ISRI contributes to US complaint over China solid waste import ban

China solid waste law
The 17th meeting of the 13th National People's Congress approved the revised China solid waste law

The Institute of Scrap Recycling Industries (ISRI) has written to the Office of the US Trade Representative (USTR) about its concerns regarding China’s upcoming solid waste ban for inclusion in the annual China World Trade Organisation (WTO) Compliance report.

US recycling trade organisation ISRI noted in the letter that China has failed to notify the WTO of rounds of import bans, overly-strict product standards, challenging licensing requirements and non-transparent quota issuances.


In the letter ISRI vice president of advocacy Adina Renee Adler wrote: “China has been phasing in prohibitions and non-tariff restrictions on imports of scrap materials since 2018 (which the Chinese Government inexpertly lumps in with other non-value waste streams and ambiguously refers to all of it as ‘solid waste’).

“The first set of prohibitions implemented in early 2018 had been notified to the WTO, but subsequent rounds of import bans, overly-strict product standards, challenging licensing requirements and non-transparent quota issuances were not notified.

“Furthermore, it is our understanding that the Chinese Government intends to ban all ‘solid waste’ by 2021, but there has been no transparency on such a policy, leading to great uncertainty in the marketplace. As a result, US scrap exports to China have dropped precipitously since the first announcements were made.”

Adina Renee Adler
Adina Renee Adler, vice president of advocacy, ISRI

She added that since 2017, there has been general talk in the market about a blanket import ban on recyclable materials by 2021, but no official law or regulation has been developed, discussed or implemented to fulfil this intention. Instead, non-tariff barriers have been applied to scrap commodities.

“Within the law is a single but vague provision to ‘basically realise zero imports of solid waste’ and a second provision with a harsh penalty to ‘the carrier shall bear with the importer’ in instances where ‘solid waste is imported into the territory’ in violation of the first provision on zero imports.

“As a result of this threat – but without clear guidance on definitions, scope and timeline – the shipping lines have made their own interpretation of this law by announcing a wide-range of new scrap shipping policies, including to stop carrying scrap commodities to China as early as June 2020. This resulted in market disorder and additional uncertainties about future exports.”

She also noted in the letter that China has reclassified aluminium, brass and copper and by doing so has recognised that they are not a waste but a valuable raw material. However, the standards required to meet this classification are beyond recognised industry standards that only a few recyclers in the world could meet. Again, she stated that China has not notified the WTO about this reclassification.

On licensing and quotas, she wrote: “For about 15 years, China has implemented an import/export licensing system to control the flow of recyclable commodities in order to combat what had been a large problem of illegal shipping of end-of-life products and materials being illegally dumped in China.

Several of our members whose existing export licenses were expiring reported inefficiencies and possible extortion by Chinese Government entities

Adina Renee Adler

“ISRI has been supportive of this scheme because it opened channels for valuable, commodity-grade scrap commodities to meet Chinese manufacturers’ strong demand for such inputs, but since 2017, the policy has been implemented obscurely. For example, several of our members whose existing export licenses were expiring reported inefficiencies and possible extortion by Chinese Government entities during the renewals process.

“Additionally, only import license holders within China are issued quotas on the amount of recycled commodities they may import into China. Since 2017, the Chinese Government has issued a trending decrease in quotas of all scrap commodities, which greatly contributes to the decline in US exports. There is no specific schedule for all the issuance of quota nor a clear understanding of the timeline to fulfil the quotas of the methodology used to determine their quantities.”

Finally, she also noted that “we have not found the Chinese Government to be receptive to dialogue on these measures” in the advocacy put forward by USTR, the US Department of Commerce and US Department of State at the WTO.

Paul’s view

Paul Sanderson, REB Market Intelligence
Paul Sanderson, REB Market Intelligence

This is a punchy, honest and accurate appraisal of the actions of the Chinese Government by ISRI’s Adina Renee Adler.

As noted last week by me, China has never written down the date on which it will ban imports of ‘solid waste’ except in a transcript of a press conference. As mentioned in the ISRI letter, the law does not give a date other than to say it will basically realise zero imports of solid waste.

It has never notified the WTO of its intention to ban import of solid waste or given the HS commodity codes as it did for recycled plastics and mixed paper when these were banned in 2018. It might yet still do this, as China does have a habit of deciding on it then telling everyone last minute.

This isn’t an acceptable way to conduct international trade.

The US has already complained to the WTO about China’s actions over this. But will it make much difference?

With the ban being an explicit policy ordered by President Xi Jinping, it is highly unlikely that the policy will change unless China finds a way to save face. This is still possible, and as I mentioned in the same article linked above, there remains a remote possibility of some form of reclassification.

But as noted by Adina Renee Adler in her letter, the reclassification of metals can only be met by a few recyclers worldwide, and you’d have to imagine that any reclassification of paper grades would be equally but differently challenging.

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