September/October 1991
Reassessing Government Control of Precious Metals
The recent International Precious Metals Institute conference gave attendees a look at the economic, environmental, and international trade issues that will affect the industry.
By Robert J. Garino
Robert J. Garino is director of commodities for the Institute of Scrap Recycling Industries (Washington, D.C.).
The precious metal industry is facing more than a sluggish economy these days. Proposed environmental, legislation in the U.S. Congress and international trade treaties could seriously threaten the industry, particularly secondary processors and refiners.
Nevertheless, several speakers at the international Precious Metals Institute's (IPMI) (Allentown, Pa.) annual conference, held in Naples, Fla., this summer, offered some optimism about recyclers' abilities to meet proposed regulations and standards
Tracking RCRA Reauthorization
Walter D. Ramsay, IPMI's Washington consultant stationed in Arlington, Va., discussed the pending reauthorization of the Resource Conservation and Recovery Act (RCRA) and how it might affect the secondary precious metal industry. "It will happen," he stated, but Congress is still holding hearings on both the House and Senate versions, so there can be no sure answer yet about RCRA's future effect on the precious metals industries. Nevertheless, "the secondary metal recovery industry can expect additional regulation or, at the very best, more intense scrutiny" in the near future, Ramsay said.
On the Senate side, Ramsay reviewed separate bills introduced by Sens. Max Baucus (D-Mont.) and John H. Chafee (R-R.I.). The Baucus bill contains a “philosophic breakthrough," he asserted, in that it recognizes that recycling does not require the same type of regulation as waste disposal. The bill introduces a subtitle for “secondary materials," under which recycling activities would be subject to a regime different than RCRA's waste management provisions. The legislation also encourages commodity-specific recycling standards, he noted.
In contrast, Ramsay pointed out, the Chafee bill would give the Environmental Protection Agency authority to regulate recycling activities by amending the definition of "solid waste" to include recyclable materials. In short, the bill would place all recycling activities under full RCRA coverage, he said.
The timing on RCRA reauthorization is “unclear,” Ramsay observed, stating that Baucus, for example, wants to present a finished bill to the Senate by the end of the 1991 session, but many doubt that the bill will be ready. Still, the legislation could be ready "early next year," he said, which would allow sufficient time for consideration before Congress adjourns in October 1992.
In the House, a first draft of RCRA reauthorization legislation should be ready in early September, Ramsay noted, with final legislation ready for a House vote in March 1992.
Though some think the issue may not even be resolved in the current two-year session of Congress, the following Congress will have to consider Superfund reauthorization, and no politician wants to consider Superfund and RCRA at the same time, Ramsay said.
Basel’s Threat to International Trade
International trade issues were also discussed in the context of the Basel Convention on the Control of Transboundary Movement of Hazardous and Other Wastes.
Promulgated by the United Nations Environment Program in March 1989, the treaty calls for a comprehensive regulatory program to supervise and control the international movement of "hazardous wastes." According to Arlette Shagarofsky-Tummers, Associates Europeane des Metaux (Brussels, Belgium), by June 1991, 52 countries had signed the agreement, while 10 countries--including France, Norway, and Switzerland--had ratified it. The convention will be implemented after 20 nations have ratified it, possibly as soon as "early 1992" but more likely in mid-1992, she said.
Both Shagarofsky-Tummers and John C. Bullock, environmental counsel for Handy & Harman (Waterbury, Conn.), criticized the treaty for its failure to distinguish between hazardous wastes earmarked for disposal and scrap materials destined for recycling. Basel also allows each participating nation to use its own definition of hazardous waste, Bullock noted. This provision is troubling, he said, because some countries, including those in the European Community (EC), classify all secondary nonferrous metals as "special hazardous wastes." While the EC typically imposes only limited restrictions upon the movement of such "special wastes" in recycling transactions, its classification of secondary precious-metal-bearing materials as hazardous waste would place those materials under Basel's full notice-and-consent requirements, Bullock pointed out. Consequently, the international trade m secondary Precious metals would be subject to the same restraints as international waste disposal transactions, he said.
An OECD Compromise?
Shagarofsky-Tummers and Bullock also discussed proposed variations to the Basel Convention, highlighting ideas by the Organization for Economic Cooperation and Development (OECD), which Bullock said may offer "the solution to Basel." The OECD recognizes the economic importance of secondary resource recovery and has proposed establishing a "green/amber/red" classification system to distinguish between hazardous and nonhazardous recyclables as well as scrap materials destined for recycling and wastes destined for disposal, he noted. The OECD feels that emphasizing the inherent value in scrap for recycling will help ensure sound environmental management and reduce the need for Basel-type regulations for trade in secondary materials.
Despite the complexity of the issue and the flaws in the treaty, Basel ratification is moving ahead, both speakers said, stressing the "inevitability" of the treaty's passage. Only the exact timing was unclear.•
The recent International Precious Metals Institute conference gave attendees a look at the economic, environmental, and international trade issues that will affect the industry.