesConsumption
Production
  
The survey conducted in support of the review showed a general stakeholder 
satisfaction with the effec tiveness of the Regulation. Li kewise, stakeholders have 
generally appreciated the effi ciency of the Regulation, notab ly the fact that it allowed 
markets to adapt whilst keeping the overall  administrative burden under control.  
Table 3  summarizes the key characterist ics of the Regulation, building on 
stakeholder's comments in terms of its  strengths, weaknesses, opportunities and 
threats – a SWOT analysis. 
The near-complete phase out in ODS produc tion and consumption has not lead to 
any material market disruption in the EU or  globally. Following the provisions of the 
Montreal Protocol, the stag ed phase-out approach embedded in the Regulation has 
offered a clear perspective for markets (both producers and consumers) allowing 
them gradually to adapt without causi ng major market disruptions. Where the 
Regulation has banned ODS pr oduction, a series of exemp tions for critical and 
essential uses has been allowed in line w ith the provisions of the Montreal Protocol 
and associated Decisions of the Parties.14  
These exemption regimes have allowed for a (controlled) grace period for the more 
difficult and costly phase out areas and fo rmed one of the Regulation's efficiency 
features.15 In the areas where the Regulation went beyond the provisions of the 
Montreal Protocol, such as where it establ ished use bans on equipment that contained 
or relied upon HCFCs, cost-efficiency  was achieved through progressive 
introduction of use bans by date and s ector. The use of HC FCs in products and 
equipment for which alternatives were read ily available was banned first, and longer 
phase out schedules were applie d to more difficult sectors.  
                                                 
14 Decisions of the Parties have generally establishe d two key criteria concerning critical and essential 
uses, i.e. (1) the importance of the use, and (2) the lack of availability of technically and economically 
feasible alternatives. 
15 Before 2010, the two most important exemption regimes provided for in the Regulation will have 
ended: essential uses for metered dose inhalers (MDI) and critical uses of MB. The remaining 
exemption regimes are currently under review.  
 
EN 14   EN Table 3 : A SWOT Analysis – Build ing on 20 Years' Experience.  
Strengths Weaknesses 
• Effective  policy framework 
• Near complete phase out of production 
of controlled ODS  
• Clear evidence of decreasing ODS 
levels in the atmosphere 
• Prospects of ozone layer recovery 
between 2050-75 
• Significant indirect environmental 
benefits (climate change) 
• Efficient  policy framework 
• Staged phase-out regimes 
• Post-phase out exemption regimes  
• On-line ODS licensing  and other 
efficiency features • Complex  Regulation 
• Rigid  quota and licensing procedures 
• Extensive  reporting requirements 
• Lack  of Synergies with other EC policies  
Opportunities Threats 
• Advancing the progress of ODS phase-out  
• Critical use of MB 
• Essential use of CFCs for Metered 
Dose Inhalers (MDIs) 
• Essential laboratory and analytical uses 
• Critical uses of halons 
• HCFC Production 
• New Scientific Assessment & TEAP Reports 
(2006) 
• Better understanding of (short-lived) 
ODS impacts 
• Better understanding of ozone & 
climate change links 
• New data on ODS/GHG "Banks" 
• Updated risk assessment related to 
ozone layer recovery  
• Dialogue on the future of the MP   
 • Emissions from "non-controlled" ODS use 
• Banks 
• QPS 
• New and short-lived ODS 
• Feedstock Use 
• Illegal and Harmful  Trade  
• Climate change  impacts on ozone layer recovery  
• Fading Commitment  to Remaining Phase-Out  
• Growth of HCFC use in Developing 
Countries 
• Slowing reduction in phasing out ODS 
essential/critical uses 
• Fading R&D prioritization and donor 
attention 
 
Whilst this flexibility has imposed (often significant) administrative costs on 
Member States' authorities, including th eir customs agencies, the Commission, and 
the companies benefiting from the flexible arrangements, these costs have generally come down as the number of exempti ons requested and granted has reduced.
16 
The staged phase-out regimes have furtherm ore served as instrumental in driving 
innovation and the development and market ing of new, more environmentally 
friendly, products, equipment and processe s that no longer cont ain or rely on ODS.17  
3. GENERAL PROBLEM DEFINITION AND OBJECTIVES  
3.1. Defining the Remaining Problems to be  Tackled in the EU Based on the 2010 
Outlook 
By 2010, the EC will have re ached a full phase-out of controlled ODS, save for 
approximately 1 200 ODP tonnes p.a. (See fi gure 3 below). The amount of 1 200 
                                                 
16 The bulk of these costs have gone to the management of the procedures for these exemptions. For 
example, an analysis indicates that the ODS Mana gement Committee spends about one-half of its 
meeting time discussing these exemptions, including issues not clearly defined in the Regulation Estimate based on an analysis of the minutes of Management Committee meetings in 2005 and 2006. 
17 For examples of applications that historically relied on ODS and where non-ODS solutions were 
developed and adopted by the markets see: http://ec.europa.eu/environment/ozone/alternatives.htm. 
 
EN 15   EN ODP tonnes compares to baseline cons umption levels of 400 000 ODP tonnes and 
includes an estimated 1 000 ODP  tonnes of recycled or reclaimed HCFCs which will 
be banned as of 2015, thus leaving a tail of less than 200 ODP tonnes p.a. of ODS 
"consumption" as defined by the Montreal Protocol. In addition,  there will be a 
remaining use of "emissive ODS uses" that  are covered by the regulation (yet not 
accounted for as consumpti on under the Protocol) amounti ng to an estimated 1 400 
ODP tonnes for the period beyond 2010 (assumi ng that current levels would be 
maintained in the absence of further meas ures). ODS production in the EC will have 
reached less than 4 000 ODP tonnes p.a. by 2010 (comparing to baseline production 
levels of 700 000 ODP tonnes). Further de tails on the 2010 outl ook are provided in 
Appendix III.  
Figure 3 : Remaining Emissive Uses of the ODS in the EU (Base Case Estimates for 
the period ending in 2020) 
05001.0001.5002.0002.5003.000
2008 2009 2010 2015 2020ODP-Tonnes p.a.
Essential Use CFC-MDI Critical Use MB Essential Use Laboratory & Analytical
Use of HCFC (virgin) Use of HCFC (recycled or reclaimed)*
 
Considering the international context de scribed in section 2.2, the 2010 outlook and 
stakeholders' suggestions for improvement (Appendix V ), the following remaining 
problem areas have been defined: 
(1) Regulatory and Associated Administrative Complexity 
 
The administrative costs incurred by users in interpreting the legal text, if 
current complexities remained, are estimated at €5.6 million over the period 2010-2020, including €5.4 million for EU i ndustry, particularly SMEs. There 
is a need for simplification and clarif ication of the Regulation's structure, 
inter alia by removing obs olete provisions, for exam ple those related to the 
phase out steps before 2010. Current reporting requirements, if they were to continue up over the period considered, would amount to €2.48 million overall in terms of administrative costs, including €1.5 million falling upon 
Member States. In addition, the overa ll administrative costs related to 
exemption regimes in case of no ac tion would be €1.3 million over the whole 
period. Measures to reduce administra tive costs are therefore required, 
notably related to reporting. Synergie s with related policies such as the 
regulations on fluorinated greenhouse gases, waste, chemicals and plant 
protection should be better exploite d. The quota and licensing procedures 
need to remain flexible.  
 
EN 16   EN (2) Full compliance with the Montreal Protocol, as adjusted, and risk of 
illegal trade  
To address the global growth of HC FC production and consumption, Parties 
adopted Decision XIX/6 on an early pha se-out of HCFCs. The Regulation 
must as a minimum option be realigne d with the Decision to bring forward 
the production phase-out of HCFCs fr om 2025, as currently provided for in 
the Regulation, to 2020.
18In addition, the upcoming pha se-out of the use of 
“virgin” HCFCs for the maintenance a nd servicing of refrigeration and air 
conditioning equipment, and the related di fficulties in verifying the source of 
the HCFC potentially fuelling illegal trade in virgin HCFCs are also of 
concern. As a comparison, during th e CFC phase out in the 1990s, an 
estimated 15.000 ODP tonnes p.a. were tr aded illegally during the period 
1994-96. Stronger enforcement of import and export requirements across the 
EC is required.  
(3) Uncontrolled ODS production and trade, and ODS banked in products 
and equipment 
 
Introducing measures for currently uncontrolled ODS production and trade 
(notably new ODS and methyl bromide uses for Quarantine and Pre-
Shipment purposes) and to ensure recove ry and destruction of ODS banked in 
products and equipment must be cons idered. Annual emissions from ODS 
banks are estimated to be in the range of 17 000-24 000 ODP tonnes in the EU (compared to 180 000 globally). Emissions over the period 2010-2020 
would add up to 200 000 tonnes. The pr oduction of new and short-lived ODS 
is projected to be up to 20 600 ODP tonnes over the whole period. The annual 
use of methyl bromide to QPS is cu rrently 200 ODP tonnes (10 000 globally), 
which would amount to 2000 ODP tonnes over the full period considered. 
In addressing the above mentioned probl ems, due account will be given to their 
drivers, notably that remaining ODS rema in profitable for producers and consumers 
albeit that technically viable alternatives are available to date for all but a few ODS 
uses. 
3.2. General and Specific Objectives 
The general long-term objective pursued  during the review remains the timely 
recovery and subsequent protection of th e ozone layer to avoid adverse impacts, 
notably on human health and ecosystems. The associated short and medium-term objective, however, is to simplify the regulatory framework, whilst at the 
same time reducing any unnecessary admi nistrative burden, in line with the 
Commission’s commitment to develo p and implement better regulation.
19  
                                                 
18 This also followed consultations with EU industry and Member States who endorsed the EC position. 
19 It is noted that jointly pursuing the long-term and short/medium term objectives implies that major 
revisions of the regulation that would lead to a subs tantial deviation from the current regulation were to 
be avoided (notably related to definitions which stem from the Protocol), unless there was an overriding argument to do so. It implies also, that a review in  the context of a simplification exercise is not to 
exclude the consideration of selective measured stre ngthening provisions that are required to enabling 
the EU to adapting to remaining challenges.  
 
EN 17   EN In order to deliver th ese general objectives, specific objectives  were identified, 
addressing all problems outlined above whilst building on the strengths and 
opportunities identified in the SWOT analysis. Th ese objectives, list ed in order of 
priority, include: 
(1) Achieving better and simpler regulati on by reducing the administrative 
burden 
(a) Clarifying and simplifying the Regulation 
(b) Streamlining reporting and associ ated administrative burden 
(c) Updating exemption regimes and asso ciated administrative processes 
(2) Ensuring continued compliance thro ugh full implementation of the 
Montreal Protocol as adapted in 2007 and strengthened enforcement 
(a) Implementing Decision XIX/6 on th e advanced HCFC phase out 
(b) Ensuring EC compliance status an d preventing illegal and harmful 
trade  
(3) Addressing future challenges by tackling ODS not yet controlled under 
the Montreal Protocol 
(a) ODS contained (or "banked") in products and equipment 
(b) New and Short-lived ODS 
(c) MB Use for Quarantine and Pre-Shipment Purposes 
3.3. Method and Criteria for Assessing the Impacts 
The methodology recommended by the impact  assessment guidelines was adopted 
for the purpose of conducting this review.20  
The impacts of the different policy options were considered according to the three 
general impact assessment criteria recomm ended by the guidelines: economic, social 
and environmental impacts. Within thes e three impact categories, 16 specific 
categories were identified based on an initial review of the options and of the information and comments gath ered during the review study.  
Details of the assessments and the crite ria used are provided in Appendix IV
 and can 
be found in the study commissioned to  support this impact assessment.21 
Since this Review takes place in the cont ext of the 'Better Regulation' initiative, 
special emphasis was put on the evaluation of  the impact of proposed policy options 
on administrative costs, using th e EU standard cost model. 
Direct economic impacts were approxim ated using forgone profit margins. 
Impacts in terms of administrative costs a nd direct economic impacts for the period 
until 2020 have been stated in terms of Net Present Value (NPV) in the year of 2010, using a 4 percent discount rate. 
Environmental benefits were quantified in terms of saved ODP tonnes when feasible. 
Final impacts in terms of reduced probabil ity of skin cancer a nd cataract, increased 
                                                
 
20 Reference to IA Guidelines 
21 See http://ec.europa.eu/en vironment/ozone/review.htm 
 
EN 18   EN crop and fisheries productiv ity thanks to reduced exposure to UV-B could in 
principle be monetised. This was not deemed useful for two main reasons: 
• a full cost-benefit analysis would not be  proportional to the problem as the 
benefits (as well as the costs) are expected  to be small since we are now at the tail-
end of the problem. Monetising the benef its would be time-consuming and would 
be unlikely to change the decision process; 
• the exercise would not be meaningful as  formation and depletion of the ozone 
layer are governed by long-term processes, and attempting to link an annual net 
gain in a unit ODP tonne to global pro cesses and final human and environmental 
health impacts is an extremely difficult tas k. The final figure is likely to be well 
within the error margin. A cost-benefit an alysis of limiting emissions of ODS was 
undertaken for by the US Environmental Protection analysis for the period 1990-
2175, based on dose-response models. The same study however underlined that estimating incremental effects of a re duction in emissions of ODS was an 
'extremely difficult, if not impossible, task'.
22 The same rationale applies to the 
small quantities and time frame considered here. 
In some cases, full quantification was not possible because of lack of data, or 
because the magnitude of the impact wa s difficult to assess ex ante (e.g. the 
environmental impact of strengthened insp ection or labelling provisions). A scale 
was used where (detailed) impacts were la rgely unquantified, i.e. "+" or "-" referring 
to environmental impacts of less than 1 000 ODP tonnes and "++" or "- - " for impacts over this threshold. Likewise, the same scale was used for economic impacts 
below or in excess of €1 000 000.  
3.4. Who may be affected?  
The risk of a delay in the recovery of the ozone layer concerns all EU citizens and 
indeed the global population. 
The current complexity of the Regulation a nd the related administ rative burden affect 
the Commission, Member States, and industr y, particularly SMEs which tend to be 
more affected. Considering th at the review takes place at  the tail-end of the ODS 
policy problem, there remain relatively few st akeholders that are directly affected by 
the present Regulation.  
For example, there remain only 16 pr oducers of ODS, most of which are 
multinational companies. There remain an  equally low number of producers of 
products and equipment that contain or re ly upon ODS, mostly the manufacturers of 
refrigeration, air conditioning and heat  pump system and producers of insulation 
foams. Whilst these are also mainly multi-na tional companies, associated installation 
and servicing companies tend to be mostly SMEs.  
There are a limited number of users of ODS is specialist sectors such as research, 
defence and aerospace 
The main stakeholders potentially affected  by the revision to the Regulation have 
been identified, as well as the areas where options are most likely to affect them. All 
relevant stakeholders have been in vited to participate in the review. 
                                                
 
22 The Benefits and Costs of the Clean Air Act, 1 990-2010. Environmental Protection Agency; Office of 
Air and Radiation. November 1999. EPA 4W-R-99-001, p G-1. 
 
EN 19   EN 4. DEVELOPING VIABLE POLICY OPTIONS  
4.1. Maintaining the Business as Usual Scenario 
The 2010 outlook on the status of ODS in the EU (section 2.3 and Appendix III) 
offers a good indication of the business as usual (BAU) case. 
Maintaining the BAU scenario is attractive at first sight. What is the advantage of 
changing the regulation  if only 1% of the problem re mains? However, it has been 
rejected by stakeholders first and foremo st because it prevents the pursuit of the 
simplification objective and removes any opport unity to reap the associated savings 
in administrative costs. It would also pr event an appropriate EU response to the 
remaining challenges that have been identified (section 3.1).  
Failure to revise the Regulation would also put the EC and its Member States in non-
compliance with the Montreal Protocol, because the adjustment related to the phase out schedules of HCFCs (see section 3.1) would not be transposed into EU laws.  
Whilst some limited progress in ODS phase -out could be expected under BAU 
(because producers and product and equipmen t manufactures and service companies 
would continue to retract from the declin ing ODS sector), net environmental impacts  
are likely to be negative. This is due inter alia  to the fact that illegal trade may not be 
adequately tackled and that opportunities for further reducing ODS use (e.g. reducing 
the cap for QPS) are missed. 
4.2. Withdrawing the Regulation 
The option of withdrawing the Regulati on goes beyond BAU. This option was not 
seen by stakeholders or the Commission as  a valid alternative for obvious reasons, 
not least that the EC and Member States would no longer be able to comply with 
their international commitments under the Montreal Protocol.  
4.3. Towards Simpler and Better Regulation 
Maintaining the BAU scenario or withdraw ing the Regulation are clearly not viable 
options for the reasons explained above. In line with stakeholders' views, there is a 
need for, and opportunities to be gained from, changes to the Regulation in line with the overall and specific objectiv es stated in section 3.2.  
A considerable effort has been made to identify all possible areas for improvement to 
the Regulation. Managing the implementati on of the Regulation has evolved over the 
years into a broad set of processes and a ssociated applications linked to reporting, 
monitoring, information exchanges and enfo rcement. Hence, many opportunities for 
savings are to be found in "non regulatory" options.  
Considering the above, the policy options are described in detail in the remainder of 
the Impact Assessment. The description is  structured according to the specific 
objectives stated in section 3.2. 
4.4. Other Policy Options Initially Considered and Subsidiarity 
Finally, it should be noted that some broa d policy options to reduce the remaining 
uses of ODS have been discarded early in the processes. These include the selective 
use of taxes or other econo mic instruments such as tradable permit systems.  
These options were discarde d because the low remaining level of ODS production 
and use would not warrant the creation of a totally new infrastructure. Furthermore, 
some Member States already use taxes or le vies as an instrument to discourage the 
 
EN 20   EN remaining use of ODS (and to encourage th e adoption of alternatives). Pursuing tax 
measures at the EU level would imply di fficult and time-consuming decision-making 
and would run counter to s ubsidiarity principles.  
5. ACHIEVING SIMPLER AND BETTER REGULATION  
During the consultation, a large number of  Member States and other stakeholders 
underlined their desire for a simpler, clearer  Regulation. Significant efforts went into 
the identification and development of opti ons for achieving this. The insights gained 
by the Commission, Member States' compet ent authorities and industry from 
(almost) ten years' experience with th e current Regulation proved particularly 
valuable in this respect. 
5.1. Clarifying and simplifying the Regulation 
5.1.1.  Definition and Drivers of the Problem 
Many stakeholders commented that the Regulation is unnecessa rily complex, now 
contains numerous obsolete provisions, and requires significant knowledge by the 
reader of the international context because of  a lack of clarity in  definition of terms. 
In several key areas, Member States have different interpretations of the Regulation’s 
provisions23. The different interpretations imply th at businesses may face variation in 
enforcement of the Regulation across the EU. 
5.1.2.  Description of Options  
Option 0 No EU action 
Option 1 Removing obsolete regulatory provisions 
Option 2 Simplifying the structure of the legal text 
Option 3 Improving definitions and links with Montreal Protocol and other 
policies 
Option 4 Removing perceived regula tory uncertainties and loopholes 
Option 0 No EU Action 
Current complexities would remain. A c onservative estimate of the extra time 
required to interpret this Regulation (compared to th e same Regulation drafted 
according to best practice standards) yiel ds a total of about 12 full-time equivalent 
professional staff per year across 500 compan ies. This estimate includes the time that 
EU businesses spend in interpreting the le gal text and by trad e associations in 
supporting their members at EU and national level. The current complexity and lack 
of clarity is felt to be particularly disadva ntageous to SMEs and new entrants to the 
market. The overall administrative costs fo r interpreting the legal text over the period 
2010-2020 would be €5.6 million, including €5.4 million for EU industry, €42 900 
for Member States, and €81 100 for the Commission. 
Option 1  Removing obsolete regulatory provisions  
The progress that has been made in phasing out ODS offers an oppor tunity to remove 
obsolete and expired provisions, especially  related to the produc tion, placing on the 
                                                 
23 One important example is the difference in the inte rpretation of “placing on the market”. Another is 
whether the Regulation requires recovery of MB during QPS use (see section 1.3). 
 
