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Circular Economy

The Recycling-based Society and the Legal System in Japan

At the request of NDRC, a Japanese document, "Recycling-Based Society Law,"  was translated into Chinese as one of a number of models for the formulation of a future (in three years or so) law for implementing the circular economy. The document has more than 100,000 words, and took six months to translate under the supervision of Mr. Wang Hangchen. The following is a brief summary.

1. Introduction

These laws and legal systems were formulated and passed during the period 1990 to 2003. There are 15 main parts, which are:

  1. Basic laws for promoting the recycling society: Three chapters and 32 articles;

  2. Contents of the laws: 6 chapters (2000);

  3. The Law for Promotion of Efficient Utilization of Resources: Formulated from July 1999 to April 2001.

  4. The fundamental directions for the Promotion Law: Objectives for waste minimization, production, consumers and society (2000);

  5. The recycling of packaging materials, e.g. PET bottles, paper products (2000).

  6. The law on classification of packaging materials and reuse for commercial products. It contains 8 chapters and 49 articles covering incentives, rewards, penalties and reporting procedures (1999)

  7. The recycling of home appliances (1998);

  8. Waste collection, transportation and reuse of home appliances (2001);

  9. Legislation on the re-utilization of construction materials (2000);

  10. The basic guidelines for promoting waste classification of specific construction materials including concrete, wood and other recoverable materials (2000);

  11. The Law for the Promotion of the Recycling of Food Stuffs (2000);

  12. The basic direction for re-utilization and Recycling of Food Stuffs (2001);

  13. On the Resources and re-utilization of End of Life Automobiles (2002);

  14. The Major Contents on the Mechanism for Green Procurement (2000);

  15. The Law for the Promotion of National Procurement of Environmentally Friendly Products (2001).

For the purpose of the laws, “Recycling-based Society” means a society where the consumption of natural resources will be restrained or limited and the environmental load reduced to the maximum extent. Products are not to become waste and appropriate recycling processes are promoted. To achieve the establishment of the recycling-based system is a long-range target of the environmental policy of Japan (and China), and its aim is not to damage the closed system of the earth. Consequently, it is necessary to integrate the Circular Economy closed loop into the socio-economic system.

China, as well as Japan, considers that “The basic law for the establishment of the Recycling-based Society” is an important policy which will realize its objectives by reducing the environmental load generated from human activities to the minimum, and will comprehensively and systematically promote a policy for integrating the CE closed loop into socio-economic systems.

Great attention will likely be paid to measures to curb and decrease the global warming trend. Unless the present level of the use of resources and energy through all steps of socio-economic activity - including extraction, production, refining, circulation, consumption, and disposal - is changed, it is certain that turning the law into the highest level of environmental efficiency will be very difficult, if not impossible, to achieve. We should nevertheless treat the problems of “Establishing the Recycling-based Society” as an administrative framework for waste disposal and for promoting the process of recycling.

In the Basic Law, waste is defined in a much broader sense (see the 15 issues cited above) i.e. “recyclable resources.” This new concept is of vital importance in the effort to establish the Recycling-based Society. It is necessary to define a new legal system in accordance with this concept. In Japan, a large number of laws and regulations were formulated in 2000, and new developments and frontiers are moving forward.

2. Definition of CE:

There are a number of ways to define the term Circular Economy (CE). The accepted working definition may be interlinked manufacturing and service businesses seeking the enhancement of the economy and environmental performance through collaboration in managing environmental and resource issues. The theme of the CE concept is the exchange of materials where one facility’s waste, including energy, water, materials - as well as information - is another facility’s input. By working together, the community of businesses seeks a collective benefit that is larger than the sum of the individual benefit that each enterprise, industry and community would realize if it intended to optimize its performance on an individual basis (i.e. industrial symbiosis).

3. CE in China:

The 16th National Congress of the Communist Party of China, held in November 2002, pledged an ambitious blueprint for China’s development in the next twenty years, i.e. to realize an overall well-off (shao kong) society by the year 2020. This social system is defined as quadrupling the country’s GDP, while enhancing social equality and environmental protection as well. The pursuit of a new industrialization model becomes China’s only pathway in  reconciling and linking these dual endeavors to sustain high-speed economic growth and to reverse environmental degradation. The characteristics of such industrialization will be focused on featuring high-technology products, good economic returns, low natural resource consumption and environmental pollution, and efficient deployment of manpower.

Development based on the circular economy becomes essential for China to reach an overall well-off society by sustaining fast-paced economic growth while mitigating negative ecological impact and creating more job opportunities.

