Sustainability, a trend in European public procurement – Interview with Zoltan Matyas

Recently, in several European countries, there is a trend, by public administrations and governments, to purchase or rent sustainable products and sanction those that are single-use.

This is what happened in Spain last July, when the Spanish Ministry of the Interior cancelled a tender that excluded independent remanufactured consumables. The tender encouraged the procurement of new OEM and non-OEM cartridges, but third-party remanufactured cartridges were excluded, and at the same time Xerox remanufactured cartridges were included.

The international trade association ETIRA challenged the tender and the Ministry of the Interior responded positively. They decided to cancel the tender and propose a new one, where remanufactured cartridges were included in the contracting criteria, according to the valid European GPP (Green Public Procurement) recommendation.

There is another case in Spain, last September, the Government of the Balearic Islands sanctioned HP for €50,000 for selling single-use cartridges, a practice that violates regional legislation.

In 2018, the Government of the Balearic Islands, concerned about the environmental situation of the islands, had begun to ban single-use plastics such as cutlery, straws, plastic bags, etc, and this ban also included single-use cartridges, requiring instead all printer and photocopier cartridges and toners to be refillable, remanufacturable and reusable.

Something similar happened in Italy in 2020 when the Italian government proposed an economic sanction of 10 million euros to HP for deceptive practices regarding the use of toner cartridges in its printers.

The Italian Competition and Markets Authority investigated HP, which showed that for years this company had embedded instructions in the firmware of many inkjet and laser printers, causing the printer to accept original HP cartridges and refuse to print when the cartridges were non OEM or remanufactured, without the consumer being informed of it, which caused the company to be sanctioned.

Examples like these show the growing environmental commitment of European public administrations and their tendency to apply measures to avoid the circulation of single-use products in the market and favor practices such as repair and remanufacturing.

To find out how this change is affecting the printing equipment sector, we have interviewed our Director of International Business Development, Zoltan Matyas.

Do you think that public administrations will bet more and more on green products?

Yes. Reuse and remanufacturing are a worldwide macro trend and Europe remains the driver of the transition and a key market for remanufactured parts and finished products. The European Green Deal, the Circular Economy Action Plan and the goals set by the EU until 2050 all drive this change.

When it comes to Public Procurement there are clear directives from the European Union, the EU GPP criteria clearly outline the directives tender makers should follow in any product.

Specific EU Green Public Procurement criteria for imaging equipment, consumables and print services include the supply of “remanufactured cartridges/containers”. The criteria also establish that “the products must not be designed to prevent remanufactured toner and/or ink cartridges and containers. Constructive, software-based or other measures that prevent the use of remanufactured cartridges and containers should not be present or applied”.

In addition, to avoid as much as possible the environmental impact that the contracted imaging equipment may cause, and to favour ecological practices among the tender, the criteria specify that “points must be awarded for the commitment to provide the highest percentage (share) of reused/remanufactured cartridges/containers”.

In which other countries are happening the same?

The EU Green Public procurement criteria (EU GPP) is voluntary, so every member state can decide if they follow or not and, if they do, how strictly they apply the criteria outlined by the EU Commission. We see a change in all 27 member states with noteworthy positive examples in Italy, France, and Czech Republic.

Are there any European regulations for reuse in the printing equipment sector?

No, there is still no regulation for reuse in this sector.

In fact, in March 2022, the European Commission rejected the proposed Voluntary Agreement of printing equipment manufacturers and will instead bring forward regulations so that reuse is properly regularised for our sector. We expect this regulation to be rather fast and hope for it to be in effect latest by the end of 2024.

One of our industry’s highly respected associations, the UKCRA, made the following comments on this: “The EU’s rejection signals the start of upheaval in which industry players will need to reconsider their business models for positioning in a fast-emerging circular economy. Players such as cartridge collectors and brokers, component suppliers, OEMs, remanufacturers and others through the supply chains, will all need to establish new ways for the consumer to receive a high-quality product every time with increasingly lower impact on the environment.”

How is the ETIRA Association helping to comply with regulations regarding product sustainability?

ETIRA is a trade association, and it represents the interests of inkjet and toner cartridge remanufacturers. It often challenges tenders if it receives a notification of a possible irregularity or non-compliance from any of its members.

It also positions and calls for change or faster progress on regulation like it did earlier this year when it prepared an updated position regarding the forthcoming draft EU regulatory framework for the imaging equipment sector.