EN 21   EN market and use of CFCs and MB. Articles 3, 4 and 5 would be most affected. For 
example:  
• Article 3(1), second subparagraph, on essent ial uses of CFCs for medical devices 
can be removed because these uses will have become obsolete by 2010; 
• Article 3(1)(ii) on critical uses of MB can  be removed because of new restrictions 
on MB use under biocide a nd pesticide legislation24;  
Option 2 Simplifying the st ructure of the legal text 
Separate chapters would be created fo r the different types of exemption and 
derogation. Linked issues would be  collated into single articles. 
Option 3 Improving defini tions and clarifying links and synergies with the 
Montreal Protocol and other EU policies 
Although stakeholders have called for a clos er alignment of the definitions in the 
Regulation with other EU re gulations, balance is necess ary to ensure that the 
definitions do not deviate unacceptably fr om those contained in the Montreal 
Protocol. Nevertheless, where sensible, definitions would be shortened and realigned 
with other legislation and interpretations  that have develope d in practice. An 
example of the latter would be to replace "placing on the market" with “first placing 
on the market”.  
The introduction of several new annexes w ould improve the Regulation's links to the 
Montreal Protocol and, for example, help  Member States identify and regulate ODS 
destruction technologies that have been approved by the Parties to the Protocol. 
References to the relevant EC legislati on on chemicals and waste would be included. 
Option 4 Removing perceived regulatory uncertainties and loopholes 
Real or perceived regulatory uncertainties would be addr essed throughout the text to 
improve clarity and consistency in the use of terms such as "products and 
equipment". 
5.1.3.  Impact Analysis  
Removing obsolete regulatory provisions, c onsolidating linked issues within single 
articles, and introducing better structured chapters considerably would reduce the 
current complexity of the Regulation. This would facilitate the enforcement of the 
Regulation and help deliver better complia nce. Environmental benefits, whilst not 
directly quantifiable, can therefore be expected.  
Clarifying and simplifying the legal text is expected to reduce costs for industry, the 
Commission and Member States' competent authorities. It should also simplify 
enforcement procedures and thus reduce the costs for other Member State organisations. It is estimated that the options  would save almost half of the estimated 
annual baseline costs for Member States (of € 0.02 million – all estimates are NPV at 2010) and the Commission (€ 0.03 million), and for industry (€ 2.3 million). This 
estimate assumes that a revised regulation w ould require some lear ning effort when 
introduced, with costs estimated to be twi ce the baseline costs in the first year. 
                                                
 
24 A critical use exemption clause will be retained in case of a serious pest outbreak for which MB use is 
deemed necessary  
 
EN 22   EN 5.1.4.  Comparison of the Options and Emerging Preferences 
As "Better Regulation and Simplificati on" is an overarchi ng objective of the 
Commission, the "no-action" option was discarded. All of  the above options would 
be selected to maximise simplification a nd related benefits, wh ich are summarized in 
Table 4 . 
Table 4: Options for clarifyi ng and simplifying the Regulation 
POLICY OPTIONS 
Bold: preferred regulatory option 
Italics: preferred non-regulatory option 
Strikethrough : discarded option 
*option implemented through other EC legislation  
Environmental 
Impacts (ODP 
tonnes) 2010-2020 
Administrative Costs 
(€million) (NPV 2010) 
Direct Economic 
Impacts (€million) 
(NPV 2010) 
Social and Other 
Impacts  
Combined options 1 through 4  0-50 -2.35 0 +1 
Total impacts related to preferred options 0-50 -2.35 0 +1 
1. Reduced burden on SMEs  
A number of other options are described in  the following chapters  which would also 
help simplify the regulation and generate benefits. Whilst they are not duplicated 
here, a reference to these synergies is incl uded in the summary table in appendix VI. 
5.2. Streamlining of Reporting and Reducing the Associated Administrative Burden 
5.2.1.  Definition and Drivers of the Problem 
Several Member States called for measures  to reduce their administrative costs 
related to reporting, indicating that these ar e one of the more burdensome aspects of 
implementing the Regulation. In contrast, responses from business and industry did 
not cite major concerns with reporting.  
A legal analysis of the diffe rent options for streamlined reporting showed however 
that the margin for manoeuvre was limited because of the need to meet the reporting obligations of the Montreal Protocol a nd the Commission’s need for information on 
progress in the various phase-outs
25. An analysis of potential synergies with 
reporting under other EU legislation s howed no duplication of information. 
Moreover, the reporting and monitoring provis ions in the Regulation are often cited 
as one of its strengths.  
Reporting represents an administrative cost for Member States and companies in the 
form of time and effort required to co llate information and prepare and submit 
reports. Producers, importer s, exporters and users of controlled substances are 
required to report respectively on produc tion, imports, exports and on quantities 
recycled, reclaimed and destroyed, as well as any stocks of ODS.  
                                                 
25 In addition, two options were considered and di scarded. Harmonising repor ting requirements with the 
F-Gas regulation was discarded because few companies report under both pieces of legislation and the 
reporting requirements do not overlap significantly. Sanctioning companies who have not reported in 
three or more years by withholding licenses or author isations was also discarded because of concerns of 
proportionality.  
 
EN 23   EN 5.2.2.  Description of Options  
Option 0: No EU action 
Option 1: Simplified and on-line repor ting requirements for companies (non-
regulatory option) 
Option 2: Streamlining reporting on ODS destruction 
Option 3: Cancelling the reporting requir ement for ODS recovery, recycling and 
reclamation, and for HCFCs replacing halons  
Option 4: Centralising reporting to  UNEP at the Commission level (non-
regulatory option) 
Option 0: No EU action 
The current reporting requirements would continue. These are estimated over the 
period 2010-2020 at a total of €1.5 million to Member States and €420,000 to ODS importers, exporters and producers. The Comm ission’s overall cost of gathering this 
information and assembling it into reports for the Ozone Secretariat is estimated at €560,000. 
Option 1: Simplified and online re porting requirements for companies 
Companies that export and import ODS mu st provide data, annually via the ODS 
database
26, to the Commission for the purpose of  ensuring EC compliance with the 
reporting obligations under the Montreal Prot ocol. The companies are not required to 
provide the Commission with production da ta as production is licensed by Member 
States. The obligation on companies to re port data on imports and exports could be 
deleted from Article 19.  
The feasibility of this option depends on a ddressing some data gaps in the licensing 
processes that are processe d through the Commission's OD S database as well as 
improved feedback from Custom authoritie s that curren tly do not return processed 
licenses. Reporting on production which is no t subject to licens ing by the EC would 
still be required under Article 19, as we ll as information on stock levels. These 
reporting requirements can be modified through Comitology in the current Regulation. 
Moving beyond electronic data submission towards online reporting would allow 
Member States (and companies) to directly  input information into the ODS licensing 
database hosted by the Commission. Electr onic reporting by Me mber States (i.e. 
sending reports in electronic form, e.g. via CIRCA) is currently widely used. 
Companies and other users currently repo rt by email, and a contractor to the 
European Commission compiles these reports. Whilst electronically submitting reports yields some time saving, its effici ency gains would be limited because it is 
still necessary to input the data at some stage.  
Option 2: Streamlining reporting on ODS destruction  
Given the particular importance of mon itoring the recovery of ODS from older 
products and equipment, this option woul d require ODS destru ction facilities to 
                                                
 
26 The ODS database is an on-line facility operated by the Commission to facilitate licensing of and 
reporting by industry 
 
EN 24   EN report directly to the Commission on the types and quantities of ODS they have 
destroyed rather than indirectly via th e Member State Competent Authorities. 
Currently, Member States are required to report on recovery, recy cling, reclamation 
and destruction of ODS. However the quality of the data received by the 
Commission is often poor reflecting also th e difficulties in obtaining those data.  
An extension of this option was consid ered, requiring recove ry, recycling and 
reclamation operators to report directly  to the Commission. This extension was 
discarded in view of the la rge number of facilities invo lved in the recovery and 
recycling of ODS (including small enterpri ses such as motor vehicle services, WEEE 
collectors), as it would lead to dispr oportionate implementation and enforcement 
costs whilst there is no such  reporting requireme nt on these data under the Montreal 
Protocol.  
Option 3: Cancelling the Member Stat es' annual reporting requirement for 
ODS recovery, recycling and reclamation and for HCFCs replacing halons 
Reporting on ODS recovery, recycling and r eclamation is not a requirement of the 
Montreal Protocol. This option would th erefore remove Member States' reporting 
obligations on recovery, recy cling and reclamation. However, Member States shall 
ensure that operators keep records on t hose activities, already broadly covered by 
national waste legislation transpos ing the relevant EC Directives. 
By 2010, Member States are not expected to report to the Commission any further 
use of HCFCs as replacements for halon cr itical uses, as required by Article 5(3). 
This obligation can therefore be removed. 
Option 4: Centralising reporting to  UNEP at the Commission level (non 
regulatory option) 
In accordance with the ratification provision, Member States currently report directly 
to the Ozone Secretariat on ODS producti on, whilst the Commission reports on 
consumption of ODS on their behalf. Si nce consumption is defined as production 
plus imports minus exports, the Commission must await the collection of production 
data (mainly done through Article 19) before  consumption data can be calculated and 
reported to the Secretariat. There is, theref ore, duplication of reporting effort, which 
sometimes also leads to inconsistenc ies at UNEP level between production and 
consumption data. This option would requi re data collation and reporting by the 
Commission to the Ozone Secretariat to be  expanded to include  both consumption 
and production.  
5.2.3.  Impact Analysis  
Simplified reporting requirements for companies, through relying more on the ODS 
licensing database for the purpose of comply ing with the Montreal Protocol reporting 
obligations as pr oposed in option 1 , could yield savi ngs in administrative costs of an 
estimated €0.29 million (all estimates NPV 2010).  
Moving towards online reporting for companie s would require an initial investment 
from the Community Budget of an estimated  €50 000 in the first y ear. Over time, on-
line reporting will yield savings in admi nistrative costs for companies and the 
Commission by simplifying the paper flow. Overall costs saved by the Commission 
are estimated to be €0.16 million. Savings for companies are likely to be more 
modest, assuming the same data would n eed to be reported (€ 0.05 million). Set-up 
 
EN 25   EN cost for online reporting for Member Stat es is likely to be higher as reporting 
requirements are more complex. The immedi ate benefits for Member States would 
also be limited as most reports contain qua litative information for which it is more 
difficult to create uniform reporting format s that would yield significant savings.  
Concerning option 2 , various pieces of EC legisla tion, such as the Waste Framework 
Directive and the WEEE Directive, require th e relevant facilities to keep records of 
the quantities of substances27, including ODS, that are recovered, recycled, reclaimed 
and destroyed, and to make them available to the authorities when so required. The 
cost would be further limited because ther e are few destruction facilities within the 
EU, and they are already familiar with repor ting as Member States normally request 
this information from them. In addition, the quality of reporting on ODS destruction 
will improve. It is estimated that the additi onal administrative cost to industry for a 
more systematic reporting directly to the Commission would be some € 0.2 million. 
The associated cancelling of the reporting requirements from Member States would 
lead in parallel to savings of € 0.27 million. 
The savings in terms of reporting costs from  Member States associated with option 3  
are estimated at around € 0.4 million. This would lead to less information on 
recycling, recovery and reclamation, but due to the difficulty in obtaining these data, 
the current quality of the reporting is poor, and there is no reporting requirement 
under the Montreal Protocol. Under Member States' waste legislation the relevant 
information should already be recorded by the operator concerne d. On the basis of 
Article 20 such data might be requested by the Commission on a case by case basis, 
if need be. 
Cancelling the reporting requirement relati ng to the use of HCFCs to replace halons, 
would reduce administrative costs for Me mber States and the Commission for an 
estimated € 0.02 million. 
Provided that additional repor ting from destruction facil ities becomes effective (as 
proposed in option 3), the centralizing of UNEP reporting proposed in option 4  could 
reduce the administrative burden associated  with the reporting of production and 
consumption data by Member States an d the Commission by an estimated € 0.06 
million. Increased consistency in the data  reported to UNEP (and subsequently 
published) is considered a nother ancillary benefit.  
5.2.4.  Comparison of the Options and Emerging Preferences  
Table 5:  Options for streamlining of repor ting and reducing the associated 
administrative burden 
POLICY OPTIONS 
Bold: preferred regulatory option 
Italics: preferred non-regulatory option 
Strikethrough : discarded option 
*option implemented through other EC legislation  
Environmental 
Impacts (ODP 
tonnes) 2010-2020 
Administrative Costs 
(€million) (NPV 2010) 
Direct Economic 
Impacts (€million) 
(NPV 2010) 
Social and Other 
Impacts  
1. Simplified and online reporting for 
companies & users  0 -0. 5  0 0 
                                                 
27 E.g. Article 14 of Directive 2006/12/EC or Article 7(3) of Directive 2002/96/EC. 
 
EN 26   EN 2. Streamlining reporting on ODS 
destruction 0 -0.07  0 0 
3. Cancelling MS reporting on ODS recovery, recycling and reclamation and for HCFCs replacing Halons 0 -0.42  0 0 
4. Streamlining UNEP reporting  0 -0.06  0 0 
Total impacts related to preferred regulatory 
options 0 -0.49  0 0 
All the options considered are complementar y and are proposed to be retained, some 
alternatives having already been discar ded. Option 2 would provide additional 
information from destruction facilities thereby enabling the Commission to have 
more complete data on production and to centralise reporting to UNEP (option 4).  
Option 3 would cancel the reporting require ment on ODS recovery, recycling, and 
reclamation from Member States. The Regul ation should include a clause allowing 
the Commission to seek such information fr om Member States as and when needed 
to allow effective monitoring of implementation and future review. 
Further non-regulatory actions (options 1 a nd 6), to implement in parallel to the 
Regulation review following more detailed  assessment, would provide additional 
savings.  
Overall savings in administrative burden  resulting from regul atory options would 
amount to about €0.5 million (more than €1 million when including non regulatory options). Accompanying direct costs to industry are expected to be negligible. 
5.3. Updating Exemption Regimes and Re lated Administrative Processes 
5.3.1.  Definition and Drivers of the Problem 
Exemption regimes have played an important  role in ensuring cost-effectiveness and 
proportionality, especially dur ing the early stages of the implementation of ODS 
phase-out. At the tail end of this proce ss most exemption regimes have lost their 
economic relevance. Relatively few actors benefit from the exemption regimes, yet their administration still results in consid erable costs. Moreover, the 2006 Report of 
the SAP warned that current exempted uses must be reduced if the recovery of the 
ozone layer was to materialize as projected. 
A specific issue is related to the inward processing relief (IPR) regime, whereby 
ODS are imported into the European Comm unity for repackaging and export. The 
ODS Regulation allows the issue of import licenses for specific substances for IPR. As these uses are phased out, the IP R regime should be re-assessed.  
In addition, in parallel to the review of the Regulation, a separate review is underway 
of the critical uses of halons listed in  Annex VII. The purpose of the Annex VII 
review is to reduce the number of uses and insert phase out dates for those that 
remain, reflecting the now greater availabil ity of alternatives. Consultations with 
stakeholders have confirmed th e feasibility of ending the cr itical uses ov er the period 
2010 to 2030. Stakeholders ha ve indicated, however, th at for certain specific 
applications, no alternatives have yet been  identified. For the purpose of enabling the 
insertion of challenging deadlines whilst avoiding possible disproportionate costs 
(and adverse safety implications), it was strongly recommended that a new exempted 
use clause would be inserted in the Regulation. 
 
EN 27   EN 5.3.2.  Description of Options  
Option 0: No EU action 
Option 1: Ending production of ODS for Basic Domestic Needs  (BDN) 
Option 2: Ending the Inward Processing Re lief (IPR) Regime for MB and HCFCs 
Option 3: Ending exempted uses of HCFCs for replacing halon s 
Option 4: Ending exempted uses of HCFCs where no alternatives are available   
Option 5: Inserting a new exempted use clause for critical uses of halons 
Option 6: Updating the essential use pro cess for laboratory and analytical uses 
Option 0: No EU action 
The projected level of exemptions will co ntinue as from 2010. Whilst EC companies 
currently produce and export CFCs and CTC to  enable developing countries to meet 
their basic domestic needs for these substances (BDN), those regimes will soon end in accordance with the pr ovisions of the Montreal Protocol. Between 2010 and 2015, 
the BDN regime will be limited to 1,1,1-tr ichloroethane (TCA). The current low 
levels of TCA exports for BDN (at less than  100 ODP tonnes) are expected to drop 
beyond 2010 as demand decreases. The con tinued BDN regime would maintain low 
levels of administrative costs. 
The IPR regime for MB, although involving relatively small qu antities of ODS, 
results in several hundred licen ce applications each year.  The overall administrative 
costs are estimated to be €0.63 million (all estimates are NPV at 2010). 
IPR for HCFCs currently represents only a small share of the number of requested 
IPR licences. EU HCFC producers have b een withdrawing from the global HCFC 
market, shifting production capacity to HFC substitutes for which demand has been growing steadily. Furthermore, IPR applies only to a very small share of global demand for HCFCs, which is expected to fade more rapidly following the adoption 
of Decision XIX/6 on th e accelerated phase out of  HCFCs. The associated 
administrative costs are estimated at €0.29 million. 
The Regulation provides an exemption to a llow use of HCFCs as replacements for 
halon critical uses. This provision has been little used in the past with only one 
request dating back to 2005 that involved 25 kg (for which alternatives are now 
available). The baseline assumes no furt her exemption requests and therefore no 
administrative cost. 
The present exemption for the placing on th e market of HCFCs wh en no alternatives 
are available is projected to continue into the future under the baseline scenario, with 
associated costs of €0.12 million. 
Laboratory and analytical uses of ODS will remain as one of the few remaining 
exempted uses beyond 2010. Projected ad ministrative costs of licensing are 
estimated at €0.28 million. 
The overall administrative costs associated  with no action over the period 2010-2020 
would therefore be more than €1.3 million. 
Option 1 : Ending production of ODS for Basic Domestic Needs  
 
EN 28   EN This option would remove the current Artic le 3(6) provision allowing production of 
TCA for BDN.  
Option 2: Ending the Inward Processing  Relief Regime for Methyl Bromide and 
HCFCs   
This option would end the IPR regime for MB  and as such correct what is generally 
considered a loophole. IPR for ODS has trad itionally been allowed until their placing 
on the EU market was banned according to the Regulation. For MB, the IPR regime 
did not stop when the import ba n came into place. This is generally considered as an 
omission at the time the Regul ation was developed. It woul d also end the IPR regime 
for HCFCs in 2010, when the import ban for HCFCs will come into effect.  
Option 3: Ending exempted uses of HCFCs for replacing halon 
This option would remove the present der ogation in Article 5(3) of the Regulation 
allowing the use of HCFCs as replacements for halon critical uses. This option is 
considered as merely updating the Regulation to reflect the present state of play.  
Option 4: Ending the exemption for the placing on the market of HCFC where 
no alternatives are available 
This option would remove the present Artic le 5(7) of the Regulation which provides 
the possibility of authorising the placing on the market and time-limited use of 
HCFCs where alternatives are not available.  
Option 5: Inserting a new exempted use clause for critical uses of Halons 
This option would insert a modified exem ption clause in the Regulation, to avoid 
possible disproportionate cost s and adverse safety implic ations linked to the phase 
out dates for critical uses likely to be propos ed as a result of the separate review of 
Annex VII to the Regulation.28  
Option 6: Updating essential use regime  for laboratory and analytical purposes 
The preferred option is for the Commission to assess requests and grant exemptions 
for multiple years, rather than annually as currently practised, and to establish a cap 
on total ODS consumption at a level close to that of recent historic use. The latter 
would serve as an additional signal to laboratories that the ultimate goal is for them to move away from ODS use. The opti on also implies further non-legislative 
initiatives whereby the Comm ission and/or Member States  would develop web-based 
information to better inform laborat ories on the alternatives to ODS use
29. 
5.3.3.  Impact Analysis  
The impact of option 1  on EU companies is projected to be zero or very low as few 
developing countries are currently importi ng TCA from the EC for and demand is 
continuing to drop towards zero. Ending the BDN exemption will further contribute to an overall simplification of the Regulation and the enforcement thereof. 
The ending of the IPR regime for MB, as proposed in option 2,
 is expected to have a 
small economic impact (approximated to be forgone profit margins for the company 
                                                 
28 The preferred solution is subject to ongoing discussions with the Commission Legal Services. 
29 The option to extend licensing requirement to laboratories rather than importers and producers was 
discarded because of the large number of laboratori es that would be impacted and the significant 
infrastructural changes that would be required at the level of the ODS licensing system. 
 
