Trilateral Working Group Meeting Latin America Battery Association October 20th, 2016 Rosslyn, VA T. García / H. Alvarenga

Agenda Countries of Interest Mexico Chile Ecuador Argentina

Mexico All kind of batteries are consider special Handling waste. Only big generator (more than 10 Ton per year) are obligated to establish handling plans. Generator is who use the battery and has to dispose it. Producer and distributor are not consider generators. Lead-Acid, Ni-Cd, Mercury oxide and Silver oxide batteries are consider Hazardous waste. Mexican Regulation to control battery importation because of Hg and Cd content (according to Battery Directive) To be published for public consultation Hg Inventory (MINAMATA Convention) is been developed Mexico can use the 2nd version of the Hg toolkit inventory Mexico city has a huge waste problem (About 13,000 tons per day) No areas for landfill disposal Searching for incineration solutions and they will look that all companies pay for that. We expect to be in the list of the industries.

Chile - General Information Regulation Name Ley de fomento del Reciclaje y la Responsabilidad Extendida del Productor “Recycling Promotion and EPR Law” Congress Approval April 5th, 2016 Presidential Approval April 12th, 2016 Publication May 17th, 2016 Enforcement By Supreme Decrees to be issued for each Priority Products Regulation for the creation of Supreme Decrees One year for drafting the Regulation for the creation of each Supreme Decree publication after Law publication in Official Gazette Supreme Decrees Enforcement TBD – Estimated mid of 2018

Chile - Impact on business Regulation Type of law Framework law establishing general requirements for target product categories (priority products) Scope Initial set of general product categories (Priority Products) Lubricant oil Electric and Electronic Equipment Automotive Batteries Packaging (in general) Tires Primary and Secondary batteries (HS 8506/8507) Scope extended Supreme Decrees might expand into subcategories each priority product main category. Subject regulated Importers, local manufacturers, distributors and end consumers (different degrees of responsibility for each one)

Chile - Impact on Business Regulation Collection target Not defined by the law, TBD for each Priority Product by each Supreme Decree. Estimated for batteries, initial 4% (average of sales) Collection target estimated 4% (baseline) 10/15% (323tn) by 2019 25/30% (774tn) by 2023 Labeling Authority might require the use a particular label to promote recycling – TBD Hazardous Substances Authority might require product certification to assure heavy metals content maximum concentration - TBD

Ecuador – General Information Current Obligations – Battery Certification Primary Batteries RTE-105 as of June 2014 Scope: IN: CZ/ALK ; OUT: Button Cells Applicable Standard: IEC60086 parts 1 and 2 Heavy Metals: Hg 5ppm, Cd, 20ppm Secondary Batteries RTE-115 as of June 2014 Scope: IN: Lead Acid, Li-ion, NiCd, NiMH; OUT: Products with batteries Conformity Assessment Self Declaration of Conformity + Third Party Testing Lab Foreign Test Houses Must be members of ILAC Local testing capability None Approval Certificate validity 2 years Checking point Customs Every importation lot Collection target estimation is based on AMPHOS XXI LCA study for batteries in Chile that was prepared for the Ministry of Environment. Certainly it is going to be used as the starting point of discussion at the time of drafting the Batteries Supreme Decree.

Ecuador – General Information Current Obligations – Battery Stewardship Program Legal requirement Ministerial Agreement 022 as of April 2013 Scope Primary batteries: Oxide Mercury Secondary batteries: NiCd, NiMH, NiFe, Li-ion Conformity Assessment Implementation of a national individual or collective Battery Stewardship Program Collection Target 5% First year + 5% annual increments until getting to 85% collection rate. Local battery processing capability None Final disposal Not allowed Exportation Allowed Degree of Battery Industry Compliance Very low Checking point Market Collection target estimation is based on AMPHOS XXI LCA study for batteries in Chile that was prepared for the Ministry of Environment. Certainly it is going to be used as the starting point of discussion at the time of drafting the Batteries Supreme Decree.

Ecuador – General Information Current Obligations – Battery Certification & Stewardship Program Regulation RTE-105 (1R) Enforcement December 28th, 2016 Scope Primary and Secondary Batteries Scope Exeptions Car batteries Batteries included in products Heavy Metals Limits Hg <= 5ppm Cd <= 20ppm Safety Requirements – Primary IEC 60086 parts 1,2,3,4 and 5 depending on the battery type, or ANSI C18.1 part 1 and ANSI C18.1 part 2, or NTE INEN 807 (parts 1,2,3,4 and 5 depending on the batter type) Safety Requirements – Secondary NiCd (cylindrical, prismatic and button) IEC61951-1 and IEC62133 Sealed NiCd (prismatic) IEC60622 and EN50272-1 Non-sealed NiCd (prismatic) IEC60623, EN50272-1 and EN50272-2 NiMH (cylindrical, prismatic and button) IEC61951-2 and IEC62133 Lithium (portable applications) IEC61960 and IEC62133 Lithium (industrial applications) IEC62620 VRLA IEC61056-2, EN50272-1 and EN50272-4

Ecuador- INEN RTE-105 (1R) – Conformity Assessment Procedure Certification Schemes Third Party Certification Scheme 5, NTE INEN-ISO/IEC 17067 Surveillance evidence Marking approval evidence Importer’s registration (local) Hazardous Waste Generator registration (Ministerial Agreement 022) First Party Certification (SDoC) Manufacturer’s SDoC, NTE INEN-ISO/IEC17050-1 Hazardous waste Generator registration (Ministerial Agreement 022) Local testing capability None Foreign testing labs Must be members of ILAC Checking Point Customs