Then, ETIRA took a very clear position by proposing to the European Commission to establish some minimum requirements in the new regulatory framework, to reduce waste and favour the reuse or re-manufacturing of imaging equipment.

And how does ETIRA support companies that sell remanufactured products?

ETIRA represents the interests of all parties in the inkjet and toner cartridge remanufacturing industry, from manufacturers to suppliers to end consumers.

Its objective is that the European Union supports reuse and re-manufacturing as the first purchase options for consumers in the EU and the Member States. For this reason, the association is determined to seek support from the European Government to introduce remanufacturing in green policies to increase recycling and reduce pollution.

What are the consequences, for big manufacturers, of the commitment of governments and public administrations to the circular economy?

They all have to revise and change their current business models, logistics and reverse logistics activities.

The current “razor and blades” business model is not circular and it is broken. It is based on putting more and more single used newly made products more and more often and it will no longer be viable. Manufacturers will have to provide end-of-life solutions for their products, apply eco-design criteria and increase reuse in their product mix.

They will have to say goodbye to Firmware updates and most likely will have to simplify and make toner cartridge smartchip available as a spare part within many other critical parts.

And what does it mean for remanufacturing companies like GM, dealers, users and for the planet?

GM Technology´s current core business activity is reverse logistics and remanufacturing and it has a successful and profitable business model and significant know-how which was developed in the last 30 years.

If regulation incentivises the manufacturers to produce eco-design (remanufacturable) products, make components and spare parts available and stop “anti-remanufacturing” practices such as mechanical build, smartchips, firmware updates, short lifecycle components, it will help GM Technology and other remanufacturers to increase efficiency and effectiveness of remanufacturing providing benefits for the channel partners, end users and the planet as a whole.

It even provides a new opportunity for synergies and cooperation between manufacturers and re-manufacturers.

What do GM Technology customers think of this trend?

All customers welcome the circular economy transformation with enthusiasm and hope this new tendency and regulation will bring positive change to a highly competitive sector. Competition from outside of Europe drove margins out of the sector in the last 10 years and change is due.

What benefits do customers get thanks to the new European guidelines regarding green products?

A commitment to environmentally responsible products not only benefits the planet but also brings many advantages to consumers.

The EU Green Public procurement criteria for imaging equipment, seek energy efficiency in products, generating cost savings, they reward the use of remanufactured cartridges, which represent a much cheaper solution than OEM cartridges, they promote practices such as equipment disassembly and repair instead of replacing it with a new one, and they support the purchase of products designed to encourage recycling.

Last March 2022, the European Commission also advanced a proposal for a new Ecodesign for Sustainable Products Regulation, based on the 2009 Ecodesign Directives, which until now only covered energy-related products.

The European Commission has proposed to establish, for groups of products that have common characteristics, different requirements that ensure the sustainability of these products.

Among them, the durability, reusability, upgradeability and repairability of the products are required. This will make it possible to eliminate planned obsolescence and make it easier for consumers to repair items instead of using them and throwing them away.

Efficiency in terms of energy and resource use is also required so that users can save on energy and costs. It will also be required to provide information about the carbon footprint and ecological footprint of products so that consumers can know the impact on the planet of the items they buy, and they can choose the most sustainable products.

What is the future of the printing equipment remanufacturing industry?

It is becoming more and more evident that the printing equipment sector, like many other market sectors, has become aware of the priority of working in a sustainable and environmentally friendly way.

Not only remanufacturers like us, but also big manufacturers like Canon and Ricoh, have seen the importance of moving from a linear economy to a circular one and have started to re-manufacturing their printing equipment.

Remanufacturing is and will continue to be a trend, allowing companies to reduce the carbon footprint of equipment throughout its life cycle and facilitating reuse and repair instead of uncontrollably introducing new items onto the market.

What is GM Technology’s International Sales Department doing to educate customers around the world about the benefits of betting on remanufactured products?

We have a highly experienced international sales team and with consistent coaching and training, we make sure they are always up to date with the latest news trends and information on the market. 

Our approach to our clients is a partnership approach and we continuously share and exchange information with them daily allowing them to be proactive in their local markets bringing valid arguments and a global perspective to their clients regarding the benefits of choosing remanufactured printing equipment.

Consultative sales and a “win-win” focused account management of valuable information exchange help our customers to sell more and better in a sustainable way.

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