EN 29   EN involved) but also savings in administrati ve costs, notably for the Commission and 
one Member State. 
As MB traded according to the IPR regime is not destined for the EU market, there 
will be no immediate direct environmental impacts. Indirect environmental benefits can be expected, however, outside the EU, notably in destination countries that may have further incentives to adopt alternativ es that are technically and economically 
viable. The extent to which these benefits will materialize will depend on the substitution rate in destination countrie s and the involved company's readiness to 
adapt its product range to incl ude these alternatives. Shou ld the latter  not happen, 
there may be consequences in terms of social  impacts, i.e. a few tens of jobs may be 
lost. This social impact is considered ve ry low, however, considering the presently 
tight labour market in the Member State i nvolved. An important side benefit is that 
the ending of this IPR regime will streng then the EC’s negotiating position in the 
Montreal Protocol context, notably in its efforts to motivate other Parties towards a 
quicker phase-out of critical and other uses  of MB. It also removes the risk of non-
compliance with the Montreal Protocol due  to likely discrepancies between licensed 
import and export volumes at the end of the year.  
Ending the IPR regime for HCFCs in 20 10 will not have significant direct 
environmental impacts as global custom ers may readily switc h to other non-EU 
based suppliers. Indirect environmenta l benefits could be generated through 
international negotiations and related s upport activities as it would strengthen the 
EU's credibility in promoting the timely implementation of the global phase-out of HCFCs. The economic impact of ending the IP R for HCFCs is expected to be low as 
demand for HCFCs is expected to decrea se. Under a low-dema nd scenario, direct 
costs for the companies involved are exp ected to be €0.5 million (using foregone 
profit margins for the period 2010-2020 as a proxy). However, as mentioned, these losses are likely to be offset by increased profits from the more lucrative export of 
HFCs. Related administrative cost savings  are expected to range between €0.21 
million for industry and € 0.08 for the Commission. 
Removing the derogation for HCFCs repl acing halons, as proposed in option 3
 and 
for placing on the market of HCFCs, option 4,  will not have significant economic, 
environmental or social impacts. Savings in administrative costs and environmental 
benefits would be equally limited, consideri ng that very few cases  were processed in 
recent years. According to a conservative estimate, savings would amount to €0.1 million. However, two Member States and i ndustry have requested  retention of the 
placing on the market exemption. Furthermor e, enlarging the exemption to include 
products and equipments woul d limit the costs of banni ng trade of products and 
equipments manufactured before the HCFC use ban date (providi ng also a benefit in 
terms of illegal trade) and allow conti nued exemptions for HCFC use as halon 
alternatives where necessary. Thus the pr eference is for option 3, and option 4 will 
not be taken forward.  
Option 5
 would create administrative costs asso ciated with assessing the requests for 
exemptions for critical uses of halons, but these would be considerably smaller than 
the disproportionate costs of  replacing halons in the mo st challenging circumstances. 
With option 6 , only producers and importers of ODS, distributors of laboratory 
chemicals and laboratories and research institutions in th e public and private sector 
would be affected. No regionally specific im pact is expected. The extent to which the 
multi-year exemption will reduce administrative costs would depend on the number 
 
EN 30   EN of years for which the exemption would be gr anted and will have to be tied to related 
Decisions of the Parties. Estimated savi ng based on an average two-year cycle are 
generally low, however, amounting to €0.09 million. In addition, the multi-year exemption will improve regulatory certainty  for importers and producers (which will 
still have to request li censes on a yearly basis). 
5.3.4.  Comparison of the Options and Emerging Preferences 
Table 6:
 Options for Updating Exemption Regimes and Related Administrative 
Processes 
POLICY OPTIONS 
Bold: preferred regulatory option 
Italics: preferred non-regulatory option 
Strikethrough : discarded option 
*option implemented through other EC legislation  
Environmental 
Impacts (ODP 
tonnes) 2010-2020 
Administrative Costs 
(€million) (NPV 2010) 
Direct Economic 
Impacts (€million) 
(NPV 2010) 
Social and Other 
Impacts  
1. Ending production of ODS for BDN  0-22 - +(1) -(2) 
2. Ending IPR for MB and HCFCs in 2010 0-6475 -0.92 +(1) -(2) 
3. Ending exempted uses of HCFCs for 
replacing halons 0 - 0 0 
4. Ending exempted uses of  HCFCs when no 
alternatives are available  0-2000 -0.12 + 0 
5. Inserting a new exempted use clause for 
critical uses of Halons  -125 -0 + -- 0 
6. Updating the essential use process for 
laboratory and analytical uses  0-200 -0.09 0 0 
Total impacts related to preferred options 0-6570 -1 3.3 -(2) 
1 Confidential (impact included in total) 
2. Possible small job loss 
Considering that all options , as summarised in Table 6,  are complementary and that 
none would have significant economic impacts, the preference is to  retain all options 
except option 5. Expected administrative savings are more than €1 million. Direct economic impacts (approximated by foregone profit margins) would be in the magnitude of €3 million. Whilst the packag e could result in up to 6570 reduction in 
ODP tonnes produced or transiting in the EU , there is uncertainty  in terms of the 
global environmental impact, as much depends on the indirect impact on production and consumption in developing countries. I ndirect benefits could however be reaped 
from a stronger Community position in international negotiations.  
 
EN 31   EN 6. ENSURING CONTINUED COMPLIANCE WITH THE MONTREAL PROTOCOL  
6.1. Implementing Decision XIX/6 on th e accelerated phase out of HCFCs 
6.1.1.  Definition and Drivers of the Problem 
Following the concerns expressed in th e SAP's 2006 Report on the accelerating 
growth of HCFC production and consumpti on in developing countries, the EU and 
other Parties acted swiftly by adopti ng Decision XIX/6. Whilst the phase out 
schedule for developing countries was a dvanced from 2040 to 2030, the schedule for 
industrialized countries was changed from 2030 to 2020, reflecting the fact that most 
industrialized countries, notably the EU, were already ahead of the schedule. 
The key task is to align the Regulation with  this Decision by adjusting the phase out 
schedule from 2025 to 2020.  
Options for contributing to the efforts of de veloping countries could also usefully be 
explored. 
6.1.2.  Description of Options  
Option 0 (maintaining the BAU case) woul d put the EU into non compliance with 
the Montreal Protocol, a nd was therefore discarded.  
Option 1: Adjusting HCFC Production Phase out Date from 2025 to 2020 
Option 2: Moving HCFC Production ban to 2015 or 2010 (instead of 2020) 
Option 1: Adjusting the HCFC Produc tion Phase-Out Date from 2025 to 2020 
This option implies a minimum level of action by strictly adjusting the phase-out 
data for production of HCFCs from 2025 to  2020 as required by all industrialized 
countries in accordance with Decision XIX/6. As this measure was already agreed upon at the 19
th Meeting of the Partie s held in September 2007, it forms the de facto 
baseline case against which th e other options are assessed.  
Option 2: Moving Production ba n to 2015 or 2010 (instead of 2020) 
This option implies a more ambitious adaptation of the Regulation by moving 
forward the phase out date for the producti on of HCFCs in the EU to 2015 instead of 
the required 2020 date. It w ould align the phase out of production with the ending of 
permitted use of HCFCs in the EU. An alternative would imply aligning the 
production ban of HCFCs with the 2010 ba n date for importin g and using virgin  
HCFC in the EU.  
6.1.3.  Impact Analysis  
Because moving the ban on production of HCFCs from 2025 to 2020, as proposed in 
option 1,  represents the de facto baseline, no additional impacts are associated with 
this option . This option was indeed already ag reed upon with Member States and 
industry during the final cons ultations that were held in the margins of the 19th 
Meeting of the Parties. 
Moving the ban on production of HCFCs within the EU to 2015 or 2010 – option 2  – 
implies an additional economic impact  for EU industry equal to the potential 
foregone exports. Considering a low and high price scenario, the total market that 
would be lost could range between €11.7 million and €82.9 million for the period 
2010 to 2020. Because a number of HCFC-relate d patents are due to  expire in 2010, 
with associated downward pressure on prices , the low-end of the range is considered 
 
EN 32   EN more likely to apply. Assuming a net pr ofit margin of about  20 percent, the direct 
cost to industry  related to a shift to 2015 would be around €2.3 million (all estimates 
are NPV in 2010). Foregone profits relate d to a shift to 2010 would be ranging 
around €9.5 million. Direct costs may still be overstated because released production capacity is likely to be absorbed by the same companies for the production of HFC or other chemical alternatives for HCFC refr igerants (with higher profit margins). For 
the same reasons, job losses or other social impacts  are expected to be insignificant.  
Environmental impacts  associated with option 2
 are likely to be  limited. Moving the 
ban to 2015 would result in a foregone pr oduction compared to the baseline of 5200 
ODP tonnes, whereas a phase out in 2010 would result in a reduction of 18000 ODP 
tonnes for. Reduced global supplies of HC FCs from EU producers are likely to be 
partly replaced by increased production of HCFC in developing countries, where 
production plants may operate according to le ss strict environmental standards. For 
example, HFC23, a by-product of HCFC prod uction with a high GWP, is not flared 
in all installations as it is in the EU, so  additional HCFC production in such plants 
may contribute further to global warmi ng. Environmental benefits will be 
furthermore muted in the event that restricted supplies of HCFCs (should this occur) 
may lead to a greater uptake of HFCs  rather than lower-ODP alternatives. 
6.1.4.  Comparison of the Options and Emerging Preferences 
Table 7 : Options for Implementing Decision XIX/6 on the accelerated phase out of 
HCFCs 
POLICY OPTIONS 
Bold: preferred regulatory option 
Italics: preferred non-regulatory option 
Strikethrough : discarded option 
*option implemented through other EC 
 legislation 
Environmental Impacts 
2010-2020 
(ODP tonnes) 
Administrative Costs 
(€million) (NPV 2010) 
Direct Economic Impacts  
(€million) (NPV 2010) 
Social and Other Impacts  
 
1. Advancing production phase out to 2020  De facto base case 
2. Advancing production phase out to 2010 or 
2015  0-18000 - 2.3-9.5 + 
Total impacts related to preferred options  0 0 0 0 
Option 2 is an alternative to option 1, which represents the de facto base case against 
which impacts were assessed  
Advancing the ban on HCFC producti on from 2025 to 2010 would be most 
consistent as it would align the production ban with the ban on HCFC import and the 
use of virgin HCFCs. However, when comparing the options there emerges no 
compelling argument for deviating from the de facto base case reflected in option 1 . 
Environmental benefits do not constitute a decisive criterion, as the overall global impact of a reduced EU production is uncertain. Neither do anticipated 
administrative savings provide an ove rriding argument for compensating the 
anticipated direct costs for EU producers of HCFCs. Hence option 1
 whereby 
production of HCFCs is moved forward from  2025 to 2020, emerges as the preferred 
choice.  
 
EN 33   EN It is noted that, even for the most ambiti ous scenarios reflected in option 2, direct 
costs to industry remain fairly modest. Depending on the need for tighter measures, 
e.g. against illegal trade, ther e is some margin during the political decision making to 
deviate from the preferred option, ideally following further consultations with the 
industry involved. 
6.2. Adapting the phasing out of the use of HCFCs 
6.2.1.  Definition and Drivers of the Problem 
Article 5(1)(v) of the Regulation calls upon the Commission to assess the technical 
and economic availability of al ternatives to HCFCs for the purpose of a reviewing of 
the 2015 phase-out date for the use of recy cled and reclaimed HCFCs. The rationale 
for this review is to consider bringing fo rward or delaying these phase out dates in 
view of latest experiences. A related issu e is the need to assess whether a mechanism 
is required to avoid virgin  HCFCs being placed on the ma rket as illegal substitutes 
for recycled or reclaimed HCFC. Virgin  HCFC can indeed be rather easily 
contaminated or processed to make it indi stinguishable from re cycled HCFC. This 
form of counterfeiting is less likely to  occur for reclaime d ODS as these are 
undergoing a purification proce ss in specialized sites. 
6.2.2.  Description of Options 
Option 0: No EU action 
Option 1: Advancing the Phase out date for the use of recycled and reclaimed 
HCFCs from 2015 to 2012 
Option 2: Voluntary agreement with i ndustrial process refrigeration sector 
Option 3: Certification of r ecycled and reclaimed HCFCs 
Option 4: Limiting the supply of HCFCs to reclaimed HCFCs only 
An additional option to delay the phase-out date for the use of recycled HCFCs from 
2015 to 2020 was discarded, based on the recommendations of a study conducted for the Commission in 2006. This found that industry was facing no difficulties in 
complying with the 2015 date.
30 
Option 0: No EU action 
The use of recycled and reclaimed HCFC s would be phased out as from 2015 as 
currently foreseen by the Regulation.  
Option 1: Advancing the Phase out date for the use of recycled and reclaimed 
HCFCs from 2015 to 2012 
The ban date for the use of recycled a nd reclaimed HCFCs would be brought forward 
from 2015 to 2012, taking into  consideration progress with the technical and 
economic availability of alte rnatives to recycled HCFC. 
Option 2: Voluntary agreement with i ndustrial process refrigeration sector 
To account for potential difficulties for the i ndustrial process refr igeration sector by 
2012, a voluntary agreement would be pursued w ith this sub sector as an alternative 
                                                 
30 ICF International, Review of the Technical and Ec onomic Availability of Feasible Alternatives to 
Recycled Hydrochlorofluorocarbons (HCFCs) in Existing Refrigeration Equipment, 2006 
 
EN 34   EN to option 1. This would require  that the sector proposes a phase-out strategy with an 
accompanying monitoring scheme that is then reviewed and endorsed by the Commission and the Member States.  
Option 3: Labelling of recy cled and reclaimed HCFCs 
This option would require producers (i ncluding reclamati on facilities) and 
distributors of recycled and reclaimed HCFCs to label containers with the origin 
(using a unique ID number) a nd purity of the HCFC.  
Option 4: Limiting the supply of  HCFCs to reclaimed HCFCs only 
This option would prohibit th e sale of recycled HCFCs,  limiting the supply HCFCs 
for servicing of equipment between 2010 and 2015 to reclaimed HCFCs only, which 
would have to be labelled as  reclaimed. As with option 3, this would aim at reducing 
the risks of illegal trad e and use of HCFCs.  
The re-use of HCFCs recovered while servicing equipments would remain 
authorised. Reclaimed HCFCs wo uld serve as top-up material. 
6.2.3.  Impact Analysis  
The main sectors identified as bei ng potentially affected by option 1
 are related to 
commercial refrigeration, refr igerated transport, sta tionary air conditioning, and 
industrial process refrigeration. The 2006 st udy noted that, whilst alternatives to 
HCFC were widely available for most s ectors, phase-out earlier than 2015 would 
impose disproportionate economic and tech nical burdens on European companies, 
particularly for SMEs in the commercial re frigeration, refrigerated transport, and 
stationary air conditioning sectors. With re gards to industrial process refrigeration, 
this study estimated that an advanced sche dule for phase-out c ould yield significant 
ODS emission reductions cost-effectively.31 However, a detailed follow-up study32 
on HCFC use in industrial process refrigeration raised issues with respect to 
implementing a phase-out by 2012 and did not co nfirm that cost effective, significant 
environmental benefits could be delivere d by bringing the phase-out date to 2012 for 
this sector on its own, due to lack of  data. The study proposed instead that a 
voluntary agreement is negotiated between the Commission, Member States and the 
representatives of the industrial proce ss refrigeration sector, pending further 
consultation of the sector. 
Option 2  would develop a phase-out  strategy with the industr ial process refrigeration 
sector where environmental benefits might be realised, prioritising the phase-out of old and large installations requiring most  maintenance care and servicing with 
HCFCs. 
The costs of option 3
 are limited to affixing labels by the recycling and reclamation 
facilities. The aim would be to verify the source of recycled products and to reduce 
the risk of illegal trade and use of virgin HCFCs. However, this option may not be easily implemented as the number of actors involved in the recycling process is much 
larger than the number of players in HCFC reclamation business. Recycling 
                                                
 
31 ICF International, Supply and Demand of Recycled Hydrochlorofluorocarbons (HCFCs) in Existing 
Refrigeration and Air Conditioning Equipment Beyond 2009: Analysis of Regulatory Phaseout Scenarios, August 2006 
32 ICF International, The feasibility and Cost effectiveness of advancing the phase-out date for HCFCs in 
industrial Process refrigeration equipment, Draft report, April 2008. 
 
EN 35   EN operations with HCFC can be done on the equipment site with simple filtering 
devices. The enforcement of the requireme nt to certify and label the recycled 
material is likely to prove difficult in practice.  
Option 4  would minimise the risk of developm ent of a market of illegal recycled 
HCFC, whilst also limiting the risk of divert ed use of virgin HCFCs. This option is 
realistic considering that s upply of reclaimed HCFCs is not projected to constrain 
demand over the period 2010 to 2015. Curren tly, 46 reclamation facilities operate 
across 20 EC Member States33. As the projected suppl y of reclaimed HCFC 
significantly exceeds the projected demand, th e cost increase from restricting the 
servicing market to reclaimed HCFCs only is  marginal. Incidentally, an increase in 
the price of reclaimed HCFCs would accel erate the transition away from HCFCs 
which would reap environmenta l benefits also from a climate change perspective as 
new equipment demonstrates signifi cantly better energy efficiency.  
6.2.4.  Comparison of the Options and Emerging Preferences 
On Option 1 , the cost-effectiveness of an expedi ted phase out for recycled/reclaimed 
HCFCs could not be demonstrated, due to la ck of data. A more targeted voluntary 
agreement with the industrial process refr igeration sector, where some cost-effective 
options have been identified, could be envisaged (option 2 ). Option 4  was preferred 
to option 3  as it offers a more effective solution to avoid illegal use of virgin HCFCs. 
Table 8 : Adapting the phasing out of the use of HCFCs 
POLICY OPTIONS 
 
Bold: preferred regulatory option 
Italics: preferred non-regulatory option 
Strikethrough : discarded option 
*option implemented through other EC
 legislation  
Environmental Impacts 
2010-2020 
(ODP tonnes)  
Administrative Costs 
(€million, NPV 2010) 
Direct Economic Impacts  
(€million, NPV 2010) 
Social and Other Impacts  
 
1. Expedited phase out from the use of 
recycled and reclaimed HCFCs   0-600  
- ++ +(1) 
2. Voluntary agreement on phase out 
strategy with industry 0-400 0 + 0 
3. Certification of recycled and 
reclaimed HCFCs  + ++ 0 +(1) 
4. Use of reclaimed HCFCs only after 
2010  0-300 + + +(1) 
Total impacts related to preferred 
options 0-300 + + +(1) 
1. Reduced risk of illegal use of virgin HCFCs 
                                                 
33 7 Member States did not reply to date to  the survey on recy cled/reclaimed HCFCs. 
 
