EN    EN EN 
 
EN    EN  COMMISSION OF THE E UROPEAN COMMUNITIES 
Brussels, 1.8.2008 
SEC(2008) 2367 final 
COMMISSION STAFF WORKING DOCUMENT 
Reviewing Regulation (EC) No 2037/2 000 on substances that deplete the 
ozone layer  
 
"Better regulation building on 20 years of success"  
 
Summary of the impact assessment accompanying the proposal for a 
Regulation of the European Parliame nt and of the Council on substances 
that deplete the ozone layer (recast)  
 
 
[COM(2008) 505 final] 
[SEC(2008) 2366] 
 
EN 2   EN COMMISSION STAFF WORKING DOCUMENT 
Reviewing Regulation (EC) No 2037/2 000 on substances that deplete the 
ozone layer  
"Better regulation building on 20 years of success"  
Summary of the impact assessment  
accompanying the proposal for a Regu lation of the European Parliament 
and of the Council on substances tha t deplete the ozone layer (recast)  
 
 
[COM(2008) 505 final] 
[SEC(2008) 2366] 
 
EN 3   EN 1. INTRODUCTION  
This document provides an executive summary of the impact assessment 
accompanying the recast of Regulation (EC) No 2037/2000 on substances that 
deplete the ozone layer (hereinafter  referred to as “the Regulation”)1.  
2. BACKGROUND  
The stratospheric ozone layer shields life on  earth from harmful ultraviolet radiation 
from the sun. In the early 1980s, scientists  observed a significant decrease in the 
concentration of ozone in the stratosphere  over the Antarctic, which became widely 
known as the “ozone hole”. At its peak – during spring in the late 1990s – the ozone 
hole was most severe around the poles, al though concentrations were significantly 
reduced in other places as well. Increased UV radiation has an adverse impact on humans (skin cancers and cataracts) and ecosystems. 
As early as 1987, governments agreed on the Montreal Protocol on Substances that 
Deplete the Ozone Layer, thereby star ting the phase-out of ozone-depleting 
substances (ODS) in all signatories followi ng a set timetable. In 2007, as the Parties 
(including the European Co mmunity) celebrated its twentieth anniversary, the 
Montreal Protocol was wi dely hailed as one of th e most successful of all 
international environmental agreements. By then, all 191 Parties had achieved a 95% 
reduction in consumption of ODS co mpared with the baselines set.
2 Reductions were 
highest (99.2%) in industrial ised countries and somewhat lower (80%) in developing 
countries. Reductions were achieved on the basis of agreed consumption and production freezes and subsequent ti me-bound step-by-step reductions.
3 
In its latest report, released in 2 007, the Scientific Assessment Panel (SAP) 
established under the Montreal  Protocol confirmed that the ozone layer is slowly 
recovering thanks to the control measures introduced by the Protocol – albeit 10 to 
15 years behind the projections  in its earlier 200 2 report. Average and Arctic ozone 
levels are expected to re cover by 2050 and the Antarctic  ozone hole by between 2060 
and 2075.  
According to UNEP, controls introduced under the Montreal Protocol will avoid 
millions of fatal skin cancers and tens of millions of non-fatal skin cancers and 
cataracts worldwide. The US authorities es timate that more than 6.3 million skin 
cancers will be avoided in the USA alone. Furthermore, the controls introduced by the Montreal Protocol will help to avoi d greenhouse gas emissions equivalent to 
more than 100 billion tonnes of CO
2 between 1990 and 2010. By 2010, GWP-
                                                 
1 See SEC(2008) xxx and COM(2008) xxx 
2 Article 1 of the Montreal Protocol defines "Consumption" as production plus imports minus exports of 
controlled substances. 
3 Successful reductions in developi ng countries have been made po ssible by the Multilate ral Fund which 
to date has channelled about US$2.4 billion into te chnology transfer and re lated capacity-building 
projects. Timetables for developing countries typically lag a few years behind those of industrialised 
countries. 
 