Argentina – General Information Current Obligations – Battery Certification Primary batteries Law 26184 as of December 2006 Scope All primary batteries except Lithium Includes batteries coming with products Local testing capability INTI (National Institute of Industrial Technology) Applicable Standard IEC60086 Heavy Metals Hg < 5ppm, Cd <15ppm, Pb < 200ppm Checking point Customs

Argentina – General Information Current Obligations – Battery Stewardship Program National Level Do not exist Provincial Level Only Buenos Aires City Resolution 262 as of October 2008 Collection target None Capilarity 10 collection points Stewardship Program Individual or collective Conformity Assessment Medium

Argentina – General Information Future Obligations – Battery Stewardship Program Legal framework Presidential Decree Publication December 2016, estimated Nature of the progam 50% Public / 50% Private Public Primary collection and temporary storage 40,000 collection points 150 temporary storage facilities Private Reverse logistics for treatment/disposal Scope Primary and Secondary batteries (including button cells). Out of Scope: secondary batteries from cellular phones, IT and telecommunciations devices. Program estimated efficiency 0.5% = 18tn/year Treatment Final disposal (3 provincies) Open loop recycling (Steel and/or Cement Industry) Exportation (Europe mostly – SNAM)

Argentina – General Information Future Obligations – Battery Stewardship Program Require for Battery Industry To grouped behind a collective organization To finance 50% of the stewardship program by taking care of reverse logistics and treatment/final disposal Extended requirement Off the record Ministry of Environment wants Battery Industry to own the whole Stewardship Program Obstacles – Law perspective There is not any national stewarship law Batteries are considered hazardous waste Big provinces ban domestic importation of hazardous waste Hazardous waste logistics cost +4 times more than regular logistics Collection bins and TSF must comply with HW law Obstacles – Political perspective Provinces must adhere to this new program and municipalities must implement it. +40% of the country is run by the opposition political party. Program estimated efficiency 0.5% = 18tn/year Treatment Final disposal (3 provincies) Open loop recycling (Steel and/or Cement Industry) Exportation (Europe mostly – SNAM) Costs UNKNOWN

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Backup Slides

Chile - Impact on Business Regulation Take back & Recycling Programs Can be implemented gradually, but must assure national coverage. Gradualism will be allowed based on: General Social and Economic Impact Assessment Consensus among public, private and civil associations Public consultation with a minimum duration of 30 days Regulated subjects must Be registered in the National Register of Pollutant Emissions and Transfer Organize and be financially responsible for the nationwide take-back of priority products by means of individual or collective waste management organizations Subscribe an insurance to assure correct operation of the waste management system (TB&R) Recycling fee Priority Products to be collected and treated must be accepted for free by the corresponding TB&R system. In other words, end consumers can not be charged for the recycling of the product.

Chile - Impact on Business IMPORTANT Reporting obligation Even though Supreme Decrees for each Priority Product would not be ready; Authorities might required annual performance reports on: Quantity of products sold Voluntary TB&R activities and costs Quantity of collected, treated and disposed products Whether the TB&R system is individual or collective Penalties Serious Violations Not achieving collection quotas Not counting with mandatory insurance Not implementing and adequate TB&R system

Ecuador – RTE-105 (1R) – Scope Extended Tariff Code Description 85.06 Primary batteries 8506.10.11/8506.10.12/8506.10.19 Alkaline cylindrical and button cell and others 8506.10.91/8506.10.91.10/8506.10.91.90 Zinc Chloride / Ammonium Chloride 8506.10.92 Button cell 8506.10.99 Other 8506.30/8506.30.10/8506.30.20 Mercury Oxide 8506.40/8506.40.10/8506.40.20/8506.40.90 Silver Oxide 8506.50/8506.50.10/8506.50.20/8506.50.90 Lithium 8506.60/8506.60.10/8506.60.20/8506.60.90 Zinc Air 8507.20.00 VRLA 8507.30.00 NiCd 8507.40.00 NiFe 8507.50.00 NiMH 8507.60.00 Li-ion 8507.80.00 Others

Ecuador - INEN RTE-105 (1R) – Marking Requirements Battery Type Marking Requirements Primary IEC 60086 parts 1,2,3,4 and 5 depending on the battery type, or ANSI C18.1 part 1 and Part 2, or NTE INEN 807 parts 1,2,3,4, and 5 depending on the battery type or ANSI C18.3M part 2 and Part 2 Secondary NiCd (cylindrical, prismatic and button) IEC61951-1 and IEC62133 Sealed NiCd (prismatic) IEC60622 and EN50272-1 Non-sealed NiCd (prismatic) IEC60623, EN50272-1 and EN50272-2 NiMH (cylindrical, prismatic and button) IEC61951-2 and IEC62133 Lithium (portable applications) IEC61960 and IEC62133 Lithium (industrial applications) IEC62620 VRLA IEC61056-2, EN50272-1 and EN50272-4 Language Spanish Use of sticker or label Allowed Label contents Importer’s record (Tax ID, Address) Battery type, battery model, caution messages and user instructions

Ecuador - INEN RTE-105 (1R) – Testing Methods Mercury US EPA 7471B or equivalent Cadmium ASTM E536-04a

Argentina - Battery Collection Plan 2016 - 2018 Introduction of the Industry Integrated Management System for approval Industry IMS approval by MMA and the provinces Implementation of Industry’s IMS 2016 2017 2018 Enero Marzo Mayo Julio Septiembre Noviembre Febrero Abril Junio Agosto Octubre Diciembre Provinces adhere to the national decree Partial implementation of Industry’s IMS Collection Program Development NBP starts (public part, primary collection up to each TSF) Manufacturing and importation restrictions based on membership to the BIT Government to take care of promotion, eduacation, collection bin delivery, initial primary collection and storage at each TSF Presidential Decree Resolution MAyDS Implementation of Importer’s Registry