EN 36   EN 6.3. Options for Strengthening Enfo rcement of the Regulation 
6.3.1.  Definition and Drivers of the Problem 
Responsibility for enforcement action rests with the Member States, but there are 
indications that there is much left to do in  this area. The provisions for enforcement 
in the current ODS Regulation are limited. In  addition to illegal or harmful trade, 
there are concerns about ODS emissions with in the EU due to levels of leakages 
from stationary and mobile refrigeration units. Inspections are also needed during 
waste management operations, as the WEEE and ELV Directives do not require them 
for ODS. An additional concern is that customs officials find it difficult to identify 
ODS and to distinguish products and equipm ent that contain controlled substances 
from those which do not.  
6.3.2.  Description of Options  
Option 0: No EU action 
Option 1: Updating inspections provisions 
Option 2: Adapting labelling requireme nts for ODS produced for feedstock 
Option 3: Extending labelling requirements  to sales of products and equipment 
Option 4: Labelling existing products and equipment during servicing, recycling, and 
reclaiming. 
Option 5: Awareness Raising and Training Programmes 
An option to include further specificatio ns on penalties was discarded because of 
subsidiarity issues and th e ongoing inter-institutional debate on ways to tackle 
environmental crime.  
Option 0: No EU action 
Under the business as usual scenario, Member  States would continue to follow varied 
approaches to inspections for the enfor cement of the Regulation. These differences 
could provide a window for illegal trade as well as for lax practices  where ODS are 
used. 
In addition, current provisions of EC chemicals legislati on require producers, 
importers and exporters to label substances classified as ODS34. It is however not 
required to specify the use for which th ese substances have been produced or 
imported, and there is no explicit requirem ent on labelling of products and equipment 
containing or relying on ODS. Under the no action scenario, substances produced for 
certain uses only would conti nue to circulate freely in the Community with risks of 
diversion for other uses, and Member Stat es would continue to have difficulties 
identifying products and equipment containing ODS. 
Option 1: Updating inspections provisions 
This option  would amend Article 20 to highlight the need for risk-based inspection 
regimes. The scope of this obligation shoul d be explicitly exte nded to checks on the 
                                                 
34 Directive 1999/45/EC of the European Parliament and of the Council of 31 May 1999 concerning the 
approximation of the laws, regulations and administrative provisions of the Member States relating to 
the classification, packaging and labelling of dangerous preparations. 
 
EN 37   EN compliance with all provisions of the Regulation and not only with the import 
requirements.  
Option 2: Adapting labelling requirem ents for ODS produced for feedstock 
Labels would be affixed to containers of ODS produced or imported for feedstock 
uses, to distinguish them from ODS intended for other uses. 
Option 3: Extending labelling requirements to sales of products and equipment 
This option would extend the current labe lling requirements for ODS to include the 
placing on the market of new products and equipment containing or relying on ODS, 
as well as to sales of used products and equipment. 
Option 4: Labelling existing products and equipment during servicing, 
recycling, and reclaiming . 
This option would involve a ffixing labels to fixed equi pment (mainly large cooling 
installations), during servicing and whils t recycling, reclaimi ng and topping up any 
losses from leakages. 
Option 5: Awareness raising and training programmes 
This option would require the Commission and Member States to launch additional 
awareness raising and training initiatives to strengthen inspections and enforcement. 
These actions would particularly focus on Member States' customs agents in 
cooperation with existin g platforms such as IMPEL or CLEEN. The preparation and 
distribution of handbooks to assist in th e implementation of the Regulations are 
envisaged as accompanying measures.  
6.3.3.  Impact Analysis  
Option 1  should not entail significant additio nal costs, as the current Regulation 
already obliges Member States to ensure it s enforcement. The extension of the scope 
of the obligation would clarify this gene ral obligation. Shifting to risk-based 
sampling would only entail a marginal addi tional cost in terms of designing a new 
sampling strategy, whilst contributing to a more efficient use of resources. There 
should be a positive environmental impact in terms of reduction in illegal trade and leakage rates.  
The extended labelling require ment reflected in option 2
 would increase 
administrative costs for a limited number of importers and producers of ODS for 
feedstock uses. However, since ODS are al ready subject to la belling requirements 
under the chemicals legislation, the increa se would be limited to the costs of 
designing and distributing new labels. The improved transparency  would facilitate 
the enforcement by the Member States' aut horities and would contribute to reduced 
illegal trade.  
The labelling requirement in option 3  would mainly affect used, commercially sold 
refrigeration and air conditioning equipment containing HCFCs. It would impose direct costs on businesses, in particular producers and distributors of products and 
equipment containing ODS as well as reseller s of used products and equipment. The 
administrative costs for industry should be low– estimated at €37,000 annually 
between 2010 and 2014 (or €0.16 million NPV) – , as this market is expected to be 
restricted when the revised Regulation comes into force (products and equipment sold among individuals, such as used househol d refrigerators, would not be affected). 
 
EN 38   EN However, the environmental benefit would also be limited as quantities involved in 
terms of ODP would be small.  
Option 4  mainly impacts operators of large c ooling installations. Servicing operators 
would incur costs related to the time need ed to fill out and affix labels to the 
equipment they service. The estimat ed costs are some € 400,000 annually for 
operators across the EU, decreasing over time, i.e. a NPV of € 0.92 million. All 
installations would be progressively cove red, with decreasing costs in time, and 
benefits in terms of reduced illegal trade, al erting operators to th e need to recover the 
ODS at end of life. 
Option 5  would cost little as information mate rial is already under preparation, which 
could serve as basis for this initiative. For instance the Nordic C ouncil of Ministers is 
currently preparing a handbook. A joint wo rkshop in cooperation with IMPEL or 
CLEEN would cost around € 0.08 million, and would increase knowledge about 
violations and therefore reduce illegal activities. 
6.3.4.  Comparison of the Options and Emerging Preferences 
Table 9 : Options for strengthening enforcement of the regulation 
POLICY OPTIONS 
 
Bold: preferred regulatory option 
Italics: preferred non-regulatory option 
Strikethrough : discarded option 
*option implemented through other EC
 legislation  
Environmen tal Impac ts 
2010-2020 
(ODP tonnes) 
Administrative Costs 
(€million, NPV 2010) 
Direct Economic Impacts  
(€million, NPV 2010) 
Social and Other Impacts  
 
1. Updating inspections provisions 0-150 + 0 +(1) 
2. Adapting labelling requirements for 
ODS for feedstock use  0-90 + 0 +(1) 
3. Extending labelling requirement s to sales 
of products and equipments  + 0.16 0 +(1) (2) 
4. Labelling requireme nts for existing 
products and equipment during 
servicing 0-30 0.92 0 +(1) (2) 
5. Awareness raising and training 
programmes  + 0.08 0 +(1) 
Total impacts related to preferred options 0-270 0.92 0 +(1) (2) 
1. Reduced risk of illegal trade/use 
2. Increased consumer choice 
From the analysis, the preferred regulat ory options would be  options 1, 2 and 4. 
Options 1 would provide benefits in term s of better enforcement at little or no 
additional cost, whereas option 2 would he lp to keep track of ODS produced for 
feedstock, reducing the risk of diversion for other uses at a small additional cost. Option 4 would be the most effective label ling option to reduce illegal trade, inform 
consumers and facilitate the recovery of ODS. In contrast, option 3 would provide 
 
EN 39   EN little benefit while creating some costs.  Option 5 would also provide additional 
benefit and would be implemen ted outside the regulation.  
6.4. Options for Avoiding Illegal Import s and Closing Remaining Loopholes  
6.4.1.  Problem definition and Drivers 
Article 4(6) allows the importation a nd placing on the market  of products and 
equipment containing all ODS except HCFCs and MB manufactured before the entry 
into force of the Regulation. Article 5(4)  allows the importation and placing on the 
market of products and equipment containi ng HCFCs manufactured before the date 
of entry into force of the specific use re striction. These provisi ons are transitional 
clauses to reduce economic disruption. The last use ban for commercial products and 
equipment containing CFCs took effect in  2005, whilst the last ban for military 
equipment using CFC will take effect in 2009. For HCFCs, the last use ban will enter 
into force on 31 December 2008. Thus, by 2010 such transitional clauses should no longer be necessary. 
Nonetheless, Articles 4(6) and 5(4) cont ain a loophole: they refer to products and 
equipment containing ODS, but not to thos e relying on ODS. In at least one new 
Member State, second-hand refrigerators  and air-conditioners  relying on HCFCs 
have been imported without their HCFCs with  the intention of be ing refilled and sold 
in the EC, thus passing through the loophole. 
Lack of control of trans-shipment has been  identified by the Parties of the Montreal 
Protocol as a potenti al source of illegal trade (Decision XIX/12). 
6.4.2.  Description of Options  
Option 0: no EU action 
Option 1: Ending the import of products and equipments relying on ODS 
Option 2: Ending the import of products a nd equipments containing or relying on 
ODS manufactured before the specific use ban date 
Option 3: Extending licensing to entry unde r customs procedures or for customs-
approved treatments 
Option 0: No EU action 
The legislation would remain unclear and th e opportunity for import of used products 
and equipment relying on ODS manufactured  before the Regulation’s entry into 
force would remain. It is assumed that up to 45 000 refrigerators and freezers would 
be imported annually from 2010 to 2014, in pa rticular into the new Member States. 
The loophole allowing import of produc ts and equipment relying on ODS for 
refilling in the EC would not be addressed. 
Option 1: Ending the import of pro ducts and equipments relying on ODS  
This option would extend the ban in articles 4(6) and 5( 4) on import of products and 
equipments containing ODS to produc ts and equipments relying on ODS. 
Option 2: Ending the import of products  and equipments containing or relying 
on ODS manufactured before the specific use ban date  
This option concerns all ODS and would remove the placing on the market ban 
exemption for products and equipments manufactured before each relevant use ban. Placing on the market is interpreted as first placing on the market in the ODS 
 
EN 40   EN Regulation, and this option would therefor e only affect imports of products and 
equipments. Second hand markets within the EU for products and equipments already on the EU market before 2010 would still be allowed. In parallel, exemptions 
would be provided for specific cases deemed to be too costly. Article 5(7) currently 
provides an exemption for the placing on th e market of HCFCs wh en no alternatives 
are available. Enlarging it to products and equipments would enable such exemptions 
by a Comitology decision. 
Option 3: Extending licensing to en try under customs procedures or for 
customs-approved treatments 
Licensing currently only covers entry of goods  into the customs territory for release 
for free circulation in the Communit y. This option woul d extend licensing 
requirements to entry under other custom s procedures or for customs-approved 
treatments and uses, to better align th e Regulation with the customs code. ODS 
placed under temporary storage, including transhipment in Community ports and 
airports as well as trans it through the Community under customs supervision, would 
not be subject to licensing at this stage, but  a legal basis would be established for the 
Commission to gather evidence and cons ider measures for further control. 
6.4.3.  Impact Analysis  
Option 1  would have very minor economic impact s, as there have been few requests 
for imports of products and equipments relying on ODS. Environmental impacts would equally be small. The option is, how ever, necessary to clarify the Regulation 
and to close an unintended loophole.  
Option 2 : The economic impacts for CFCs would again be minimal as refrigerators 
and freezers containing CFCs imported unde r this provision would have been 
manufactured before 2000 and so not have  significant market value. In addition, 
ending the imports would remove  a provision that has prov ed extremely difficult to 
enforce, as there is no ma nufacture date on used produc ts. Environmental benefits 
would be small in quantitative terms, but  would avoid a continued build-up of CFC 
banks, particularly in  the EU-12 countries. 
The main economic impact for HCFCs w ould be on current importers of used 
refrigerators and users, who would incur an annual loss estimated at €0.22 million. 
On the other hand, this option would in crease EU sales of non-ODS containing 
refrigerators and freezers (a net annual be nefit estimated at €0.85 million). As a first 
estimate, it is assumed that – due to higher prices – new sales repl ace only half of the 
imports of HCFC-containing refrigerators a nd freezers. Even so, there would be a net 
economic benefit to EC operators of €2.78 million (NPV at 2010). The option would 
also provide greater legal clarity for enforcement against possible illegal imports of products and equipment and thus could re duce administrative costs for enforcement 
on the part of the Member States. 
There may be rare cases where, to avoid di sproportionate costs from bans on imports 
of long-life and high-value products and eq uipment, such as ships and aircraft, 
exemptions could be provided.  
Concerning environmental impacts
, this option would reduc e HCFC consumption in 
the EC by 1.5 ODP tonnes over the period 2010-2015. Importantly, it would limit the 
growth of HCFC banks in the EU. On a gl obal basis, however, little environmental 
benefit is expected, as used products and equipment would remain in third countries. 
 
EN 41   EN Under Option 3 , additional control on entry into the customs territory would make 
the tracking of illegal shipments possible and would therefore reduce the risk of illegal trade. No data are available on the volumes concerned, but additional administrative costs for customs authorities are not expected to be disproportional. 
Licensing would at this stage not apply to transhipment or transit through the 
Community under customs supervision to a void increasing the burden on operators 
and customs authorities, pending a separate evaluation of the benefits and costs of 
such a measure. 
6.4.4.  Comparison of the Options and Emerging Preferences 
Table 10
: Options for avoiding illegal impor ts and closing remaining loopholes 
POLICY OPTIONS 
 
Bold: preferred regulatory option 
Italics: preferred  non-regulatory option 
Strikethrough : discarded option 
*option implemented through other EC
 legislation  
Environmental Impacts 
2010-2020 
(ODP tonnes) 
 
Administrative Costs 
(€million, NPV 2010) 
Direct Economic Impacts  
(€million, NPV 2010) 
Social and Other Impacts  
 
1. Ending the import of products and 
equipments relying on ODS  0-5 - + 0 
2. Ending the import of products and 
equipments containing or relying 
on ODS manufactured before the 
specific use ban date 0-140 - -2.78 +(1)(2) 
3. Extending licensing to entry 
under customs procedures or for 
customs-approved treatments  + + 0 +(1) 
Total impacts related to preferred 
options 0-145 -- -2.78 +(1)(2) 
1 Reduced risk of illegal trade 
2. Possible job increase in the destruction sector  
The three options are not mutually exclus ive, and it is recommended that all are 
adopted. Option 1 would have minimal impacts,  but is necessary to close an existing 
loophole in the Regulation. Option 2 is nece ssary to avoid the further build-up of 
ODS banks in the EU, and would give a boost to the EU market for non-ODS 
refrigerators, resulting in an overall ec onomic benefit. A possibility to grant 
exemptions would be provided to avoid disproportionate costs in exceptional 
circumstances. Option 3 strengthens imports  control measures to address potential 
threats of illegal trade. 
6.5. Options for Avoiding Exports Harming the Phase Out in Destination Countries 
6.5.1.  Problem definition and Drivers 
Several Member States, several parties to the Protocol an d environmental NGOs 
have called for stronger international cont rol of transboundary movement of ODS 
and ODS-containing products and equipmen t, to reduce illegal trade. Although the 
EU, as an exporter, can pl ay a key role, the Commission does not at present have a 
 
EN 42   EN strong legal basis to reject any export aut horisation request. With the various phase-
outs already underway, there will be increas ing incentives for illegal trade. The 
reviewed options aim to im prove the control of tran sboundary movements of ODS 
and to bring the exports from the EU into  closer compliance w ith Decision XIX/12 
and with other Decisions of the Parties in this regard.  
6.5.2.  Description of Options  
Option 0: No EU action 
Option 1: Preventing the issuing of e xport authorisations  for unwanted ODS 
Option 2: Establishing an export no tification procedure for all ODS  
Option 3: Extending the ban on ODS exports to MB and HCFCs for destruction 
Option 4: Introducing expor t licensing per shipment 
Option 5: Extending the ban on exports of  products and equipment to HCFCs and 
MB and licensing remaining products and equipment 
Option 0: No EU action 
By 2010, a number of export categories will have disappeared. Decreases in licence 
applications are observed in most export categories, with the exception of IPR and 
halons. Taking this into account, the expor t authorisation regime will become less 
demanding to administer, and the project ed baseline administrative costs are 15.25 
work months per year (compared to an estimated 30.3 in 2006).  
Under business as usual, used products and equipment will also continue to be 
exported to developing and tr ansitional countries, and th e contained ODS might be 
released where those countri es do not have facilities for their proper recovery. 
Option 1: Preventing the issuing of export authorisations for unwanted ODS 
This option would provide th e legal basis for the Commi ssion to refuse an export 
license, if it had received information from  other Parties to the Montreal Protocol 
which indicated the potential for illegal trade or adverse consequences for ODS 
control measures in the importing country. 
Option 2: Establishing an export notification procedure for all ODS  
The Prior Informed Consent (PIC) Regula tion, which implements the Rotterdam 
Convention on the PIC Procedure for Certai n Hazardous Chemicals and Pesticides in 
International Trade, already covers tw o ODS (CTC and TCA). This option would 
expand this to include all ODS. 
Option 3: Extending the ban on ODS expo rts for destruction to MB and HCFCs  
The export for destruction of all ODS is banned, except for MB and HCFCs. Exports 
of the latter substances are indeed authori zed for all uses, including for destruction. A 
generalization of the export ban for all substances would end this loophole. 
Option 4: Introducing export licensing per shipment 
As the Regulation does not specify the type of licence required, this is not a 
regulatory option. Currently, i ndividual licences are requi red for each shipment of 
halons, ODS for basic domestic needs, inwa rd processing regime (IPR), and essential 
use exports. This option would extend the licensing requirement for other exports for 
which currently bulk licences are issued: ODS for feedstock uses, for process agent uses, all exports for MB and HCFCs except for IPR.  
 
