Retroworks de Mexico Regulatory Update

Here are the facts about our permits at Retroworks de Mexico.

There is a distinction between final recycling or disposing, and disassembly as a maquila. It is possible to be permitted to take stuff apart (we are) but not yet to be permitted as a final end market for the CRT glass.

1. YES, we do have a purchase order for processed CRT Glass from a smelter in Mexico. Ultimately, we plan to process and recycle CRT glasses and substrates in Mexico.
   
2. The purchase order for the CRT glass, as an end market, requires breaking and processing of CRT glass, which we were notified in February we are not yet authorized to do.
3. We hired a SEMARNAT (Mexico EPA) consultant to review our facility plans (copied from our Vermont facility) and to work with SEMARNAT to make sure they were acceptable.
4. In the meantime, we have been informed repeatedly that our permit to import TVs and monitors for refurbishing or dismantling is valid, so long as the commodities - CRTs, plastic, copper, etc. - are re-exported.
   
5. We have continued to keep bare CRTs intact for re-import to USA. This makes Mexico either a "transit country" or "generator" of CRT glass, or possibly neither.

There are other important legal interpretations and distinctions (was the "glass" generated in Mexico as a byproduct of operations? Or was it sent to Mexico for re-import to the USA, making Mexico a "transit" country? Or, under Maquila law, was the CRT never "imported" into Mexico at all?) Throughout, we have taken a conservative approach.

These are the kind of legal questions I grappled with a decade ago, as Massachusetts DEP implemented the first-in-nation CRT Waste Ban (I was DEP Recycling Program Director).








The important thing is that we are who we say we are, and we do what we say we do. Here are the constraints we currently operate under:

• Yes, Retroworks de Mexico is a permitted maquila (the same as a TV assembly company)
  
• Yes, Retroworks de Mexico is authorized to inspect, test, repair, and dismantle TVs and monitors into bare CRTs.
• Retroworks de Mexico has alternative CRT markets, and is not doing anything that any reputable CRT recycler is not doing (as a generator of intact, dismantled CRTs).
• Retroworks de Mexico staff have undergone thorough training in Vermont, and Vermont staff have been down to train Las Chicas Bravas.
• Retroworks de Mexico provides complete transparency, inviting NPR Living on Earth reporters, ADEQ staff, Tucson officials, competitors and suppliers to tour our facility.
• Retroworks de Mexico has provided film evidence of what we are doing online.
• American Retroworks Inc. has rented warehouse space to store CRT TVs and Monitors indoors, according to EPA Rules.
  

Please do not confuse our application as an end market for CRT glass, a work in progress, with our permit to disassemble or refurbish as a maquila.

The CRT Glass Test is tough to comply with. Doing the right thing is expensive. When I first opened Retroworks de Mexico, we could ship CRTs to Samsung intact while waiting for the smelter purchase order and SEMARNAT permit. We could ship CRTs intact to Dlubak Glass, which had a spotless record covering decades of CRT glass recycling. And we could ship to TDM of Mexicali. It's only the good actors who are in the spotlight, and we are proud to be mentioned in the same article as any of those companies.

We are about finding solutions, not "loopholes". I do not know what specifically our competitors are doing with CRTs they collect in Arizona, but since they are raising questions about our handling, perhaps it is best to discuss the advantages and disadvantages of different CRT recycling options in public.

The details of the Basel Convention, EPA notification, DOT labelling, OSHA law, RCRA, commodity transport, etc. are complex. American Retroworks Inc. was among the first in the USA to file export for reuse notification and was listed on EPA's website as an exporter for recycling to Mexico until October. We believed we needed to file as an exporter for recycling in advance if we intended to process the CRT glass at the smelter in Mexico once the February 2009 permit questions were fully resolved (vs. re-transporting the CRTs back to the USA to transport them back to Mexico).

Should we have notified EPA of intent to export to Mexico as an end-market before or after breaking the CRT glass? If we had gotten all the breaking questions resolved in Mexico in 2009, this would have been easy. In hindsight, this "chicken or egg" end market documentation has created the false appearance that our maquila authority is rescinded. Mexico EPA has rescinded some permits, but they are for CRT glass processing, the one we are still applying for, not disassembly for re-export.

The tempest has clouded the fact that some companies are basically trying to do the right thing, while others are dropping ocean sea containers to be loaded with ewaste for transport to China.

Despite dozens of offers, we had NOT started trading processed CRT glass from USA recyclers for our end market because we lacked the legal status to manage broken glass as a commodity. We did see that those companies offering processed CRT glass ARE doing the right thing, and we would love to work with those companies when this is settled. We have the engineering studies, we have the purchase order, we have the market. We could have made a lot of money if we had started trading CRT glass, but we have constantly erred on the side of caution.

There is another list of companies which had no processed CRT glass, which only had intact, cherry picked, junk material. They were only interested in price.

And those are the ones trumpeting our problems with the new processing permit. Hmm.