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Business

Apple, Samsung in a Jam with Imports Held up at Customs

April 12, 2019 06:54 AM

COURTESY ET APRIL 12

Apple, Samsung in a Jam with Imports Held up at Customs
8 other tech cos also hit; April-June sales could be affected if issue is not resolved soon
Anandita.Mankotia@timesgroup.com

New Delhi:

Premium smartphones and electronic merchandise worth about ₹5,000 crore of 10 tech companies including Apple, Samsung, Vivo, HP and Motorola are stranded with customs after the Central Pollution Control Board (CPCB) suspended their import permits for not complying with e-waste rules.


The government suspended the import permits of the 10 companies for violating Extended Producer Responsibility (EPR) clauses — which are part of rules around management of e-waste — through a notification effective April

4. Since then, the companies have been holding a series of meetings with officials in the environment ministry to resolve the issue, without much luck so far. Experts say if the stalemate continues, it could well hurt their sales for the April-June quarter.

“These companies have made representations to us and they have accepted that compliance is an issue,” CK Mishra, secretary, ministry of environment, forests and climate change, told ET.

“Meanwhile, we are trying to see whether they have moved towards compliance, so the ministry has asked CPCB to look at their commitments and see how this issue can be resolved,” he said.

The companies claim that the CPCB’s decision to revoke their import permits is disproportionate to the rule violations, especially since they have exceeded their targets for collection of e-wastes and have faulted only on minor compliance issues such as not seeking prior approval from authorities concerned before shutting down a centre and opening another, and not raising awareness at their centres, including putting up of posters.

“We feel this is a huge overreach of e-waste management rules. Even though e-waste management rules do not gel with India’s trade environment, the legitimate industry has tried to comply,” Pankaj Mohindroo, chairman of the Indian Cellular and Electronic Association (ICEA), said.

The ICEA has written to the secretary, requesting for a relook into the suspension of import permits. Apple, Vivo and Motorola are members of the ICEA.

“The total value of merchandise lying stranded with customs within a week of this order would amount to about ₹5,000 crore, finished products as well as raw materials together,” Mohindroo said. “If this stalemate continues and the government doesn’t revoke this order soon enough, the quarterly shipments of these companies will take a significant hit,” he added.

Emails sent to Apple, Samsung, Vivo, HP and Motorola didn’t elicit any response till press-time Thursday.

Officials in the environment ministry told ET that violations weren’t as minor as these companies were making them out to be.

In one particular case on noncompliance, when officials from the Kerala State Pollution Control Board visited a collection centre of one of the tech companies in January, they found that the operators at certain centres were not even aware that the locations had been designated as authorised collection point in the Extended Producer Responsibility (EPR) plan, and thus, had not collected or transferred any e-waste to authorised recyclers, as per the EPR plan submitted by the producer to the CPCB.

While tech companies accept there have been some lapses on their part, they said banning of imports was an extreme step and the government could have instead opted for financial penalties.

But government officials maintain that they have been lenient, in that they were within their rights to even stop the errant companies’ sales in India, besides levying heavy fines.

“You can’t expect each time you meet and say you need six more months. Once the e-waste management rules kicked in in December 2016, we were meeting the companies regularly and hand holding them. Can they do any sort of non-compliance in any of the developed world?” asked an official.

 

 
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