EN 4   EN weighted ODS emissions will account fo r less than 5% of  global projected CO 2 
emissions compared with nearly 50% in 1990.4  
3. REGULATION (EC)  NO 2037/2000  ON SUBSTANCES THAT DEPLETE THE OZONE 
LAYER  
The Regulation is the European Communities’ main instrument for implementing the 
Montreal Protocol. The clos ely matching and mutually reinforcing international and 
EU policy frameworks have an impressive track record, showing an almost complete 
phase-out of consumption and production of the controlled ODS (see the figure 
below).  
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
  
To date, the EC has phased out more th an 99% of its base line consumption and 
production of ODS. By 2010, th e EC will have fully phased out controlled ODS uses, 
save for approximately 1 200 ODP tonnes per year . This figure of 1 200 tonnes 
includes an estimated 1 000 t onnes attributable to recy cled or reclaimed HCFCs 
which will be banned from 2015 on, leavi ng less than 200 ODP tonnes per year 
defined as consumption under the Montreal  Protocol (compared with baseline 
consumption levels of 400 000 tonnes). In addition, remaining “emissive uses” of 
ODS covered by the Regulation (but not yet counted as consumption under the 
Protocol) will add up to an estimate d 1 400 ODP tonnes for the period beyond 2010 
(assuming that current levels are maintained  in the absence of further measures). 
ODS production in the EC will be down to less than 4 000 ODP tonnes per year by 2010 (compared with baseline produc tion levels of 700 000 tonnes).  
4. T
HE REVIEW PROCESS  
This review is included in the 2008 Commission Legislative and Work Programme  
(CLWP) under the heading “Sim plification”. Preparations started at the end of 2006 
                                                 
4 These big contributions to climate change are due to the very high global warming potential (GWP) of 
ozone-depleting substances (some of which are more than 14 000 times more potent than CO 2). 
 
EN 5   EN with the launching of an extensive survey  of Member States’ authorities and other 
relevant agencies, companies, industrie s and non-governmental organisations. The 
survey showed general satisfaction with the effectiveness of the Regulation. The 
main comments related to the Regulation’s complexity and a desire for simplification 
and clarification.  
Based on the above-mentioned input and othe r expert sources (e.g. latest analyses 
and recommendations from the Montreal Protocol’s Scientific, Technical and 
Economic Assessment Panels), policy options  and associated impact assessments 
were identified and analysed from January 2008 onwards.  
5. ADDRESSING THE KEY PROBLEMS  
In its 2007 report, the Montreal Protoc ol’s Scientific Assessment Panel (SAP) 
warned the Parties that despite the succe sses, continued vigila nce was required to 
keep to the newly projected timetable for r ecovery of the ozone layer, also taking 
account of the remaining uncer tainties, notably about the impact of climate change. 
Key challenges included the need to signifi cantly reduce current levels of exempted 
use by 2015 (including use of methyl br omide for quarantine and pre-shipment 
purposes), to make sure that ODS “banked”  in products and equipment would not be 
released into the atmosphere and to avoi d the marketing of ne w ODS (see section 6.3 
below). At EU level, additional probl ems include regulatory and associated 
administrative complexity, and the need for full compliance with the Montreal Protocol, whilst avoiding the risk of ille gal trade and use of ODS. Following SAP 
recommendations and stakeholders’ sugges tions for improvements, added to the 
Commission’s own analysis, the following general and specific objectives for 
addressing the remaining problems were identified.  
The general long-term objective pursued by th e review remains timely recovery and 
subsequent protection of the ozone layer to avoid the adverse impacts, notably on 
human health and ecosystems. The associ ated short- and medium-term objective, 
however, is to simplify the regulatory framework, whilst at the same time reducing any unnecessary administrative burden, in line with the Commission’s commitment to develop and implemen t better regulation .  
In order to deliver these general objectiv es, the following specific objectives were 
identified, notably to address the problems outlined above whilst building on the acknowledged strengths of the Regulation.  
(1) Achieving better and simpler regula tion by reducing the administrative 
burden: 
(a) clarifying and simplif ying the Regulation; 
(b) streamlining reporting and the asso ciated administrative burden; 
(c) updating the exemption arrangements and the associated administrative 
processes. 
(2) Ensuring continued compliance by means of full implementation of the 
Montreal Protocol as amended in  2007 and stronger enforcement: 
 