In less than three years, the concept of ecological industrial parks (EIP) and CE was introduced into China and started to flourish. While more and more government officials and enterprise estate managers talk frequently on the subject, what is unfortunately lacking is the theoretical framework, the practical tools and the experts who can disseminate the pertinent information so it can be effectively applied.

Another misconception which often persists is that with CE, the practice of Cleaner Production (CP) may be put in the back seat. In fact, CP is the first and most vital step for reaching the ultimate goal of CE, especially for industrial sectors. Without the implementation of CP, CE remains a conceptual framework. For CE to prosper in China, it must not become merely the property of the environmental community. Its acceptance and application by economic policymakers, urban planners, and industrial managers will be a decisive factor for capacity strengthening.

3. Summary of measures taken by Japanese government for the creation of a Recycling-Oriented Society

As with the relevant laws cited above, it would be too long to translate the whole text. A brief summary is given below for information regarding their essentials.

(1) The Law for Promotion of Effective Utilization of Resources (the revised Recycling Law):

This law was enacted in May 2000 and came into force in April 2001. This new law was designed to help the creation of a recycling oriented society, and was epoch-making and unprecedented in the world for two factors. First, it required all three 3 R actions - Recycle, Reduce and Reuse; and second, it covered the entire product life span, from the upstream phase where companies are required to reduce their industrial wastes and design environmentally-friendly products, to the downstream phase where companies have the obligation to recover reusable parts or materials from waste products for recycling.

A cabinet order was issued to designate 69 product categories in 10 industries (covering about 50% of municipal and industrial wastes) effective from April 2001, and a ministerial order was issued to establish detailed guidelines for 3 R activities.

The law promotes not only recycling but waste reduction. Remarkable examples have been witnessed. For instance, the city of Nagoya was the first of large cities to fully implement the law in 2000, and saw its total annual waste and waste buried in landfills decrease by 20% and 30% respectively from the previous year.

(2) Effects of the Containers and Packaging Law:

According to sources from the Ministry of the Environment and the Japan Container and Packaging Recycling Association, the annual amounts recycled for:

Transparent glass bottles--- about 1400 tons; brown bottles---1,800 tons; any other color---1,200 tons; PET bottles--- 700 tons; plastic containers and packages---600 tons, and paper containers and packages---160 tons.

(3) Home appliances:

The Law was came fully into force in April 2001. It obliges home appliance manufacturers to recycle TVs, refrigerators; air conditioners; and laundry machines, and to make effort to target the rate from 50% to 60%. The enforcement of the law prompted manufacturers to form two large groups, one including Matsushita and Toshiba, and the other including Hitachi, Sanyo, Sharp, Mitsubishi and Sony. Each group has established its own recycling plants, waste-collection centers, and other necessary facilities, and set recycling charges.

Thanks to such preparatory efforts, the law has caused no significant difficulties since it came into force. Manufacturers are particularly happy to see their 37 recycling plants located in various areas in the country handling more home appliances than anticipated. The cumulative number for the period of April 1 through October 31, 2001 was 5.2 million collected at designated places nationwide and 5 million at recycling plants across the nation.

Another piece of good news is that the number of illegally-dumped appliances did not increased as expected. Currently, this number accounts for as little as 1% or less of the total of waste appliances. The law is being monitored to analyze its effectiveness.

(4) Automobile Recycling Law:

The draft of this law was under study from July 2000 by the Industrial Structure Council and submitted to the Diet in 2001, and became law in 2002.

Briefly, the major contents of the Law are:

(a) Each person who buys a new vehicle must pay a recycling charge at the time of purchase. The money collected is kept by a fund management organization until the vehicle comes to the end of its life to be disposed;

(b) In the case of collection/recycling systems, each dealer or repairer will act as an “ELV ( end of life vehicles) collector” to whom final users turn in their ELV vehicles and the dismantler and shredder shall act as a “recycler.” Any company which desires to become a collector or recycler must be duly registered with an authority prior to commencing its operation; and

(c) Automobile manufacturers and importers are responsible for recovering and recycling CFCs, airbags, and shredder dust, which are the main costs for users turning in the ELV.

The estimated number of disposed vehicles will be available sometimes 2004.

(5) Guidelines for Waste Treatment/Recycling by Commodity and Business:

The guidelines were established by the Industrial Structure Council’s study group in 1990. They indicate how companies are to recover recyclable materials and handle residues, and outline advice on the establishment of their recycling targets and waste collection systems. The guidelines are revised annually and reinforced based on the progress made by companies for that year in terms of recycling.

