It is planned to collect a recycling fee from importers of foreign IT equipment
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It is planned to collect a recycling fee from importers of foreign IT equipment that have Russian analogues to support domestic manufacturers, said the head of the Ministry of Digital Development, Maksut Shadayev. The idea has been discussed since 2022 in relation to products containing gold and rare earth metals, but now, according to Kommersant, it could extend to a wide range of electronics. The introduction of a fee only for importers will violate WTO norms; similar preferences in the automobile industry have already been the subject of international disputes, lawyers emphasize.
The head of the Ministry of Digital Development, Maksut Shadayev, confirmed the ministry’s intention to introduce a recycling fee from importers of foreign IT equipment. “We will carefully raise prices for foreign goods through recycling fees and use this waste collection as a subsidy for Russian producers,” he explained on October 18 during the Infotech forum in Tyumen (quoted from “Interfax”). The minister noted that we are talking about recycling collection for those items of foreign solutions where there are Russian analogues, but did not specify the specific nomenclature. The Ministry of Digital Development refused to disclose details.
Recycling collection initially appeared in the automotive industry in 2012, formally to protect the environment, but de facto as compensation for the reduction of import duties after Russia joined the WTO. At first, only importers paid it, but since 2014, due to WTO pressure, the fee has been extended to local factories. At the same time, manufacturers from the Russian Federation began to be paid compensation in the form of industrial subsidies. Currently, recycling fees are also levied on agricultural and special equipment.
The government considered financing the Russian electronics industry through recycling last spring (see “Kommersant” dated May 17, 2022). In the original version, it was assumed that the fee would affect only foreign products containing gold and rare earth metals (see “Kommersant” dated February 27). According to a Kommersant source at a major equipment manufacturer, the possibility of introducing recycling collection for a “wide range of electronics” has been discussed for “at least a month.” “The collection is needed primarily to raise funds to extend government decree No. 407 until 2024 (introduces a preferential rate for manufacturers on loans taken for the purchase of electronic components.— “Kommersant”),” he explains.
Director of Public Relations for the Association of Trading Companies and Manufacturers of Electrical and Computer Equipment RATEK Anton Guskov said that the fee will only lead to higher prices for electronics: “It is wrong to support some market participants, essentially at the expense of consumers. It is necessary to increase the efficiency of Russian producers and support them with tax incentives.” He admits that if a fee is imposed on Russian producers, the subsidies may turn out to be insufficient.
Yadro, however, told Kommersant that the company does not see any risks and supports the initiative: “Such a fee is a form of leveling the playing field for local and foreign manufacturers. Domestic companies are obliged to support customer service, fulfill warranty obligations and regulatory requirements, but in the case of supplies of foreign equipment without a local office, the foreign manufacturer has no such obligations.”
As presented, the recycling fee is incompatible with the basic WTO rule prohibiting discrimination against imported goods, emphasizes Sudohod senior lawyer Vladislav Shtrem: “Complaints to the WTO from foreign companies are inevitable, since the Russian Federation continues to be a fairly large market for the sale of IT equipment.”
At the same time, the lawyer admits, “it is now unclear whether it makes sense for foreign companies to apply to the WTO, taking into account the geopolitical and economic situation.”
Managing partner of Varshavsky and Partners Law Firm Vladislav Varshavsky adds that such disputes take a long time, during which the Russian Federation can adjust the rules for collecting recycling fees. In addition, Yuri Fedyukin, managing partner of Enterprise Legal Solutions, clarifies that the majority of electronics manufacturers currently do not officially supply products to the Russian Federation: “So it is not they who will pay the recycling fee, but parallel importers, who will ultimately shift payments to the end consumer.”
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