EN 6   EN (a) implementing Decision XIX/6 to accel erate the phase-out of HCFCs; 
(b) ensuring EC compliance and preventing illegal and harmful trade.  
(3) Addressing future challenges by tackli ng ODS not yet controlled under the 
Montreal Protocol: 
(a) ODS contained (or “banked”) in products and equipment; 
(b) new and short-lived ODS; 
(c) use of methyl bromide for quara ntine and pre-shipment purposes. 
6. POLICY OPTIONS AND THEIR IMPACT  
A wide range of policy options and associated impact assessments were identified 
and analysed, based on the above-men tioned input and other expert sources 
(e.g. latest analyses and recommendations fr om the Montreal Protocol’s Scientific, 
Technical and Economic Assessment Panels ). Due care was taken to explore the 
widest possible range of simplification opt ions to improve clarity and therefore, 
ultimately, implementation of the Regul ation whilst reducing any unnecessary 
administrative burden. With the latter in mind, the review also considered non-
regulatory measures, e.g. po ssible streamlining of ODS reporting and monitoring 
procedures.  
The options of leaving the Regulation unch anged (business as us ual) or even of 
withdrawing it were duly considered but rejected, inter alia  on the grounds that they 
would put the EC in non-compliance with th e Montreal Protocol and would not allow 
it to pursue its simplification objective. 
The analysis covered the three broad categor ies of policy measures outlined below.  
1. The first important category of policy options which emerged related to the 
simplification objective, building on the pr ogress made on phasing out ODS to date 
and the opportunities to remove expired pr ovisions. Key options that were chosen 
include: 
– removing the provisions and associated pro cedures relating to essential uses of 
CFCs, critical uses of methyl bromide and other exemptions for CFCs and HCFCs;  
– simplifying the cap on use of methyl br omide for quarantine and pre-shipment 
(QPS) purposes whilst lowering the quantita tive limit from 607 ODP tonnes to the 
current level of a maximum of 300 tonnes;  
– streamlining reporting (a recurring reque st from Member States), even though 
there was little room for manoeuvre sin ce most, if not all,  of the reporting 
obligations stem from the Protoc ol rather than the Regulation; 
– ending exemptions which impose significan t administrative costs on a small 
number of players in re turn for small benefits; 
 
EN 7   EN – clarifying definitions and other legal drafting improvements, thereby (together 
with the previous measures) meeting th e demand voiced by many stakeholders for 
a simpler, more structured legal act. 
This package of simplificati on options is expected to yield cumulative savings in 
administrative costs estimated at nearly €4 million over the period up to 2020. The associated environmental impact is assumed to be positive (albeit small and difficult to quantify), as the revised Regulation is expected to be easier to implement and 
enforce, including by SMEs. For the same reason, small net direct economic gains 
for industry and users of ODS could be exp ected, notably for SMEs which have less 
access to specialist knowledge fo r implementing the Regulation.  
2. A second category of options emerged in line with the need to ensure 
continued compliance with the Montreal Protocol. Preferred options included:  
– bringing the phase-out date  for production of HCFCs forward from 2025 to 2020 
to align the Regulation with the recent Decision XIX/6 to accelerate the phase-out 
of HCFCs;  
– simplifying and tightening up enforcement of the Regulation to prevent illegal 
trade and use of ODS in the EU, with the aid of more effective provisions on 
Member States’ inspection requirements (i.e. moving from “random” to “risk-
based” inspection), measured labelling re quirements to avoid illegal trade (also 
within the EU) and selected measures to step up monitoring of imports and 
exports of ODS. 
These policy options will avoid excessive ad ministrative costs and ensure continued 
compliance with the Montreal Protocol, no tably by preventing ille gal trade, thereby 
also meeting the concerns raised by industry during the survey.  
3. To ensure that the remaining challenges can be adequately addressed in future, 
the focus was on the three following areas: 
(a) Release of “banked” ODS/GHG emissions into the atmosphere
 – Because the 
Protocol has been focusing on gradually  banning consumption and production 
of ODS, significant amounts of ODS remain  stored or “ba nked” in products 
and equipment (e.g. in insulation foams,  refrigerants and air-conditioning 
systems). Considering the high global  warming potential (GWP) of these 
banked ODS, failure to recover and ul timately destroy them also poses 
significant risks of global warming. In 2010, ODS banks in the EU could add up to approximately 700 000 ODP tonnes (5 billion tonnes of CO
2eq), although 
experts acknowledge a large degree of uncertainty due to the limited measurement data available. Emi ssions could potentially total around 
24 000 ODP tonnes (or 170 million tonnes of CO
2eq) per annum over the period 
2005-15.5 A number of measures to tighten  up the provisions on recovery and 
destruction of ODS contained in pr oducts and equipment are proposed for 
inclusion in the Regulation. They could yield environmental benefits of up to 
                                                 
5 Estimates were derived by extrapolating the best available global estimates contained in a 2005 TEAP 
report, according to which global banks totalled 3.5 million ODP tonnes (20 billion tonnes of CO 2eq) in 
2002 with projections pointing to 2 million ODP tonnes for 2015 (13.4 billion tonnes of CO 2eq).  
 