EN 43   EN Option 5: Extending the ban on export s of products and equipment to HCFCs 
and MB and licensing remaining  products and equipments 
The export of products and equipment cont aining or relying on ODS other than MB 
and HCFCs, with the exception of some items such as personal effects, is currently 
prohibited. This option involves exte nding the ban to MB and HCFCs. 
Licensing is only currently required for substances. This option would extend the 
requirement to remaining products and e quipment that contain or rely upon ODS. 
6.5.3.  Impact Analysis 
Option 1 : Under the Montreal Protocol there ar e currently several schemes based on 
information exchange, which have been recogn ised as a useful tool to prevent illegal 
trade (e.g. Decision XIX/12, in troduced by the EC). Establis hing a legal basis for the 
refusal of licensing requests would enable the European Community to participate in those schemes more effectively. The economic impact would be negligible, as in the few cases that have occurred in the past, companies agreed voluntarily to withdraw 
their requests.  
Option 2 : Expanding the PIC regulation to all ODS could potentially lead to a 
simplified notification system for the Commission. The additional information on 
substances and hazards provided by the PI C procedures could be useful in the 
monitoring and enforcement of transbounda ry movements of ODS . However, this 
would require action at the le vel of the Rotterdam convention, i.e. outside the scope 
of this review, with likely  high administrative costs. Furthermore, the licensing 
requirements of the Rotterdam Convention a nd the Montreal Protoc ol do not match, 
e.g. the PIC system does not differentiate be tween uses. A previous test to merge PIC 
export notifications with the ODS database  showed that it w ould not deliver the 
expected benefits. 
Option 3 : There are currently no exports of  MB for destruction. No data are 
available on HCFC exports for destruction as the ODS database does not allow this 
distinction. It is however unlikely to be significant as HCFCs (as all ODS) are 
covered by the Basel convention, which woul d imply high export costs. Exports of 
other ODS for destruction are currently pr ohibited. The ban on exports of HCFCs for 
destruction would therefore clarify and strengthen the EU position on exports of 
waste, with no expected significant econom ic impact. The environmental impact 
would be positive as destruction facilities outside Europe are unlikely to be of the same standards, with an increased risk of release in the atmosphere. 
Option 4 : Moving to licensing per shipment fo r all exports would have significant 
benefits in terms of improved control ove r exports, and in harmonizing the regulatory 
requirements placed on all exporters, a nd would facilitate the exchange of 
information between Parties. The admini strative costs of expanding the current 
system are estimated to increase by around 0.6 man-months per annum for the 
Commission and 2 man-months for industry, representing an overa ll cost of €0.17 
million (NPV at 2010). This would, however, be offset by a simplification of the 
licensing system (with only one  type of licence), and the possibility of reducing the 
requirements for reporting by companies and users (see the option on streamlining of 
reporting). There may also be a case for exempting the maritime service sector from a requirement to apply for a licence of each sh ipment, if it is demonstrated that it is 
disproportionately hit by this measure. 
 
EN 44   EN Option 5 : The use of HCFCs in the manufacture of products for export will be 
banned as from 1 January 2010. Hence exports  of equipment containing HCFCs will 
be limited to used equipment. It is expe cted that, for the bul k of the equipment, 
HCFCs would be recovered and reclaimed. Ho wever, there is a risk that significant 
quantities of used HCFC equipment, whic h can no longer be re filled in the EU, 
would be exported to developi ng countries. While it has not been possible to evaluate 
the economic impact  in terms of foregone benefits of  banning such exports, it would 
be clearly undesirable that a market develo ps which would result  in the build-up of 
HCFC banks in countries where destruction facilities might not available, thereby 
causing a negative environmental impact . Such trade would be seen as harmful in the 
context of the Montreal Protocol. Economi c impacts might however be high for some 
long-lived products and equipment. To a void excessive costs, an exemption for 
aircraft and ships should be considered. Exemptions could also be granted for 
products and equipments intend ed for analytical purposes. 
There are no known products or equipment relying on MB, and extending the ban to 
that substance would mainly be fo r completeness and clarification.  
In terms of economic impacts , licensing remaining products and equipments would 
require minor additional administrative and enforcement effort and result in 
associated costs for the Co mmission and Member States. However, in the long term, 
a better system of information sharing, as well as a clearer proc edure, should reduce 
enforcement costs for Member States. Th ere would also be minor administrative 
costs for EC exporting businesses. Only a fe w sectors are expected  to continue such 
exports after 2010, including civil aircraft and military equipment containing halons, 
currently subject to an export authorisation (Article 12(4)). 
In terms of environmental impacts , this provision would strengthen provisions 
against illegal trade, by enabling customs to distinguish between legal and illegal trade (all new equipment).  
6.5.4.  Comparison of the Options and Emerging Preferences 
Table 11
: Options for avoiding exports harm ing the phase out in destination 
countries 
POLICY OPTIONS 
Bold: preferred regulatory option 
Italics: preferred  non-regulatory option 
Strikethrough : discarded option 
*option implemented through other EC
 legislation  
Environmental 
Impacts 2010-2020 
(ODP tonnes)  
Administrative Costs 
(€million, NPV 2010) 
Direct Economic 
Impacts  
(€million , NPV 2010 ) 
Social and Other 
Impacts 
(Million Jobs ) 
1. Preventing the issuing of export 
licenses for unwanted ODS  0-5 + 0 +1 
2. Establishing an export notification 
procedure for all ODS  0-10 ++ 0 +1 
3. Extending the ban on ODS exports to 
MB and HCFCs for destruction + 0 - +1,3 
4. Introducing export licensing per shipment  0-130 0.17 0 +1 
 
EN 45   EN 5. Extending the ban on exports of 
products and equipment to HCFCs and 
MB and licensing remaining products 
and equipment  0-95 + + +1,2 
Total impacts related to preferred options  0-100  + 0 +1,2 
1. Reduction in illegal/harmful trade 
2. Reduced ODS banks in developing countries 
3. Possible job increase 
Option 2  was discarded as it is likely to impose high administrative costs with 
comparably low benefits. Options 1 and 3  are recommended as low cost options 
which would strengthen the EU ability to control illegal and harmful trade. Non-
regulatory option 4  is likely to be the most e ffective for improving control over 
exports. It would entail an administrative cost, but would also lead to savings in 
terms of reduced reporting requirements on exports for companies. 
As illegal trade is currently one of the main challenges for enforcing the Montreal 
Protocol, option 5  is recommended, with exemptions limited to ships and aircraft 
where necessary to avoid excessive economic costs, and licensing for controlling the 
remaining exports under these exemptions. 
7. ENSURING FUTURE CHALLENGES ARE BEING ADDRESSED  
7.1. Avoiding Emissions of ODS "Banke d" in Products and Equipment 
7.1.1.  Definition and Drivers of the Problem 
By 2010, ODS “banked” or contained in products and equipment within the EU 
could amount to 700 000 ODP-tonnes.35 Assuming an overall leakage rate of 3.5 % 
(derived from the 2005 TEAP reports), EU ODS emissions from such banks could 
potentially range around 24 000 ODP tonnes p.a. for the period until 2015 (or 170 million tonnes of CO2
eq p.a.).36 
In principle, most emissions from ba nks could be avoided based on existing 
provisions in the EU Waste Framework Directive (WFD)37, the Waste from Electric 
and Electronic Equipment (“WEEE”) Directive38, the Directive on the landfill of 
waste39, related Member States’ national wast e legislation as well as provisions 
contained in the Regulation (Articles 16 and 17). Recent assessments of waste management policies in the EU, however, poi nt at generally weak recycling rates, 
below 30%, for products and equipment.  
                                                
 
35 Experts acknowledge that these estimates cont ain a relatively large degree of uncertainty. 
36 These estimates were derived by extrapolating from best available global estimates contained in a 2005 
TEAP report and according to which global banks amounted to 3.5 million ODP tonnes (20 billion tonnes CO2eq) in 2002 whilst the projected amounts for 2015 would be reduced to 2 million ODP 
tonnes (13.4 billion tonnes of CO2eq). 
37 Directive 2006/12/EC of the European Parliament and of the Council of 5 April 2006 on waste, OJ L 
114, 27.4.2006, p 9. 
38 Directive 2002/96/EC of the European Parliament and of the Council of 27 January 2003 on waste from 
electrical and electronic equipment (WEEE), OJ L 37, 13.2.2003, p. 24. Directive as amended by 
Directive 2003/108/EC (OJ L 345, 31.12.2003, p. 106). 
39 Council Directive 1999/31/EC on the landfill of waste 
 
EN 46   EN Considering these low recycling rates,  annual emission from ODS banks would 
amount to approximately 17 000 ODP-tonnes (122.5 million tonnes of CO2 eq p.a.).  
With projected annual emissions from OD S banks of 17 000 - 24 000 ODP-tonnes, in 
comparison to emissions from post-2010 cont rolled uses of ODS of approximately 
1.000 ODP tonnes, improving recovery of ba nked ODS is a key issue to address 
within the EU. Overall emissions during the period 2010-2020 are expected to be 
around 200 000 ODP-tonnes. 
Figure 4 shows that, in 2010, 90% of banked ODS will be in CFC- and HCFC-blown 
foams, with the remainder being mainly CF Cs in refrigeration and air conditioning 
systems, including mobile air containing systems. 
Whilst Austria and Sweden commissione d studies on the amounts of ODS in 
building foams,40 no clear action to recover ODS from building wastes is expected in 
the immediate future. There exists no EU legislation specifically targeting ODS in 
building and demolition waste streams. In Member States, the level of recycling and re-use of building waste varies  greatly (between 5% and 90%).
41 Furthermore, 
current practice in managing building and demolition waste recovery is not appropriate for addressing ODS  contained in (insulation)  foams. After some basic 
on-site separation (bricks and concrete) bu ilding and demolition waste is transported 
in bulk to the waste treatment plants wher e it is sorted through sieving machines. 
ODS are emitted from the foams when they are damaged during collection, sorting and shredding processes. Existing provision s should therefore be strengthened, or 
new measures developed, to ensure that in sulation foams are separated from building 
waste at an early stage and delivered, w ith minimum damage, to appropriate waste 
management sites for subsequent ODS recovery, recycling, reclamation, or 
destruction. 
Figure 4:
 Banked ODS by substance 
EU ODS Banks 2010
REF
6%RA C
2%MA C
2%
FOAM
90%OTHER
0%
 
Other banks of ODS are, to a large ex tent, covered by the WEEE Directive which 
establishes producer re sponsibility for the co llection and recovery at end of product 
life. However, a recent study for the review of the WEEE Directiv e suggests that, for 
the EU27 in 2005, only 27% of refrigerators and freezers were collected at their end-
                                                 
40 Richard Obernosterer, Roman Smutny and Erika Jäger, Nachhaltige FCKW – Bewirtschaftung 
Österreich , Final report to Österreichisches Bundesministeriums für Land- und Forstwirtschaft, Umwelt 
und Wasserwirtschaft (BMLFUW), June 2005; Peter Norderg, EcoManagement, Kartläggning av 
kvarvarande områden med ozonnedbrytande ämnen och uppföljning , 2002. 
41 Report on Data gathering and impact assessment for a review and possible widening of the scope of the 
IPPC Directive in relation to waste treatment activ ities) –Factsheet E3 – Sorting of construction and 
demolition waste, VITO and BIO,  with IEEP and IVM, 2007 
 
EN 47   EN of-life.42 Where "best practice" is implemente d, about 90% of the ODS is recovered 
from the fridges and freezers and sent to r ecycling plants but, according to estimates 
by RAL, an organisation that establishes standards for refriger ator recovery, only a 
few Member States reach those standards.43 
Finally, the analysis undertaken in the cont ext of this review revealed that costs 
associated with the recovery, recyc ling, reclamation, and destruction vary 
significantly (ranging between 4.5 and 100 €/kg ODS) depending on the recycling 
levels achieved. 
7.1.2.  Description of Options  
The considered options aim to mitigate emissions from ODS Banks. Whilst some 
options relate to the Regulation, it is clea r from the analysis that action should also 
be taken to improve the implementation and enforcement of other EU waste legislation
44.  
Option 0: No EU action 
Option 1: Adapting the ODS Recovery  Provisions in the Regulation  
Option 2: Strengthening Policies on Building and Demolition Waste 
Option 3: Strengthening the WEEE Directive 
Option 4: Developing Incentive Mechanisms for Promoting the Implementation of 
Waste Legislation. 
Option 0: No EU action 
ODS "banked" in products and equipmen t would be gradually emitted to the 
atmosphere, at an average estimated rate  of about 17 000 ODP-tonnes per year (equal 
to 122.5 million tonnes of CO2 eq p.a.).  
Option 1: Adapting the ODS Recov ery Provisions in the Regulation  
This option would “fine tun e” the Regulation, notably th rough the following changes 
to Articles 16 and 17 on recovery of us ed controlled substances and leakage: 
(1) For the purpose of clarifying the Regulat ion and streamlining with relevant 
provisions in other chemical and waste legislation, a revise d Article 16 will 
include a cross-reference to the rele vant chemical and waste legislation.45 For 
                                                 
42 United Nations University et al, 2008 Review of Directive 2002/96 on Waste Electrical and Electronic 
Equipment (WEEE) , 5 August 2007, p. iv and elsewhere. The study used a top-down approach to 
estimate the share of refrigerators and freezers base d on the level of overall WEEE waste collection.  
43 Although Member States report ODS recovery data annually to the Commission, detailed data are not 
available, as reported data do not refer to the specific sources of the ODS recovery. 
44 For the purpose of the review of the Regulation, the development of options for avoiding emissions 
from banks focuses on domestic EU options. It is acknowledged that international action is equally 
important. The issue of banks already featured during  Parties’ dialogue on the future of the Protocol. 
The European Commission and Member States will actively contribute to developing suitable 
international solutions in this context and, where relevant, also in the context of the UNFCCC/KP. 
Some international policy options that are emerging in the context of the Montreal Protocol, include 
establishing a dedicated seed capital window under the Multi-Lateral Fund or using flexible off-set 
mechanisms to fund ODS recovery and destruction projects in developing countries. 
45 Possible acts for cross-referencing include Commission Decision 2000/532/EC establishing a list of 
waste following Council Directive (91/689/EEC) on hazardous waste, or Council Direct ive 1999/31/EC 
on the landfill of waste. 
 
EN 48   EN the purpose of raising awareness on available technologies for destroying 
ODS, a revised Article 16 will be complemented by an Annex listing the technologies approved by the Parties to the Protocol.  
(2) To gradually strengthen the provisions in line with technol ogical progress, a 
legal basis will be introduced for listing products, installations, and 
equipment for which the recovery of ODS is considered "practicable", i.e. technically and economically feasible.  
(3) For the purpose of increasing synergie s across EU legislat ion, a legal basis 
should be created to align requirement s for personnel qualifications for leak-
checking and handling of substances  under the Regulation to similar 
requirements in other EU legislatio n (e.g. Regulation (EC) No 842/2006 on 
certain fluorinated gases).  
Option 2: Strengthening Policies on Building and Demolition Waste 
From the problem analysis, it clearly emerge s that solutions to the problem of banks 
are to be found in the waste policy area, notably through improving the 
implementation of recycling and recovery of ODS in the construction and demolition waste stream.  
Whilst pursuing such policy options falls out side the scope of the present review, 
some actions taken outside the EU can offe r guidance for increasing the recovery of 
ODS from foams. For example, Norway amended its legislation on recovery and 
treatment of waste, now requiring producers of waste from the demolition of large building sites to prepare plans for the adequate separation and treatment of waste components such as insulation foams containing ODS.
46 These plans are expected to 
include the destruction of ODS in such foams47. The issue has also been studied in 
Japan. This has lead to provisions fo r promoting voluntary actions under the 
Japanese Construction Ma terial Recycling Law.48 
Option 3: Strengthening the WEEE Directive 
Whilst the nature of the ba nks clearly points towards th e need for urgent action 
related to ODS-blown foams, there is also a need to improve the recovery of ODS contained in electric equipment such as fridges and freezers. This could be achieved 
by strengthening the provision s contained in the WEEE directive, notably by 
inserting a standard in the form of a mi nimum recovery rate for ODS contained in 
waste products and equipment and by enlarg ing the scope of WEEE to include larger 
installations, such as commercial refrig eration and air conditioning systems.  
Option 4: Developing incentive mechan isms for promoting the implementation 
of the waste legislation. 
The low recycling rates of waste in genera l and ODS in particular may be partly 
explained by the costs involved in mee ting the stated policy objectives. The high 
variation in costs mentione d in section 7.1.1 points toward s the need to consider 
using incentive mechanisms for improving the implementation of waste management 
policies. Examples that merit further study include making de struction facilities 
                                                
 
46 Outline of Chapter 15 of the Norwegian Regulation on Recovery and Treatment of Waste (“Waste 
Regulation” – “Avfallsforskriften”). 
47 Sophia Mylona, Norwegian Pollution Control Authority: personal communication, November 2007 
48 TEAP, Report of the Rigid and Flexible Foams Technical Options Committee, 2006. 
 
EN 49   EN eligible for financial support from the re gional funds, and developing offset systems 
for the quantities of ODS recovered and destroyed. Despite the high GWP of the 
ODS involved, emissions of these substances  are not covered by the Kyoto Protocol. 
Therefore the EU Emission Trading Sc heme cannot readily offer a solution. 
Nevertheless, emissions trading schemes a nd other incentive mechanisms could be 
useful to promote the most cost-eff ective projects by compensating for high 
implementation costs.  
7.1.3.  Impact Analysis  
Option 1  is not expected to generate significant environmental benefits, unless a 
listing of products, installati ons, and equipment for which the recovery of ODS is 
considered "practicable" is  introduced. If such a listing was introduced, it is 
estimated that up to 14 000 ODP tonnes coul d be recovered (10%  of the expected 
emissions from foams over the period consider ed). In any case it will cont ribute to 
overall awareness on the scale of the ODS bank problem. In addition, this option is 
likely to ensure a more uniform applica tion of destruction technologies across 
Member States. The process of updating th e list of approved technologies through 
Comitology will incur some limited administra tive costs. Benefits will also accrue 
should personnel qualified to handle othe r related hazardous materials be allowed 
also to handle ODS under the Regulation.  
Impacts related to options 2 and 3  are not included in the present impact assessment 
as these options will have to be pursued separately. However, some estimates are available on the total costs related to bringing actual levels  of recovered and 
destroyed ODS in line with current objectives  and provisions in the waste legislation. 
Costs of better handling of waste ODS- blown foams may range around € 2 billion.
49 
Impacts related to the use of market-based  incentive mechanisms as suggested in 
option 4  are not fully developed at present. Based on the experience with the EU 
ETS, and also considering the large variab ility in costs for the various products 
(ranging from €4.5 for simple destruction to €100 per ODP kg for recovery and 
destruction of ODS contained in insulation foams ), it is clear that market-based 
incentive mechanisms may offer significant re ductions in the cost of complying with 
present or strengthened waste treatment standards. Hence options for developing 
such systems, both at the na tional and EU level, should be further explored as a 
follow-up to the present review.  
7.1.4.  Comparison of the Options and Emerging Preferences 
The preference is to pursue the amendm ent to the Regulation in option 1, with 
parallel follow-up actions mainly in the areas of waste manage ment and associated 
incentive mechanisms. The latter actions are outside the scope of the present review 
exercise. The amendment to the regulation al one could bring benef its of up to 14 000 
ODP tonnes, or 112 million tonnes of CO 2eq. 
Table 12:  Avoiding Emissions of ODS "Banked" in Products and Equipment 
                                                 
49 http://ec.europa.eu/envi ronment/ozone/review.htm 
 
EN 50   EN POLICY OPTIONS 
Bold: preferred regulatory option 
Italics: preferred non-regulatory option 
Strikethrough : discarded option 
*option implemented through other EC legislation  
Environmental 
Impacts 2010-2020 
(ODP tonnes)  
Administrative Costs 
(€million, NPV 2010) 
Direct Economic 
Impacts 
(€million, NPV 2010) 
Social and Other 
Impacts 
1. Adapting ODS recovery provisions in the 
Regulation  0-14000  + 0 0(1) 
2. Strengthening policies on building and 
demolition waste * 0-7000 + + 0 
3. Strengthening the WEEE directive * 0-27000  + 0 0(1) 
4. Use of incentive mechanisms to promote 
implementation of waste legislation * 0-46000  0 + +(1) 
Total impacts related to preferred options 0-14000 + + +(1) 
1. Significant additional climate change benefits 
7.2. Avoiding the Marketing of New and Short-lived ODS 
7.2.1.  Definition and Drivers of the Problem 
A number of ODS are currently not contro lled by the Montreal Protocol. There are 
two categories: (a) substances with a know n, significant, ODP which have remained 
uncontrolled because of small production volumes, and (b) substances with an uncertain, but low, ODP (because of their short atmospheric lifetimes) and uncertain 
production levels. The substances  are being, or could be, ma rketed as alternatives to 
controlled ODS and, without appropriate m easures, production levels may increase 
to the level at which further substantial harm to the ozone layer could result.  
The current text of the Regulation permits  controls to be in troduced for any new 
substance identified by the Scientific A ssessment Panel as having significant ODP, 
and refers to Annex II for this list. However, this annex was deleted in 2003
50. 
Simple re-instatement of the Annex II woul d allow controls to be implemented for 
these substances but would not address any rise in the production and use of short-
lived substances with a low ODP. 
The second issue is which sp ecific substances should be included. In their responses 
to the questionnaire, Member States propos ed four new ODS for inclusion under the 
Regulation. One is a halon with a significant ODP. The three others are short-lived in 
the atmosphere and have low ozone depleti ng potentials. Concern would arise only if 
these substances came to be pr oduced in large quantities.  
7.2.2.  Description of Options  
Option 0: No EU action 
Option 1: Monitoring of new short-live d ODS with low ODP and prohibition of 
new ODS with a significant ODP 
                                                 
50 Regulation (EC) No. 1804/2003 deleted Annex II and moved the sole ODS there listed, 
bromochloromethane, to Annex I (as Group IX), stating in its recital (9) that the Annex “does not 
provide the same level of control” for this ODS as for others. 
 