The latest revision was made in July 2002, and raised the total number of designated product categories to 35 and industries to 18. They are:

Products: paper; plastics; bicycles; carpet; lead storage batteries; fire extinguishers; gas/oil equipment; construction materials; fluorescent lamps and other lamps; glass bottles; automobiles; home appliances; bedding; gas cartridges; pachinko (Japanese pinball) machines; textile goods; bathtubs and bathroom units; vending machines; steel cans; motorbikes; spring mattresses; dry batteries; aerosol cans; PCs and peripheral equipment; lubricants; kitchen components; disposable cameras; aluminum cans; tires; large furniture; Ni-Cad secondary batteries; small gas cylinders; copiers; electrical cables and cellular phones.

Business: steel; textile; auto accessories; leasing; gas housing; paper and pulp; non-ferrous metal; electronic equipment; cement; pre-fabricated houses; chemicals; electricity; oil refinery; rubber products; sheet glass; automobiles; retail; and coal mining.

(6) Promotion of Eco-Town Businesses:

These are projects to establish high-tech model recycling facilities in local communities to reduce the amount of waste. The projects have been promoted through subsides from the Ministry of Economy, Trade and Industry (METI) given to private enterprises for the establishment of such facilities. This subsidy system was introduced in 1997, and the Ministry hopes to use it to assist the private sector to take the initiative in building up the recycling industry. METI, together with the Ministry of the Environment, has approved eco-town businesses in 14 municipalities across the country, and granted subsides to 24 facilities. To maximize the effectiveness of this system, it is important for METI to carefully select innovative projects for the promotion and development of the recycling industry in the private sector.

(7) Promotion of Technological Development:

Although the “3 R Program” was announced by METI in 2001 as a strategy for the recycling technology, the program will have to accelerate innovation, which is indispensable for the creation of a recycling-based economy system and for the commercialization of recycling technology. In accordance with this program, priorities have been given for the following fields for strategic technological development:

  1. Methodology and measures to promote the recycling of automobiles;

  2. Methodology and measures to promote home appliance recycling;

  3. Methodology and measures to promote container and package recycling;

  4. Resources for containing hazardous compounds; and

  5. Resources for the commercialization of recycling technology.

(8) Food Industry:

The food industry is suitable for demonstrating the concept of a zero-emission system, although the current emissions in processing raw materials into finished products is relatively high compared to other industries.

The average amount of emission from one plant surveyed by the Food Industry Center in 1992 for establishing the relevant law in Japan was about 11 kt/year, most of which was sludge and vegetable residues. It is also characteristic of this industrial sector that there are few unit operations within each process, and consequently, the approach to the zero emission process can be developed specifically for such case. As the majority of present discharges and emissions are in the liquid or solid form, nontoxic and perishable, they can be used or reused for feed to livestock, to make fertilizer after composting, or as a source of heat by burning. This kind of reuse methodology will face difficulties since future increases of the waste amount cannot be predicted, and changes to the conventional production processes are necessary to introduce the new innovative zero-emission methodology, which can convert the waste into resources.

In this Law the basic directive orders are formulated. It contains: Guidelines and recommendations; warnings to more than 16,000 enterprises whose annual emissions are over 100 tons with insufficient efforts to reduce; registrations; and classifications. The Law offers details on the basic concept; priorities; enterprise/government responsibilities; waste reduction; reuse and indicators; methodology development; facility/process improvement; agreement for fertilizer and feed stock quality assurance and cooperation; life cycle assessment; and information on the food industry.

(9) Law for Construction Materials:

In view of the serious problems encountered from construction waste, the Law is formulated to promote re-utilization within the industry. Based on the conditions at construction sites, the industry must maximize the processes of waste classification and dismantling. For those products which cannot be processed on site, shipment to a designated area for further screening, classification and recycling or reuse is required.

To expedite the process of waste treatment, it is necessary to develop the relevant methodology and close cooperation among pertinent partners and stakeholders.

Since 95% of construction wastes are concrete, scrap lumber, and discarded soil, efforts are concentrated on the reuse of these materials. According to the Green Procurement Law, projects under the direct management of the government should give priority to purchasing materials produced by the construction recycling process.

Through study and investigation, EIA (environmental impact assessment) and life cycle assessment should be applied to evaluate the different stages for materials being used for construction. These stages include: material development; manufacture; transportation/distribution; building design and construction process for using special materials; material re-utilization and methodology for eventual disposal.

4. Conclusions:

The Japanese government has taken a first, but great, step, leaping forward to the creation of a recycling-based society based on the concept of the circular economy, backed by the formulation and passage of recycling-oriented laws, and the growing awareness of the public for sustainable development. Consequently, for further steps in that direction, the Japanese government through METI is determined to take appropriate measures to implement its policies through both private and public communication channels with concerned citizens and stakeholders. In addition, direct support will be given for the establishment of recycling facilities in relation to eco-town businesses and technological development, as well as to more sophisticated and comprehensive recycling systems.

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