Samsung Electronics Activity to cope with RoHS

1 Contents ⅠⅡ Global Regulations and EU RoHS Ⅲ Activity to cope with RoHS Plan from now on Ⅳ Proposal of mutual cooperation

2 Ⅰ. Global Regulations and EU RoHS EU RoHS US Proposition65 US VT & CT Hg Labelling China-RoHS Korea-RoHS Japan-RoHS AU Br-flame retardant Reinforce the restriction of hazardous material in products in EU and most countries * VT : Vermont / CT : Connecticut

3 Ⅰ. Global Regulations and EU RoHS  Purpose - Integrate the regulation related to restriction of hazardous material in products - Preserve mankind health and environment-friendly reusing the waste of electronics and electric device and promotion of recycle.  Main issue - Restrict the use of hazardous substances, which will become effective from July, 2006 ※ Banned substances : Cd, Pb, Hg, Cr +6, PBB, PBDE  Threshold : Restrict the intentional use of banned substances SubstanceCdPbHgCr+6PBBPBDE Threshold ( ppm ) 1001,000 RoHS ? * RoHS : Restriction of the use of certain Hazardous Substance

4  Target product of RoHS ProductExample Household appliances IT & Telecommunication equipment Consumer equipment Lighting equipment Electrical and electronic tools Toys, leisure, and sports equipment Vending machine Ⅰ. Global Regulations and EU RoHS

5 Cr 6+ Chrome plating, Toner Pb PCB board, Rubber, Plastic Cd Rubber, Plastic Hg Lamp, Electric contact, Plastic Br Plastic, flame retardant Use of RoHS substances

6 Ⅱ. Activity to cope with RoHS Eco-Partner Program Overview of Eco-Partner program - Eco-Partner target : 3,298 vendors which supply 179, 400 Items : All suppliers including OEM companies, which provide parts and raw materials “ EMS “ Organization and management system “ Management Standard “ Parts or material that cope with that standard +  3,298 suppliers don’t use the restricted substances by certificating the Eco-Partner SectionSuppliersOccupancy RateRemark Total3,298100% Korea % Overseas2,355 71% RegionQty.RegionQty. Korea943West Asia107 China964America242 Japan215EU120 East Asia707Total3,298

7 Ⅱ. Activities to cope with RoHS Eco-Partner Program  Apply RoHS-Free parts to all products export to EU and all Countries from Aug, Use the EU RoHS compliant parts  Management Process - Intensively managing Item : 111,625 Items of 5 risky item groups  Occupancy Rate is 66% out of all SEC parts, Items  5 risky item groups : Injection molding, rubber, printing/packaging, plating/painting, Wire Harness  Incoming inspection ( Differentiate the inspection period for each level of risky item ) and periodical Monitoring - Cancel Eco-Partner and P/O Block for failed item suppliers Restrict the hazardous substances by Eco-Partner program → Classifying by part type → Intensive Management for Worst Item → Guide the supplier’s manufacturing process → Radical prevention of hazardous substances

8 Analysis Lab. Establishment  Summary - CS Management Center : 554m 2 of Area ( Investment for RoHS Compliance : 5million$ )  Heavy Metal Analysis : ICP-AES, IC, UV-VIS etc.  Organic Analysis : LR-GC/MS, HR-GC/MS etc. - GBMs / Oversea Factories : Deploy of XRFs for Screening - Equipments for VOCs ( Volatile Organic Compounds ) ( 0.9million$ ) Heavy metal Lab. Organic Lab. Ⅱ. Activities to cope with RoHS

9 Analysis Lab. Establishment  Improvement of Analysis Productivity with Reliable Data * Chemical Analysis : Ignoring Productivity ( Past ) → Speed is Important ( Now ) - Analysis Time Reduction  Reducing Pretreatment Time : 122 → 104hr for RoHS Six Sub.( 15% Reduction )  Saving 0.3million$ in Annual Testing Cost - Application of Spot-test for Cr 6+ Analysis ( Qualitative Analysis )  Judgment Using Coloring Reagent ( Replacing Ion Chromatography )  Reducing Testing Time : 18 → 1.7hr ( 90.2% Reduction ) Pass Fail Ⅱ. Activities to cope with RoHS

10 Ⅲ. Plan from now on  Completely cope with RoHS directive by post management through Win-Win strategy with suppliers and manufacture the Environment-friendly product  Lead the suppliers through adopt new material.

11 Ⅳ. Proposal of mutual cooperation Construct joint management system to cope with environmental regulation Standardize the Supplier Management Method Establish the mutual Certification system Share new material Information and technology Preserveenvironment Reinforcecompetitiveness Guarantee 100% Zero Defect parts through international cooperation

12 Thank you Environment-friendly management is the key for sustainable operation of business