EN 8   EN 14 000 ODP tonnes, or 112 million tonnes of CO 2eq, over 10 years. In addition, 
implementation of the EU Waste Framew ork Directive and of the Waste from 
Electric and Electronic Equipment (“W EEE”) Directive is being improved to 
capture ODS/GHG emissions, potentially yiel ding additional benefits of up to 
34 000 ODP tonnes (270 million tonnes of CO 2eq). Furthermore, considering 
the large variability in costs for the various products (ranging from €4.5 for 
simple destruction to €100 per kg of ODP  for recovery and destruction of ODS 
contained in insulation foams), follow-up action will focus on smart and measured incentives to in crease (significantly) th e volume of products and 
equipment presented for recovery  and recycling or destruction.
6  
(b) Marketing new ODS  – The 2007 report by the Scientific Assessment Panel set 
up under the Protocol revealed  new scientific evidence that the ODP of certain 
chemical substances not currently cont rolled by the Protocol (e.g. nPB) is 
substantially higher and recommended th at Parties consider certain control 
measures to avoid reversing the pr ogress made to date. Currently, EC 
emissions of new ODS are estimated to total less than 300 ODP tonnes per year. To avoid expanding markets that  would have to be tackled later, 
precautionary measures are proposed in the form of listing new ODS in an 
Annex to the Regulation (e.g. based on companies’ disclosures under REACH) 
and requiring producers and importers of such ODS to report the volumes traded. Although effective for raising awareness amongst consumers of ODS, 
these measures are not expected to give rise to any significant economic impact 
on industry, which is expected to c ontinue to move away from ODS. 
(c) Reducing use of methyl bromide for QPS activities
 – Considering that methyl 
bromide is a toxic substance that causes  significant health hazards (which is 
why the Regulation is already more stringe nt than the Protocol), the preferred 
option is to make recapture mandato ry up to 2015 and to phase out the 
substance thereafter. This measure will allow a transition phase, where alternatives such as heat treatment ar e likely to be more competitive in many 
situations, followed by phasing-out when mo re alternatives are available. The 
total cost to industry would be €9.5 million over the period 2010-2020, saving methyl bromide equivale nt to 2000 ODP tonnes. 
7. C
ONCLUSIONS  
The policy options proposed reflect a deep  commitment to simpler and better 
regulation based on sound analysis. The resu ltant package will lead to a significantly 
simplified regulatory text whilst simultaneously offering guarantees for locking in and consolidating the progress made to date on the ODS phase-out. Although the 
successful phase-out has already reduced th e administrative burden associated with 
implementation of the Regulation, additional net savings for the total package (after 
also taking account of the fe w measures that may lead to  increases in administrative 
costs) will total nearly €3 million, w ith about €2 million accruing to industry, 
€0.7 million to Member State authorities and the remainder to the European 
Commission. The package will not lead to si gnificant net direct incremental costs. 
                                                
 
6 E.g. standards linked to offset or deposit systems, funding destruction from regional funds, etc. 
 
EN 9   EN The cumulative additional direct economic impact is expected to stay below €13 
million, mainly related to measures to reduce methyl bromide use for QPS purposes7. 
Simplification is expected to be particularly beneficial to SMEs which have less access to specialist knowledge fo r implementing the Regulation. 
The most tangible environmental benefits from the package are related to reduced 
consumption and increased recovery mostly stemming from policy action on banks and QPS activities. These could add up to a net gain of 16 000 ODP tonnes, or 112 million tonnes of CO
2eq.8
 Further translation in terms of reduced cancer risk would 
not be meaningful considering the small quantities involved comp ared to the global 
scale of the problem, and the large uncer tainties around the dos e-response function 
linking a unit ODP tonne to the final human and environmental health impacts. This 
net reduction in ODP emissions would howev er contribute to reducing the risk of 
further depletion of the ozone layer, wh ilst also bringing real climate change 
benefits. Details, including a full list of a ll the options considered and their impact 
(including rejected options), are availa ble in the full impact assessment.  
Action will be stepped up to finally phase out use of ODS where alternatives are 
expected to be availabl e soon. Such action is out lined in the Communication 
accompanying the proposal to recast the Regulation. In parallel, as a follow-up to this 
review, the Commission will work closely w ith Member States to tackle the key 
remaining issue of banked ODS. Such action may yield si gnificant additional 
environmental benefits. Likewise, the Comm ission will work closely with Member 
States and other Parties to the Protocol to reduce remaining uses of ODS, notably 
those related to QPS activities, and to  avoid the marketing of new ODS.  
                                                 
7 Costs would be significantly lower if taking into account the likely decision to deregister Methyl 
Bromide on health grounds.  
8 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.