EN 51   EN Option 2: Non regulatory measure: establishing li nks with REACH 
Option 0: No EU action 
Without any restriction the market for new an d short-lived ODS woul d rise to its full 
potential value. The projected total unres tricted production of the three short-lived 
new substances for the period 2010 to 2020, is 20 600 tonnes51, with a global market 
value of €17 billion (2010 NP V) and an EU market value of €3.7 billion. A scenario 
with a significant impact could potentially reduce the pr oduction to 16 400 tonnes, 
with a decrease of the market value to €3 billion.  
Option 1: Monitoring new ODS and proh ibition of ODS with a significant ODP 
This option involves re-establishing the former Annex II, with two parts:  
(1) Part A would include new ODS that ha ve been identified by the Scientific 
Assessment Panel as having a “signifi cant ozone-depleting potential”. The 
production, release for free circulation in  the Community, inward processing 
and placing on the market or  use of these substances would be prohibited (as 
per the current Article 22 for Annex II). 
(2) Part B would include substances wh ich have been id entified under REACH 
notification and registration processe s as having a non-ze ro ODP. Producers 
and importers of substances listed in Part B would be required to report each 
year on the quantities produced, im ported, exported and destroyed. 
Listing of substances in either part of the new Annex II would be subject to 
Comitology. In this review, one new ODS (dibromodifluoromethane - or halon 1202) 
would be included in Annex II.A and thr ee new ODS would be included in Annex 
II.B: n-propyl bromide; ethyl bromide; and trifluoroiodometha ne (trifluoromethyl 
iodide or CF 3I).  
Option 2: Establishing links with REACH (Non regulatory measure) 
This option would require an appropriate le vel of information exchange to ensure 
consistency between REACH and the ODS Re gulation and an efficient use of the 
data generated under the REAC H authorisation process. 
7.2.3.  Impact Analysis  
Option 1  would generate an environmental benefit by reducing the risk of further 
depletion of the ozone layer, by banning the production of one new substance of 
significant ODP, and by allowing the monito ring of production of three other new 
short-lived substances to inform the taking of further measures at a later date if that proves to be necessary. Option 2
 would facilitate the identification of any new 
substances with a non-zero ODP. 
Option 1 , including halon 1202 in Annex II.A, would have no economic impact as 
there is no known production or use in the EU. On Annex II.B, the key question is 
whether the listing of a substa nce would influence its mark et potential. As Directive 
67/548/EEC already requires a ny substance with an ODP to be labelled as a 
dangerous substance, this additional listi ng is considered not likely to have a 
significant impact. Any impact on the market potential would, in any case, not be a 
dead-weight loss, as alternatives would be developed to replace these substances. 
                                                 
51 Estimated assuming an ODP of 0.01 
 
EN 52   EN Administrative costs related to the new reporting requirements are estimated to be 
€ 0.05 million for industry, and € 0.03 m illion for the Commission. Additional 
subsequent studies may be required to  monitor new ODS contained in imported 
products and equipment. Option 2  would cause negligible  administrative costs. 
No significant social impact was identified. 
7.2.4.  Comparison of the Options and Emerging Preferences 
Table 14:  Avoiding the Marketing of New and Short-lived ODS 
POLICY OPTIONS 
Bold: preferred regulatory option 
Italics: preferred non-regulatory option 
Strikethrough : discarded option 
*option implemented through other EC legislation  
Environmental 
Impacts 2010-2020 
(ODP tonnes)  
Administrative Costs 
(€million, NPV 2010) 
Direct Economic 
Impacts (€million) 
(NPV 2010) 
Social and Other 
Impacts  
Re-establish former Annex II, part A and B  + 0.12 + 0 
Establishing links with REACH + + 0 0 
Total impacts related to preferred options + 0.12 + 0 
Both options appear beneficial compared to  business as usual, and are not mutually 
exclusive. Option 1 , in particular, provides envir onmental benefits in terms of 
reduced risks of ozone depletion, without a significant economic impact on industry. 
7.3. Avoiding Using Methyl Bromide (MB) for Quarantine and Pre-shipment 
purposes 
7.3.1.  Definition and of Drivers of the Problem 
Though the placing on the market and use of MB  for controlled uses in the EC have 
been phased out, quarantine and pre-shipment  (QPS) applications of this ODS are 
still allowed under the Regula tion. QPS applications ar e mainly for phytosanitary 
purposes, to prevent the spread of plant di seases and pests through exports of plants 
and plant products. Such phytosanitary treat ments are governed by the International 
Plant Protection Convention (IPPC). 
Several decisions of the Parties under th e Montreal Protocol and a Recommendation 
under the IPPC call for reducing QPS use of  MB. Alternatives exist for many types 
of QPS treatments: in a 2004 survey, Part ies to the Montreal Protocol reported 
widespread availability of alternatives. However, the same study noted that “cost, 
location of facilities, and lack of acceptanc e by trading partners are impediments to 
their implementation”. 
Specific concerns regarding the use of MB  for QPS in the EC include its misuse 
when QPS conditions are met, and the c ontinuation of emissive uses even though 
both a Decision of the Parties and the curre nt ODS Regulation ca ll for minimising 
emissions of MB during QPS treatments.  
MB is currently under review under the Plan t Protection Products Directive (PPPD). 
It is highly likely that a decision for not  including it in the list of authorised 
pesticides will be taken by the end of 2008. If this is the case,  all phytosanitary 
applications of MB, including QPS, will have ended by the beginning of 2010. 
 
EN 53   EN Description of Options  
Option 0: No EU action 
Option 1: End QPS uses of MB in 2010 
Option 2: Require mandatory recapture and recovery during 2010-2020 
Option 3: Require mandatory recapture up to 2015, and phase out thereafter 
Option 4: Cap QPS use at the Effective level 
Option 5: Awareness raising and action at international level 
Option 0: No EU action 
Under the baseline scenario, it is assumed that the use of MB for QPS, which has 
been relatively stable from 2004 to 2006, re mains at the current  level, around 220 
ODP tonnes per year. If MB is de-register ed under PPPD, the base line is 0 use of 
MB for QPS, and not of the options considered would have an impact.  
Option 1: End QPS uses of MB by 2010 
This option would ban the use of MB for QPS uses when the new regulation enters 
into force, leaving heat treatment as the only method meeti ng the international 
standard under the Internationa l Plant Protection Convention.  
Option 2: Require Mandatory Recapture and Recovery from 2010 to 2020 
The Regulation specifies that all precautionary measures pr acticable shall be taken to 
prevent and minimise leakages of MB. R ecapture and recovery of MB is however 
not widely implemented in the EU, whic h could therefore be made mandatory. 
Option 3: Require mandatory recapture up to 2015, and phase out thereafter 
This option would phase out the use of MB for QPS in  2015, and require mandatory 
recapture and recovery when MB is used up to 2015. 
Option 4: Cap QPS use at the Effective level 
While the overall cap for QPS use of MB in Annex III is currently set to 607 ODP 
tonnes, Article 4(2)(iii) sets limits on individual imports which resulted in an 
effective cap of 515 ODP tonnes in 2006. This  option would set the cap in Annex III 
of the ODS Regulation to this lower effective cap.  
Option 5: Awareness raising and action at international level 
This option comprises two non-legislative measures: 
(1) Developing guidelines for best pr actice based on a Commission study of 
current QPS uses of MB within the Community. Th e study should review the 
situation in third countries for the purpose of establishing a clear list of situations where MB is required. The resulting guidelines could ultimately 
help specifying a limited list of permitted QPS situations in which MB can be used and for reviewing the cap contained in the regulation.  
(2) Support efforts underway, both under the M ontreal Protocol and the IPPC, to 
reduce QPS uses of MB. This support could be provided both through international negotiations and by suppor ting international studies, standards 
and guidelines on the topic. 
 
EN 54   EN 7.3.2.  Impact Analysis  
Option 1 : During the consultation, three Memb er States proposed an end to QPS 
uses, arguing that alternatives existed, and two other Member Stat es underlined that 
they had phased out the use of MB. If MB is de-registered under the Plant Protection 
Products Directive (PPPD), all QPS uses would end. The TEAP's Methyl Bromide 
Technical Options Committee has identified many alternative treatments for various perishable and durable commodities. The most important use of MB is for the 
treatment of wood packaging, for which the international standard under the IPPC 
(ISPM 15) specifies only tw o types of treatment: MB an d heat treatment. For the 
assessment, heat treatment of containers  is therefore considered as the sole 
alternative. 
Estimates of the costs of heat treatmen t for QPS range from approximately €75 to 
€150 per container, which should be compar ed to an average cost of €105 per 
container for treatment with  MB. Assuming an average qu antity of MB used per 
container of 3 kg, an average cost of €110 pe r container, and the continuation of the 
current use of 220 ODP tonnes, the additional cost of heat treatment instead of MB 
would be €7.4 million (NPV at 2010), for a net amount of MB saved over that ten 
year period of 2200 tonnes. 
However, in their comments on the prel iminary study for this Impact Assessment, 
the European Methyl Bromide Association stated that some of the shipments that arrived in ports directly on untreated pallets  could not be effectively heat-treated, MB 
being then the only solution. If this is the cas e, the overall cost of this option could be 
significantly higher. 
Option 2: Belgium specifically requires the recovery of MB  from all QPS 
applications. Based on this experience, co sts of an EC-wide mandatory requirement 
for recapture and recovery can be estimated. In Belgium, the costs for MB treatment vary from winter (when the substance need s to be heated before application) to 
summer. Treatment methods with recapture  are competitive with winter prices, 
though significantly higher than summer prices. As a high estimate, costs for 
treatment with recapture may be 25%  above current treatment costs.  
Under current internat ional phytosanitary rules, at least 50% of the MB applied 
should remain in the contai ner 24h after fumigation. It is assumed that this is 
therefore the minimum quantity that can be  recovered for new use. Current systems 
can recapture over 99% of this share – however, doing so  requires several hours, and 
the resulting personnel costs are not compe titive with simple dega ssing and release to 
the atmosphere. Belgium requires a recaptur e rate of 80%, which current equipment 
can achieve in under an hour. The effective recapture is theref ore 40% of the MB 
originally placed in the container. The estim ated cost of treatment with recapture is 
therefore €135.75 per container, with a ne t use of MB of 1.8 kg per container, 
compared to a cost without recapture of €105, and a net use of 3 kg. The additional cost of recapture and recovery over the te n year period is therefore €26 million (NPV 
2010), for a MB emissions reduction of 880 ODP  tonnes. In practice, the higher cost 
of recapture and recovery would make heat  treatment competitive in many situations, 
and the likely switch to this alternative would reduce the overall cost to industry. 
Assuming that 20% of containe rs are not heat-treated, th e overall cost to industry 
would be €11.15 million over the period 2010-2020, with MB emissions reduced by 1 850 ODP tonnes. 
 
EN 55   EN Option 3 : This option would combine the im pacts of option 2 up to 2015, and of 
option 3 from 2015 to 2020. However, more alte rnatives are likely to be available by 
2015, and adopted as agreed measures under  ISPM-15, thereby reducing the overall 
costs of the measure. It is estimated that the amount of MB saved would be 2000 
ODP tonnes over the whole peri od considered, and the cost to industry would be €9.5 
million. Although companies may be reluctant to  invest in a technology if MB for 
QPS is likely to be phased out in the s hort to medium term, recapture technologies 
are generally designed to operate with ot her fumigants, and development is under 
way to widen the range of fumigant s for which they are operational. 
Option 4 : Because current use (slightly over 200 ODP tonnes in 2006) is below the 
level of the effective cap, this would not create direct costs fo r EC exporters or 
fumigators. It would mainly clarify the cap on the use of MB, should there be 
increases under ISPM-15 due to furthe r development of trade. Additional 
environmental benefits would be accr ued through the existing provision in the 
Regulation for the cap to be further adjusted by comitology 
Option 5 : By setting EU guidelines for best practice, standards of use should rise, 
and the associated health and safety risks fall. This impact may be limited, as the 
standards would be voluntary. At the same time, EU best practice may have a wider 
impact by influencing practices in other parts of the world. Developing guidelines 
would represent an administrative cost fo r the Commission. The impact of action at 
international level is difficult to evaluate  in terms of economic cost, but would have 
an effective environmental impact both in the EU and globally. 
7.3.3.  Comparison of the Options and Emerging Preferences 
Table 13:  Avoiding Emissions of ODS "Banked" in Products and Equipment 
POLICY OPTIONS 
Bold: preferred regulatory option 
Italics: preferred non-regulatory option 
Strikethrough : discarded option 
*option implemented through other EC legislation  
Environmental 
Impacts 2010-2020 
(ODP tonnes)  
Administrative Costs 
(€million, NPV 2010) 
Direct Economic 
Impacts 
(€million, NPV 2010) 
Social and Other 
Impacts 
1. End QPS uses of MB  by 2010  0-2200  - ++ +(1) 
2. Require mandatory recaptur e and recovery  
from 2010 to 2020  0-1850  0 0-11.1  +(1 
3. Require mandatory recapture up to 2015, 
and phase out thereafter  0-2000  - 0-9.5  +(1) 
4. Cap MB for QPS to effective level + - 0 + 
5. Guidelines and awareness raising  + + 0 +(1) 
Total impacts related to preferred options 0-2000 - 0-9.5 +(1) 
1. Reduced health and safety risks 
 
EN 56   EN Options 1 and 2  are mutually exclusive. Although heat treatment seems generally to 
be more cost-effective than recapture and recovery of MB, it is not recommended to end the use of MB for QPS immediately as  heat treatment does not cover all cases 
where treatment is needed. By 2015 however , more alternatives are likely to be 
available, reducing the cost of a phase out. Making recapture and recovery mandatory would increase the cost of MB use, and make heat treatment competitive 
in many situations. Option 3
, which is a combination of  options 1 and 2, is the 
preferred option, with MB still being allowed for QPS up to 2015 under the condition of recapture and recovery, and a complete  phase out by 2015, with more alternatives 
likely to be available by then. 
For all options, if MB is no longer author ised for phytosanitary  purposes in early 
2010, as is currently likely, the impact would be 0. 
In their response to the consultation on the review study, the European Methyl 
Bromide Association stated that they would not be opposed to recapture and 
recovery being a condition for QPS uses.  
Option 5
 would be a low cost measure to  be taken outside  the Regulation. 
8. MONITORING AND EVALUATION  
The monitoring and evaluation of the revised Regulation will continue to rely on the 
proven reporting mechanism that is in plac e to date, both at the EU level and under 
the Montreal Protocol.  
Data indicating the progress in the phase out  and related matters will continue to be 
posted, both on the web portals of the Comm ission, Member States, and UNEP (in its 
capacity of the Montreal Pr otocol's Secretariat).  
In addition, regular meeting of the Ma nagement Committee established under the 
Regulation will continue to serve as a very useful information exchange platform and as the forum for consulting Member States on specific implementing decision for which powers have been given to the Co mmission. For the latter  purpose, the new 
scrutiny rules that will come into place will  offer further consu ltation opportunities, 
also with the European Parliament.  
In cases of non-compliance, infringement cases might be launched in line with or 
independently from the compliance regime th at is in place at the global level and 
governed by the Implementation Comm ittee of the Montreal Protocol. 
9. S
UMMARY AND CONCLUSIONS  
Appendix VI summarises all the options consid ered and their impacts (quantitative or 
qualitative depending on available data), whilst highlighting the preferred options. 
The latter are described below in relation to the specific objectives. 
Simpler and better regulation 
The package of preferred options to reduce unnecessary administrative burden and to 
clarify and simplify the Regulation, in cludes removing obsolete regulatory 
provisions, simplifying the structure of th e text, improving definitions and clarifying 
links with other policies, as well as rem oving perceived regulator y uncertainties and 
loopholes. Simplification opportuni ties were also identified in terms of reporting. To 
streamline the reporting and enable further gains through the Commission 
 
EN 57   EN centralising reporting obligations to UNEP, it is proposed that destruction facilities 
report directly to the Co mmission. Finally, ending a number of exemption and 
related processes, due to the phase out of  substances and greater availability of 
alternatives would further simplify the implementation of the Regulation. Overall, 
the proposed package would result in a mu ch simplified Regulation, and net savings 
in terms of administrative costs of nearly €4 million (NPV 2010). 
Ensuring continued compliance with the Montreal Protocol 
This package includes the implementati on of decision XIX/6 on the accelerated 
phase out of HCFCs by moving forward the production phase out of HCFCs from 
2025 to 2020 and a combination of further ac tions for strengthening enforcement of 
the Regulation, and reducing the risk of illega l and harmful trade. Rather than further 
advancing the production phase out date, vol untary agreements with industry should 
be explored. To reduce the risk of illegal us e of virgin HCFCs, restricting the use of 
HCFCs to reclaimed HCFCs only was the preferred option. Preferred options for 
strengthening enforcement include a move towards a risk-based inspection regime, labelling provisions for ODS for feedstoc k use, and for products and equipments 
while servicing, and a non regulatory measur e on training and aw areness raising. 
Options to control illegal and harmful trad e include closing a loophole for imports of 
products and equipments relying on HCFCs,  while ending the transitory exemption 
on the import ban for products and equipments manufactured before a certain date. In 
addition, a better control of exports would be  obtained through extending the existing 
general ban on ODS (and on products and eq uipments containing and relying on 
ODS) to HCFCs, as well as extending the current licensing procedure. The overall administrative burden of the package is estimated at €0.9 million 
The overall package enables better complia nce with the Montreal  Protocol, and in 
particular better control ove r illegal and harmful trade. By maintaining certain 
targeted exemption provisions any undue or  excessive costs to industry are avoided. 
Ensuring future challenges are being addressed 
Options to address future challenges focu s on avoiding emissions of ODS banked in 
products and equipments, avoiding the placi ng on the market of new and short-lived 
substances with a significant ODP, and re ducing quantities of me thyl bromide used 
for quarantine and pre-shipment purposes. Proposed options to address the issue 
within the Regulation include strengthe ning the provisions on the recovery and 
destruction of ODS in produc ts and equipment, potentia lly yielding environmental 
benefits of up to 14 000 ODP tonnes (112 million tonnes of CO
2eq). It was 
established that the most effective measures involved strengthening the implementation and enforcement of the waste policy framework, in particular 
regarding construction and demolition wast e, and better implementation of the 
WEEE directive, bringing potential additio nal benefits of 34 000 ODP tonnes (270 
million tonnes of CO
2eq). Given the wide ranging co sts depending on the type of 
banks (from €4.5 for simple destruction to €100 per ODP kg for recovery and 
destruction of ODS containe d in insulation foams), the use of incentive mechanisms 
would be appropriate, for which practical details need to be further explored. 
For reducing methyl bromide use for Q PS purposes, the option preferred to a 
straightforward ban from 2010 is to make r ecapture and recovery mandatory during a 
transition period, thereby making the altern ative method of heat treatment more 
competitive, while still allowing methyl brom ide treatment if required in specific 
situations. MB use for QPS would be fully phased out in 2015, when more 
 
EN 58   EN alternatives are likely to be  available. This measure w ould yield overall  savings of 
2000 ODP tonnes. Finally, monitoring of new s ubstances with an ODP as they come 
on the market, and banning the ones with a significant ODP is the preferred option 
for new and short-lived substances. 
Overall policy package 
In conclusion, the review of a wide range  of options led to a package aiming to 
ensure continued compliance with the Mont real Protocol, while addressing future 
challenges and simplifying the current re gulation. Building on past successes and 
opportunities for simplification, overall reduc tions in terms of administrative costs 
total nearly €3 million (NPV at 2010), w ith about €2 million accruing to industry, € 
0.7 million to Member State authorities and the remainder to the European 
Commission. Excessive direct co sts to industry were at th e same time avoided, with 
quantified impacts expected to stay below €13 million, mainly related to measures to 
reduce methyl bromide use for QPS purposes. 52 Simplification is expected to be 
particularly beneficial to SMEs which ha ve less access to specialist knowledge for 
implementing the Regulation. 
The most tangible environmental benefits in  the package are those related to reduced 
consumption and increased recovery mos tly stemming from policy actions on banks 
and QPS. These could add up to a net gain of 16 000 ODP tonnes, or 112 million 
tonnes of CO 2eq.53 Further translation in terms of reduced cancer risk would not be 
meaningful considering the small quantities involved compared to the global scale of 
the problem, and the large uncertainties around the dose- response function linking a 
unit ODP tonne to the final human and environmental health impacts. This net reduction in ODP emissions would however co ntribute to reducing the risk of further 
depletion of the ozone layer, whilst also  bringing real climate change benefits. 
                                                
 
52 Costs would be significantly lower if taking into account the likely decision to deregister Methyl 
Bromide on health grounds.  
53 In terms of global warming potential , this is equivalent to about 2% of greenhouse gas emissions in 
1990. For comparison only, reductions are equivalent to 1/10th of the reductions necessary to achieve 
the 2020 objective of cutting greenhouse gas emissions by 20% under the climate and energy package.  
 
