Implementing Directive 2012/19/EU, the German Electrical and Electronic Equipment Act (ElektroG) came into force in 2005, aiming to prevent environmental damage from electronic waste and hazardous substances and increase the proportion of reusable or recyclable materials. For distributors such as manufacturers, dealers and importers, this means increased effort and compliance with many regulations, including the obligation to deposit an insolvency-proof guarantee.
Insolvency-proof guarantee - for whom is it mandatory and why?
The insolvency-proof guarantee ensures that there are financial resources available for the disposal of waste electrical and electronic equipment for which no manufacturer or authorized representative is registered. This can be the case, for example, when it is an old product whose manufacturers have not renewed their registration because they have not put the item back into circulation. Alternatively, it is also possible that consumers only dispose of the device decades after purchase, while all registrations expired years earlier.
In both cases, the public waste disposal companies must carry out the recycling and are reimbursed for the costs incurred by stiftung ear. The situation is different for devices that were designed for commercial use (B2B): Here the companies themselves are responsible for returning the product to the manufacturer or distributor.
If you market electrical and electronic goods for private households or manufacture such devices, you must deposit the guarantee. If, on the other hand, your business purpose is to manufacture or market electronic and electrical products for commercial use, you are exempt from submitting the insolvency-proof guarantee. It is therefore crucial whether you provide devices for end users in the sense of private individuals or for companies (industry).
A violation of the obligation to deposit a guarantee can be punished as an administrative offense and subject to a fine of up to EUR 100,000 by the Federal Environment Agency.
Individual guarantee vs. collective guarantee
There are several options available to you to fulfill your obligation. For example, after a corresponding application, you can transfer or deposit money as security to the depository of a German district court of your choice. You also have the option of setting up a so-called guarantee with a bank on first demand. Alternatively, arrange a first-demand guarantee with a bank. These three options are individual guarantees. You set up this guarantee and create the proof yourself or commission your authorized representative to do so. Depending on the bank or district court, these processes can take several months and above all cost you a lot of money and effort to set up as well as renew. The guarantee to be deposited may only be a few euros, even if many tons of devices are sold depending on the category. The process of providing the guarantee is therefore out of proportion to the value of the guarantee.
The fourth option is to participate in an approved guarantee scheme. You purchase this collective guarantee from a guarantee service provider, who then includes you in their collective guarantee scheme.
Guarantee amount and validity period
The amount of the guarantee to be deposited depends on the costs that are likely to arise for the disposal of the old devices if the guarantee case occurs. The following formula is used for the calculation:
Quantity of devices per device type in tons x return rate in percent x estimated disposal costs in euros per ton.
The quantity report that you submitted to the stiftung ear is used as the basis for the calculation of the guarantee amount. It is important to note that you must adjust the guarantee amount after the validity period has expired or if you bring a larger quantity of the respective device type onto the market than originally planned. As the distributor, you are obliged to ensure that the sum deposited covers the disposal costs.
The period of validity for an insolvency-proof guarantee is one year. You then have to deposit a new guarantee again if you want to bring devices onto the market in the following year. Alternatively, you can deposit a total guarantee amount that covers several validity periods, if you already know how much you will sell over the term of the respective years. Depending on the total amount of the guarantee, another type of guarantee may be more suitable for you.
Insolvency-proof guarantee - of course with CERTIFY
We have set up our own approved collective guarantee scheme, as you can see in this list.
As experienced experts, CERTIFY will provide you with comprehensive advice on the ideal type of guarantee and support you with all your obligations arising from the Electrical and Electronic Equipment Act. We ensure that all deadlines are met and always find the most economical solution for you. You will receive the proof of guarantee from us within 48 hours after signing the contract and you only pay the actual guarantee amount as well as a small annual participation fee for each type of device – nothing more. Quick and easy. Save yourself months of work and a lot of money. Just give us a call or write to us – we’re happy to help!