EN 59   EN Appendix I –Glossary  
A5 Developing countries (i.e. Pa rties to the Montreal Protocol 
operating under paragraph 1 of Article 5). 
Annex VII … to Regulation EC No 2037/2000. Lists permitted  critical uses 
of halons, all other uses being prohibited. 
Assessment 
Panel A committee of experts established by the MP to advise the 
Parties. There are three: the TEAP, the SAP and the Environmental Effects Assessment Panel. Each has a number of 
subsidiary specialist committees. 
Bank The entirety of the quantity of one or more ODS currently in 
existence, whether incorporated in equipment (refrigerators) or products (foams), or recovered and stored ready for use. 
BDN Production of ODS by developed countries solely to meet the 
Basic Domestic Needs of A5 deve loping countries which have no 
production capacity of their own. 
Cap An upper limit on the quantity of ODS that can be produced, 
imported or used. 
CFC Chlorofluorocarbon, a controlled su bstance, used as a refrigerant, 
solvent and foam blowing agent. Different examples are distinguished by a number that describes their chemical composition. 
CO 2eq The quantity of a gas in metric tonnes multiplied by its associated 
global warming potential (GWP). Th is is used to compare the 
emissions from various greenhous e gases based upon their global 
warming potential. 
Consumption The quantity of ODS pr oduced plus imported, minus exported 
minus destroyed. 
Controlled substance An ODS which has its production and consumption controlled by 
the Montreal Protocol and, consequently, the Regulation. 
Critical Use A vital use of an ODS for which no alternative is available, but 
for which sufficient stocks of ODS are available. 
Emissive use A use of an ODS that results in significant emissions to 
atmosphere. 
Essential Use A vital use of an ODS for which no alternative is available. 
Exiting stocks are insufficient to meet needs and production, subject to limits agreed by a MOP, is permitted. 
Feedstock A substance (in this case an ODS) which is transformed or 
 
EN 60   EN consumed as an ingredient in a production process. 
GWP Global Warming Potential - the relative potency, molecule for 
molecule, of a greenhouse gas,  taking account of how long it 
remains active in the atmosphere. The global warming potentials (GWPs) currently used are t hose calculated over 100 years. 
Carbon dioxide is taken as the ga s of reference and given a 100-
year GWP of 1. 
HCFC Hydrochlorofluorocarbon, a c ontrolled substance, used as a 
refrigerant, solvent and foam bl owing agent. Different examples 
are distinguished by a number th at describes their chemical 
composition. The ODP of HCFCs is lowr than that of CFCs. 
Halon A controlled substance, used as a fire extinguishant. Different 
examples are distinguished by a number that describes their 
chemical composition. The ODP of ha lons is higher than that of 
other ODS. 
IPPC International Plant Protection Convention (not to be confused 
with IPPC = Integrated Pollution Prevention and Control). 
IPR Inward Processing Relief (for  ODS that are imported, but not 
placed on the market). ODS subject to IPR do not count as imported under the MP and Regulation. 
ISPM International phytosanitary m easure developed by IPPC. ISPM-
15 is a standard for import re quirements of wooden packages 
Laboratory 
use Use of an ODS as a necessary comp onent or part of a laboratory 
process. 
 
MB Methyl bromide, a controlled substance, used as a pesticide in 
farming and food storage fac ilities and for QPS fumigation. 
MDI Metered-dose inhaler. CFCs used  as the propellant in delivery of 
pharmaceutical products via an i nhaler are considered to be 
essential uses in some cases beca use of stringent safety approvals 
necessary for alternatives. Howeve r, alternatives are increasingly 
becoming available. 
MOP Annual Meeting of the Partie s to the Montreal Protocol. 
MP The Montreal Protocol on Subs tances that Deplete the Ozone 
Layer, established in 1987, now  signed by about 190 countries. 
The MP controls production and consumption of ODS. 
Non-A5 Developed countries (i.e. Par ties to the Montreal Protocol not 
operating under Article 5, but  operating under Article 2). 
 
EN 61   EN NPV Net Present Value 
nPB n-propyl bromide, an ODS which is not controlled by the MP, 
but which is marketed and findi ng increased use as a solvent. 
ODP Ozone-Depleting Potential, quantified in relation to a certain 
CFC (CFC-11) that has by definition an ODP of 1. 
ODP tonne The quantity of an ODS in tonnes multiplied by its ODP. The 
value gives an ODP-weighting to quantities produced or emitted. 
ODS Ozone-depleting substance a nd a substance with ODP > 1. 
PIC Prior Informed Consent pro cedure which governs international 
trade in waste and h azardous substances. 
POM Placing on the market. The supply of an ODS to third persons in 
return for payment or free of charge. 
Processing agent Use of an ODS as a catalyst or  solvent or otherwise as a 
"facilitator" of a chem ical or industrial process where the ODS is 
not consumed or emitted but recovered and re-used. The MP and the Regulation list the uses that  can be defined in this way. 
QPS Quarantine and Pre-shipment use. The use of MB in the 
fumigation of products in shipping containers to eliminate pests 
before export of goods, notably timber. Importing authorities require certification according to  IPPC, which mandates MB as 
one of only two options). 
Reclaim The industrial process by wh ich used or contaminated ODS is 
returned to "as-new" quality. 
Recover The process of capturing ODS for recycling, reclaim, re-use or 
destruction, thus preventing emissions to atmosphere. 
Recycle The process of basic cleaning of recovered ODS so that it is fit 
for re-use. 
SAP Scientific Assessment Panel, established to advise the Parties on 
scientific aspects of ozone layer protection. 
TEAP Technology & Economic Assessm ent Panel, established to 
advise the Parties on technical and economic issues relating to 
ODS phase-out 
SME Small and medium enterprises 
Use Utilisation of an ODS in the production or maintenance of 
equipment or products, or in processes other than as feedstock or processing agents. 
 
EN 62   EN UNFCCC The UN Framework Convention on Climate Change, which aims 
to prevent harmful human-induced climate change. The UNFCCC spawned the Kyoto Prot ocol, which set limits on 
emissions of a basket of greenhouse gases for developed countries 
Virgin HCFC HCFC of new-production standard that has not been used, 
recycled or reclaimed. 
 
EN 63   EN  
Appendix II –Key Principles and Feat ures of Regulation (EC) N° 2037/2000  
The Regulation (EC) N° 2037/2000 on Ozone  Depleting Substances is the 
Communities' main instrument for implem enting the provisions of the Montreal 
Protocol.  
The Regulation follows the principles embe dded in the Montreal Protocol by banning 
the production and consumption of the most  damaging ODS, i.e. emissive uses of 
ODS. 54 Likewise, non-emissive uses of ODS are largely exempted from control 
measures notably ODS used for feedstoc k. The Regulation is stricter than the 
Protocol where it sets quantitative limits  for the use or "placing on the market" of 
ODS and of products and equipment contai ning or relying upon banned ODS and for 
Quarantine and Pre-Shipment use of Methyl Bromide.  
Similar principles apply to all quantitative controls contained in the Regulation: ODS 
production and/or use is capped at an agreed  baseline level that  is then step-wise 
reduced at agreed intervals, and ultimatel y banned. Where a full-phase out or ban is 
in place (currently for all but for HCFCs in the EC), exemptions exist in line with the 
Protocol's provisions. “Essentia l" or "critical" use exemptions have served the need 
for flexibility in specific cases and are gr anted only if, following a review process, 
there is satisfactory proof that no techni cal and economically vi able alternatives 
exist. The EC regulatory processes build  on the provisions and decision of the 
Protocol Parties and their assessment pane ls: the levels of exempted ODS uses are 
agreed each year by the Parties to the Pr otocol or based on caps contained in the 
Regulation. These "caps" gui de the allocation of POM quota to EC producers and 
importers. Quotas are allocated through a nnual Commission decisions subject to 
requesting the opinion of the Manageme nt Committee. Producers and importers 
subsequently apply for import licences (a nd authorizations for essential use 
production) through the Commission's on-line ODS database.55 To accommodate 
industrial rationalization, quotas can be transferred amongst companies.  
Annual reporting of actual production, imports, and placing on the market of ODS by 
EC-companies enables the monitoring of  the Regulation's implementation by the 
Commission and Member Stat es, including EC compliance with the Montreal 
Protocol.  
Finally, the Regulation provides the legal ba sis for opening infringement procedures 
against Member States in case non-compliance is observed. 
                                                 
54 In the context of the Protocol, consumption equals "production + import –export –destruction of ODS". 
55 The EC licensing requirement also  covers the production and import of Methyl Bromide for the purpose 
Quarantine and Pre-Shipment treatment of pests. The present Regulation contains a dual cap, i.e. 607 
ODP tonnes 515 ODP tonnes based on average 1996-97-98 production levels. This provision goes 
beyond the Montreal Protocol which to date requires only reporting of methyl bromide use for QPS 
purposes. Furthermore, in areas where the Protocol demands reporting of ODS only (e.g. production of ODS for export to developing countries that are not yet subject to full phase-out regimes), EC 
companies have to declare planned ODS transactions which subsequently serve as caps for authorizing 
exports in the subsequent year through the ODS licensing system. 
 
EN 64   EN Appendix III –The 2010 Outlook Regarding Cont rolled Ozone Depleting Substances in 
the EU –the Baseline for Finishing the Job  
This appendix summarizes the outlook for 2010 with respect to  ozone depleting 
substances in the EU. The outlook has also  served as the policy baseline, i.e. the 
business as usual scenario against whic h other policy options are evaluated.  
By 2010, the EC will have re ached a full phase-out of controlled ODS, save for 
approximately 1 200 ODP tonnes p.a. (compa red to baseline consumption levels of 
400 000 ODP tonnes). The amount of 1 200 OD P tonnes includes an estimated 1 000 
ODP tonnes of recycled or reclaimed HCFCs which will be banned as of 2015, thus 
leaving a tail of less than  200 ODP tonnes p.a. of ODS "c onsumption" as defined by 
the Montreal Protocol.  
In addition, there will be a remaining use of  "emissive ODS uses" that are covered by 
the regulation (yet no t accounted for as consumpti on under the Protocol) amounting 
to an estimated 1 400 ODP tonnes for the period beyond 2010 (assuming that current 
levels would be maintained in the absence of further measures).  
ODS production in the EC will have reac hed less than 4 000 ODP tonnes p.a. by 
2010 (comparing to baseline production levels of 700 000 ODP tonnes).  
Further details on the 2010 outlook are prov ided below for the respective categories 
as well other features of the Regulation, su ch as expected tre nds in the licensing 
volumes processed through the online ODS  database hosted by the Commission, 
trends in the so-called In ward Processing Regime.  
Figure 2 : Remaining Emissive Uses of the ODS in the EU (Base Case Estimates for 
the period ending in 2020) 
05001.0001.5002.0002.5003.000
2008 2009 2010 2015 2020ODP-Tonnes p.a.
Essential Use CFC-MDI Critical Use MB Essential Use Laboratory & Analytical
Use of HCFC (virgin) Use of HCFC (recycled or reclaimed)*
 
The figure above illustrates the nature of the first category of remaining emissive 
uses other, notably showing that:  
(1) Critical use of Methyl Bromide for fumigation purposes will end in 2008.  
 
Following the agreement reached with Member States in 2007, the EC has not 
 
EN 65   EN submitted nominations to the Ozone Secretariat for the use of Methyl 
Bromide from 2009 onwards.  
(2) Production of CFCs for essential use in Metered Dose Inhalers will end 
after 2009.  
Following the agreement reached with Member States in 2007, the EC will 
not submitted nominations to the Ozone  Secretariat for the production of 
CFCs for essential use in Metere d Dose Inhalers from 2010 onwards.
56  
(3) The use of “virgin” HCFCs for the purpose of servicing remaining 
equipment relying on HCFCs will be banned after 2010. 
 
For the period ending in 2009, the annual placing on the market of virgin HCFC is capped at 1.870 ODP tonnes.  
(4) The use of recycled or reclaimed HCFCs will be allowed until 2015 with 
estimated demand decreasing steadily from less then 1 000 ODP tonnes.   
 
In the context of the Regulation, the "use" of HCFCs refers to the refilling or 
recharging of equipment relaying on HCFCs. Whilst the use of HCFCs for 
refilling has been grad ually banned for equipment manufactured between 
2001 and 2004 (depending on the type and capacity of the equipment) there remain a few categories for which the use ban enters into force after 2010 (e.g. commercial air conditioning and refrigeration units). Demand for recycled or reclaimed HCFCs for the pe riod starting in 2010 is estimated to 
amount to less than 1 000 ODP tonnes, decreasing to about 200 ODP tonnes towards the ban date starting in 2015.
57 It is noted that the use of recycled or 
reclaimed ODS does not count as cons umption as defined by the Montreal 
Protocol.  
(5) Essential uses for the purpose of analytical and laboratory uses will stay 
at current levels amounting to less than 200 ODP tonnes per year.  
This level is conservatively assumed to be maintained in the absence of 
further measures. TEAP regularly informs Parties on laboratory and analytical process that no longer re quire the use of ODS. Parties may 
therefore take additional decisions whereby more processes are listed for which ODS are no longer authorised. Such decisions will reduce the EC's 
annual consumption of ODS for laborator y and analytical uses through the 
existing quota and licensing procedure.  
The figure below furthermore illustrates the "other" emissive uses that will remain 
beyond 2010 albeit at equa lly low levels which were cons ervatively estimated to stay 
around present levels.  
                                                
 
56 This commitment is reflected in Decision XIX/13 adopted at the 19th meeting of the Parties in 2007. 
57 ICF international, Supply and demand or recycled HCFCs in existing refrigeration and air conditioning 
equipment beyond 2009: analysis of regulatory phase-out scenarios, August 2006. 
 
EN 66   EN Figure 2 : Other Uses of the ODS in the EU (Base Case Estimates for the period 
ending in 2020) 
02004006008001.0001.2001.4001.600
2008 2009 2010 2015 2020ODP Tonnes p.a.
Critical Use Halon (from existing stocks) Exempted Use QPS (100% emissive)
Exempted Use Process Agents (emissions) Est. Emissions related to ODS Feedstock (1%) 
From this figure, it follows that: 
(1) Critical uses of Halons will conti nue beyond 2010 at the current levels of 
ca. 500 ODP Tonnes  
Whilst production of Halon for emissive  uses is banned, approximately 500 
ODP tonnes per year are taken from (o fficial) EC and international “Halon 
banks” to serve specific cr itical (fire-fighting) uses in military, aviation, 
maritime, and oil and gas applications. These critical uses are listed in Annex VII of the Regulation. Whilst the pres ent Annex VII contains no phase out 
dates for these applications, consultations  with relevant stakeholders held in 
the context of the review of this Annex (based on Article 4(4)iv of the Regulation) have confirmed that phase out dates ranging from 2015 to 2030 for the most difficult sectors are feasib le. Hence, assuming that the revised 
Annex VII will be adopted before 2010, the levels of "critical" Halon uses are 
expected to gradually come  down to zero before 2030.  
(2) The exempted use of Methyl Bromid e for Quarantine and Pre-Shipment 
is expected to stay at the current level of ca. 200 ODP tonnes. 
 
In addition to the obligation to report on the use of Methyl Bromide for the purpose of Quarantine and Pre-Shipment (QPS) purposes, its us e if capped by 
the Regulation. Following the latest av ailable data for 2006, present amounts 
of Methyl Bromide used for QPS in the EU have come down to just above 200 ODP tonnes per annum or about 300 ODP tonnes below the current cap 
of 515 ODP tonnes based on average 1996- 97-98 production levels (and 400 
ODP tonnes below the second cap of 607 ODP tonnes contained in the Annex of the Regulation. This reduction ha s been achieved although 12 Members 
States joined the EU and trade volu mes significantly increased between the 
EC and other countries over the same period.  
(3) Emissions related to exempted us es of ODS for process agents are 
expected to stay at curren tly estimated levels of less than 20 ODP tonnes.  
 
EN 67   EN  
Uses of ODS as process agent are limite d so specific applications, defined in 
the Montreal Protocol and further restricted in Anne x VI of the Regulation. 
The list of authorised uses may progres sively be reduced in the light of 
progress in the availability of  alternative processing agents.  
(4) Emissions from ODS use for feed stock are assumed to remain 
"insignificant" with levels assume d to stay around 600 ODP-tonnes.  
 
Both the Montreal Protocol and the Regulation exempt emissions of ODS 
from feedstock reactions which treat ed as non emissive uses of ODS. 
However, as a total consumption of ODS  for emissive uses reaches very low 
levels, emissions from feedstock (estimat ed to less than 1% of the material 
used in the chemical reaction) become significant in relative terms. Best way 
to address emissions of ODS from feed stock in the EC would be to take 
measures for further minimising emissions in the framework of industrial pollution policies. Modifying the scope  of the Regulation on ODS to cover 
feedstock emission would be inconsis tent with the Montreal Protocol 
approach.  
With respect to 2010 outlook for production of ODS in the EU, the following is 
noted:  
(5) Production of HCFCs for export to s erve needs of non-EU Parties to the 
Protocol is expected to decrease from current levels of less than 4 000 ODP tonnes to zero by 2020.  
 
Albeit that the current Regulation allo ws for the production of HCFCs within 
the EU for exports to non-EU countries (where there is no ban in place yet) 
till 2025, the actual baseline date will be brought forward to 2020 as part of need to align the Regulation with the MOP19 Decision on the accelerated 
phase out of HCFC. Until then produc tion levels for export to non-EU 
countries is conservatively estimated to  stay at current levels amounting to 
approximately 4 000 ODP tonnes. In reality, these volumes tend to go down more rapidly as the ban date appr oaches and companies adapt their 
production schedules to the new market reality ahead of time.  
(6) As of 2010 the EC production of ODS to  serve so called "basic domestic 
needs" (BDN) will have decreased  to less than 100 ODP tonnes. 
 
Whilst the EC companies currently pr oduced and exported CFCs (several 
types) and carbon tetrachloride (CTC) for basic domestic needs, those BDN 
regimes will end in accordance with the provisions of the Montreal Protocol. 
As of 2010, EC companies could c ontinue producing and exporting 1,1,1-
trichloroethane until the BDN regime for this subs tance will also end in 2015. 
Current low levels of BDN 1,1,1-trichl oroethane exports (at less than 100 
ODP tonnes) are expected to drop be yond 2010 as the number of countries 
requiring imports continues to decrease.
58 
                                                 
58 Exact data are not provided as less than three co mpanies produce and export this substance for BDN. 
 
EN 68   EN As a final consideration related to the 2010 outlook, it is noted from the figure below 
that the number of licenses that are proce ssed annually through the on-line ODS data 
base system is expected to decrease to  an estimated 1 000 (from almost 3 000 in 
2002 when the system was first launched). Of this remaining total, more than 50% is 
related to so called inwa rd processing, i.e. the im porting and exporting of ODS 
(mainly Methyl Bromide) without those goods entering the EC customs area. Whilst 
in transit, goods may undergo minor transformations usually (re)packaging according to the requirements of the destination country. 
Figure 3
: Trends in Licences Pr ocessed through the ODS lice nsing System (For the 
period since its launching in 2002 estimated volumes for 2010) 
05001.0001.5002.0002.5003.000
2002 2003 2004 2005 2006 2007 2010Request for fumigation Application for production Application for recycled product Classic export authorisation
EAN for CFC MDI to non-A5 EAN for BDN EAN for Halon EAN for IPR
Export Notification EAN for essential use Import licence (IMP) IMP for MB for critical use
IMP for IPR IMP for production Laboratory supply Production authorisation
Production authorisation Ex-EU Request for use of MB stock Transfer of fumigation quota Transfer of production
Transfer of import quota 
 
EN 69   EN Appendix IV –Methods and Criteria For Assessing the Impacts  
The impacts of the different policy options were considered according to the three 
general impact assessment criteria recommended by the Commission’s impact 
assessment guidelines: economic, social and environmental impacts. In these three 
main areas, 16 specific categories were identi fied based on an initial review of the 
options and of the information and comment s gathered during the review study (see 
table [8] below).  
The full list of 16 impact categories was us ed in the qualitative analysis of options 
retained during the review study. A short list of the 10 most important impact 
categories was also identified, as pres ented in the table above. Quantified 
assessments were prepared for 6 of the 10 cat egories (these six are listed are in bold 
in the short list). The other four categorie s remain important. Wherever possible, the 
main stakeholders potentially affected by a revision to the Re gulation were also 
identified, as well as areas where opti ons are most likely to affect them.  
Since this Review takes place in the cont ext of the 'Better Regulation' initiative, 
special emphasis was put on the evaluation of  the impact of proposed policy options 
on administrative costs. The methodol ogy recommended by the impact assessment 
guidelines was adopted. Details of the a ssessments can be found in the study 
commissioned to support this impact assessment59. 
Table 3 : Impact Analysis Criteria 
General 
categories  Full qualitative analytical list Short list of categories 
Direct costs (or benefi ts) to EU industry  
(with particular consideration of SMEs) Direct costs for EU industry 
Admin. costs (or benefits) on EU business Administrative costs for EU industry 
Costs (or benefits) to downstream users 
International competitiveness 
Competition in the internal market 
Specific sectors and regions  
Innovation and research Other economic impacts 
 
Admin. costs for Member States Economic  
Public authorities: administration and  
Enforcement Administrative costs for the COM 
Employment 
Health and safety  Social 
Crime: especially illegal trade Social impacts 
Ozone layer Ozone depleting emissions 
Climate change  Greenhouse gas emissions 
Waste management 
Local impacts (on biodiversity, flora and fauna 
and water quality) Other environmental impacts Environmental 
EC Leadership in international negotiations EC position in global negotiations 
                                                 
59 See http://ec.europa.eu/en vironment/ozone/review.htm 
 
EN 70   EN Appendix V –Stakeholders' Suggested  Areas for Further Improvement  
Whilst the stakeholders' response to the surv ey was generally very  positive, several 
suggestions were submitted related to areas  where further improvements areas could 
be pursued. Considering also the internat ional challenges (see section 1.3), the 
following remaining problem areas have been defined: 
(1) Complex Regulation 
 
The main comments resulting from the survey related to the Regulation’s 
complexity and a desire for simp lification and cl arification. Many 
stakeholders commented that the current legislation is complex mainly in terms of structure (i.e. ban provisions  and exemptions treated in various 
sections), the presence of  numerous obsolete provisi ons, and provisions that 
require significant knowledge of the (international) context also due to 
definitions that are considered lacking clarity.  
(2) Extensive Reporting Requirements 
 
In their responses to th e survey for the review of the Regulation, a few 
Member States called for measures to reduce their administrative costs related 
to reporting also indicating that the ad ministrative costs associated with 
reporting appears to be one of the mo re burdensome aspects of implementing 
the Regulation requirements for Member States. In contrast, responses from 
business and industry did not cite  major concerns with reporting.  
(3) Synergies with other policies 
 
Many surveyed stakeholders called for mo re synergies with related policies 
such as the regulations on F-gases, wa ste, chemicals, plant protection and 
sanitation.  
(4) Inflexible quota and licensing procedures 
 
In their responses to th e survey for the review of the Regulation, a few 
companies suggested that the quota and licensing procedures where offering 
insufficient flexibility, notably wher e ODS production, import and/or export 
volumes deviated from forecasted amounts that had served the basis for establishing the EU maximum quota ("cap").  
(5) (Re)inforcing Import and Export Bans 
 
Nearly half of the Member States th at responded to the survey called for 
strong enforcement of import and export requirements across the EC. Likewise, several industry respondents reported cases of illegal imports of ODS, hence expressing equal concerns . A further concern related to the 
upcoming phase-out of the use of “virgin” HCFCs for the maintenance and servicing of refrigeration and air conditioning equipment could fuel illegal trade in “virgin” HCFCs.  
(6) Uncontrolled Substances 
 
 
EN 71   EN Some Member States suggested that action be consider ed to introduce 
measures for currently uncontrolled ODS  production and trade (e.g. DE, NL), 
and ODS banked in products and equipm ent. These suggestions echo the 
concerns expressed in the 2006 Report of the Scientific Assessment Panel 
established by the Parties to the Montreal Protocol.  
 
EN 72   EN Appendix VI –List of options considered and their impacts  
Environmental impact POLICY OPTIONS 
In bold: preferred regulatory option 
In italics: preferred  non-regulatory option 
Strikethrough : discarded option 
Marked with *: implemented through other EC legislation  ODP 
tonnes 
(2010-
2020) CO 2 . 
tonnes 1 
(2010-
2020) Administrative
Costs 
€ million 
(NPV2010) 
Or qualitative 
assessment   Direct 
economic 
impact 
€ million 
(NPV2010) 
Or qualitative 
assessment  Other impacts: 
Social impacts; 
Trade-offs / synergies  
1. OPTIONS FOR ACHIEVING SIMP LER AND BETTER REGULATION 
Clarifying and simplifying the Regulation 
Combined options + + -2.35  0 + (Reduced burden on SMEs) 
Streamlining reporting 
Simplified and online reporting for companies and users 0 0 -0.50 0 0 
Streamlining reporting on ODS destruction 0 0 -0.07 0 Condition for streamlined UNEP 
reporting 
Cancelling MS reporting on ODS recovery, recycling 
and reclamation, and on exempted uses of HCFCs 
replacing Halons  0 0 -0.42 0 0 
Streamlining UNEP reporting 0 0 -0.06 0 0 
Exemption regimes and related administrative processes 
Ending production of ODS for Basic Domestic Needs 0-22 2 0-32 000 2 - + 
(confidential)  - (Possible small job loss)  
 
EN 73   EN Ending IPR for MB and HCFCs in 2010 0-6475 2 0-8.7 
million 2 -0.92 + 
(confidential)  - (Possible small job loss)  
Ending exempted uses of HCFCs for replacing halons 0 0 - 0 0 
Ending exempted uses of HCFCs where no alternatives 
available  + + -0.12 + 0 
Inserted a new exempted use clause for critical uses of 
Halons - - + -- 0 
Updating the essential use process for laboratory and 
analytical uses + + -0.09 0 0 
SUBTOTAL FOR ACHIEVING BETTER AND 
SIMPLER REGULATION 0-6500 2 8.73 million -3.85 3.3 (including 
confidential 
data) - (Possible job loss)  
2. OPTIONS FOR ENSURING  FULL COMPLIANCE WITH THE MONTREAL PROTOCOL 
Options related to the accelerated HCFC phase out 
Advancing production phase out to 2020  De facto base case 
Advancing production phase out to 2010 or 2015  0-18000 0-455.2 
million - 2.3 -9.5 +  (Synergy with 'simplification')  
Options related to the HCFC use phase out 
Expedited phase out from the use of recycled and 
reclaimed HCFCs    0-600 2 0-10.9 
million 2 - ++ + (Reduced risk of illegal use of 
virgin HCFCs)  
Voluntary agreement on phase out strategy with industry + + 0 + 0 
 
EN 74   EN Certification of recycled an d reclaimed HCFCs  + + ++ 0 + (Reduced risk of illegal use of 
virgin HCFCs)  
Use of reclaimed HCFCs only after 2010 + + + + + (Reduced risk of illegal use of 
virgin HCFCs)  
Options related to strengthening enforcement 
Updating inspections provisions + + + 0 + (Reduced risk of illegal 
trade/use)  
Adapting labelling requirements for ODS for feedstock 
use + + + 0 + (Reduced risk of diversion for 
other uses)  
Extending labelling requirements to sales of products and 
equipment  + + 0.16 0 + ( Reduced risk of illegal trade; 
Increased consumer choice)  
Labelling requirements for existing products and 
equipment during servicing + + 0.92 0 + (Reduced risk of illegal trade; 
Increased consumer choice) 
Awareness raising and training programmes + + 0.08 0 + (Reduced risk of illegal trade)  
Options related to avoiding illega l imports and remaining loopholes 
Ending the import of products and equipments relying 
on ODS  + + - + Synergy with 'Simplification'  
Ending the import of products and equipments 
containing or relying on ODS manufactured before the specific use ban date + + - -2.78 + (
Reduced risk of illegal trade. 
Possible job increase ). Synergy with 
'Simplification'  
Extending licensing to entry under customs 
procedures or for customs-approved treatments  + + + 0 + ( Reduced risk of illegal trade)  
 
EN 75   EN Options related to avoiding harmful exports 
Preventing the issuing of export licenses for unwanted 
ODS + + + 0 + (reduced risk of illegal trade ) 
Establishing an export notification procedure for all ODS  + + ++ 0 + (reduced risk of illegal trade)  
Extending the ban on ODS exports to methyl bromide 
and HCFCs for destruction + + 0 - ( EU destruction 
facilities ) + (Reduction in harmful trade; 
Possible job increase) 
Introducing export licensing per shipment + + 0.17 0 + (Reduced risk of illegal trade) 
Extending the ban on exports of products and 
equipment to HCFCs and methyl bromide; licensing remaining products and equipments + + + + 
+ (Reduction in harmful/illegal 
trade/Reduced ODS banks in dev. 
countries) 
SUBTOTAL FOR ENSURING FULL COMPLIANCE 
WITH THE MONTREAL PROTOCOL ++ ++ 0.92 +  + (Reduced risk of illegal trade; 
reduced ODS banks in dev. 
Countries)  
3. OPTIONS FOR ENS URING FUTURE CHALLE NGES ARE ADDRESSED 
Avoiding emissions of ODS banke d in products and equipments 
Adapt the provisions related to the recovery of ODS 0-14000 0-112 million + 0 + ( significant additional climate 
change benefits ) 
Strengthening policies on building and demolition waste* 0-7000 0-56 million 0 + 0 
Strengthening the WEEE directive* 0-27000 0-216 million + 0 + ( significant additional climate 
change benefits ) 
 
EN 76   EN Use of incentive mechanisms* 0-46000 0-368 million 0 + + ( significant additional climate 
change benefits ) 
Options related to new and short-lived ODS 
Re-establish former Annex II, part A and B 0-500 0-15 500 0.12 + 0 
Establishing links with REACH 0-20 0-10 000 + 0 0 
Options related to QPS 
End QPS uses of MB  by 2010  0-2200 0-18 300 - ++ + ( Reduced health and safety 
risks); synergy with 'simplification'  
Require mandatory recapture and recovery 2010-2020  0-1850 0-15 400 0 0-11.1  + ( Reduced health and safety risks ) 
Recapture up to 2015 and phase out thereafter 0-2000 0-16 000 - 0-9.5 + ( Reduced health and safety 
risks); synergy with 'simplification'  
Cap MB for QPS to effective level + + - 0 0 
Awareness raising and action at international level + + + 0 + ( Reduced health and safety risks ) 
SUBTOTAL FOR ENSURING FUTURE 
CHALLENGES ARE ADDRESSED 0-16 500 0-112 
million 0.12 0-9.5  + (Reduced health and safety risks)  
TOTAL FOR PREFERRED OPTIONS 
(including quantified impacts of preferred regulatory 
options only) 0-23 000 0-120 million -2.8 3.3-13 + (reduced risk of illegal trade; 
reduced health and safety risks)  
- (possible job losses)  
1 Assuming an average GWP of 1000 wh en considering a basket of ODS. 
2 The global environmental impact depends on the degree of relocation of the activity in third countries.
 
EN 77   EN Appendix VII –Comments from the Impact Assessment Board  
As explained in Chapter 1, a draft of th is report was submitted to the Commission’s 
Impact Assessment Board on 30 April 2008. The draft impact assessment was presented and discussed at the 21 Ma y 2008 meeting of the Impact Assessment 
Board. On 27 May 2008, the Impact Assessmen t Board issued its opinion which is 
reproduced in Appendix VII. This appendix also explains  how the Board's comments 
were accounted for in th e present document.  
(A) Context 
The Montreal Protocol on Substances that Deplete the Ozone Layer (1987) mandated the phase-out of 
production of ODS by all signatory Parties according to a specific time-table (that has been modified 
five times to include additional ODS and to acceler ate the production phase-ou t). The EU regulations 
implementing the Montreal Protocol have often been more ambitious than the MP schedule. As of 2010, 
production and consumption of the most harmful (known) ODS should be completely banned in industrialized countries, except for a very limited number of exempted or non-controlled uses and a 
declining "tail" of hydrofluorocarbons. Full bans in  developing countries typically come into effect 
within 5 to 10 years following the bans in industria lized countries, although an increasing number of 
developing countries now align their policies with industrialized countries such as those of the EU. The 
revised Regulation aims at simplifying the regulatory environment. 
(B) Positive aspects 
The IA report contains a robust analysis of costs and potential ODS reductions. There is an appropriate 
range of policy options and a detailed analysis of their impacts. Simplification gains are well demonstrated. 
(C) Main recommendations for improvements 
The recommendations below are listed in order of des cending importance. Some more technical comments have 
been transmitted direct ly to the author DG and are expected to be inco rporated in the final version of the impact 
assessment report.  
General recommendation: While the IA report contains  a robust analysis of impacts, a number of 
issues deserve further clarification: scope of the problem and in particular the distinction between 
problems remaining at global level and those whic h are specific to the EU; policy objectives, trade 
offs and synergies among the sub-options. Additionally, the report should make a monetised 
estimate where relevant of expected enviro nmental benefits, and clarify who will bear 
administrative costs.  
(1) The problem definition section should bett er explain the difference between global and EU 
specific problems.  The IA should where possible describe the problems in more concrete terms – e.g. by 
assessing each of them in terms of administrative costs or to nnes of ODS. This should be reflected in a 
clearer prioritisation of the problems which in turn should be reflected in the objectives.  
(2) Analysis of benefits and certain impacts could be strengthened . The report is based on a cost 
effectiveness analysis rather than a full cost-benefit analysis. the IA report should nevertheless attempt to 
provide monetised estimates of the expected environmental benefits. Given the links to broader climate 
change policies, it should also express these benefits in terms of CO 2 reductions. Discussion on 
methodological difficulties, and experience in third coun tries (US) should be included in the IA report. 
Additionally, the administrative costs should be brok en down to show who will bear them (companies, 
SMEs, public authorities, etc). The IA should also ex plain what is included under the category "direct 
economic impacts".  
(3) Objectives need to be redrafted . The objectives contained in section 3.1 should rather be moved to 
the section on the context, so that the IA report make s it clear that proposed ac tions concern only the EU. 
Additionally, one should consider developing SMART objectives (section 3.2), in order to facilitate 
future evaluation of the policy.  
(4) Synergies and trade-offs between op tions should be more clearly presented . The disaggregation 
of the general policy options into a large number of sub-options makes it difficult to follow the potential 
synergies and trade-offs among them. The IA report could aggregate some of the individual options, in particular in cases where all of them relate to the same action and are retained in the final policy 
 
EN 78   EN package, and expand information contained now in th e table in the annex. Additionally, options that are 
not compatible with the Montreal Protocol should not be analysed.  
(D) Procedure and presentation 
The report exceeds 30-page limit. All other proced ural requirements seem to be complied with.   
All recommendations for improvements have been accounted for in the final version 
of this impact assessment, as described below: 
General recommendation: the scope of the problem, policy objectives, trade-offs 
and synergies were clarified, as explained in more detail below.  Environmental 
benefits were quantified as far as possibl e, and the distribution of administrative 
costs across categories was hi ghlighted in the conclusion. 
(1) The problem definition section shou ld better explain the difference between 
global and EU specific problems. 
The contextual description of global cha llenges was moved to th e section describing 
the background. Problems at the EU level we re quantified in terms of administrative 
costs or tonnes of ODS, and prioritised accordingly. 
(2) Analysis of benefits and certai n impacts should be strengthened. 
Environmental impacts were further qua ntified where meaningful and both ODP 
tonnes and CO 2 equivalents were included in appendix VI. The difficulty of 
monetising the benefits was described in section 3.3. Mo re information was also 
given on the methodology for estimating dire ct economic impacts. Administrative 
costs were broken down in different categor ies and the distribution was summarised 
in the conclusion.  
(3) Objectives need to be redrafted .  
Section 3 was re-organised to highlight th at objectives focus on the EU level, and 
objectives were redrafted to make them more operational. 
(4) Synergies and trade-offs between opti ons should be more clearly presented. 
The range of options considered was simp lified by removing options that were not 
compatible with the Montreal Protocol , and individual options were further 
aggregated when relevant (e.g. sections  5.2, 5.3, 6.1 and 6.4). Synergies and trade-
offs were summarised in the last column of  the appendix VI tabl e. In one instance, 
this analysis led to cons idering a third option, combin ing two mutually exclusive 
options in separate periods of time (section 7.3).