Expert view on how the EU USB-C regulation will impact the secondary mobile market in Europe

Secondarymarket.news asked these experts: starting on 28 December 2024, the EU will implement a ban on importing non-USB devices, such as smartphones and tablets, under new legislation. Do you agree with this statement, or do you think it doesn’t apply to used or refurbished devices?

NorthLadder,  a software enabler for for buying, selling, and trading used electronics,  cautions that EU regulations targeting new device production and imports could limit access to used devices crucial for the circular economy. These restrictions risk undermining second-life markets, which reduce e-waste and extend device lifespans, potentially derailing the EU’s environmental goals. NorthLadder advocates exempting the secondary market from such measures, working with regulators, telcos, and retailers to promote sustainable trade-in practices and ensure affordable, high-quality pre-owned devices remain accessible to consumers for a more sustainable future.

The law and its implications for second-hand devices

Recommerce, A French recommerce company specializing in refurbishing and reselling used electronics and founder of pressure group Eurefas, clarified that the EU's new regulation is clear: no smartphones or tablets without USB-C ports can be imported into the EU after December 28, 2024, regardless of whether they are new or second-hand. However, the company noted that devices bought back within Europe after the deadline could still be resold as refurbished, even if they don't comply with the USB-C standard.

On the other hand, some industry insiders believe that the statement lacks sufficient clarity. Research company Counterpoint suggested that the regulation would likely not apply to used devices. They argued that such a broad application would undermine the EU's sustainability goals and negatively impact the burgeoning secondary mobile market.

Regulation and the secondary market: a grey area

Analysts from CCS Insight weighed in on the matter by noting that the Radio Equipment Directive (RED), which forms the foundation of the regulation, does not distinguish between new and used devices. As a result, the law applies to both types of devices. Furthermore, those familiar with the EU's regulatory framework hinted that the current wording of the legislation would likely remain unchanged, even though it doesn't take into account the secondary market's growth over the last few years.

One of the challenges is that the law was written and amended during a time when the secondary market was far less established. Now, with the growing importance of the secondary market in Europe and its reliance on imported stock from the US, there are concerns that the new regulation may not fully account for its economic potential.

Impact of imports from North America and Japan

In a deeper analysis of the situation, it was highlighted that some companies in the secondary market have relied on imported devices from North America and Japan. These devices, while valuable for resale in Europe, may no longer be allowed under the new regulations. According to CCS Insight, companies that support the EU's directive generally fall into two categories: those who believe reducing US imports will lead to a stronger, long-term circular economy within Europe, and those who don't rely on imported stock and therefore support the regulation for competitive reasons.

However, some industry players raised questions about the environmental logic of shipping devices across oceans and continents. They argue that the environmental impact of importing devices may not be significantly worse than the environmental impact of consumers purchasing new devices, which also involves international shipping.

Clarifying the directive: Cyculus’ and Cykero’s perspectives

Cyculus, offering Device Processing as a Service, pointed out that the EU regulation applies to both new and used devices entering the market after 28 December 2024. Devices that were already on the market before this deadline will still be allowed to remain and be sold. However, they also noted that no non-USB-C devices from outside the EU will be allowed to enter after the deadline.

Cykero, a German-French company buying and selling in sustainable refurbished electronic devices, expressed a similar view, noting that the regulation is primarily focused on standardizing charging interfaces and reducing e-waste. They suggested that refurbished devices, which align with the EU's sustainability goals, should not fall under the regulation. Nonetheless, they emphasized that clearer guidance from regulators would be beneficial to prevent misinterpretations.

Enforcement: will the approach be strict or flexible?

When asked about the enforcement of the EU import ban, many secondary market players emphasized the importance of transparency and compliance across Europe. They stressed that the market needs to respect all regulations, including paying the appropriate VAT, copyright levies, and eco contributions like WEE fees, to create a fair and sustainable marketplace.

Despite concerns about uneven enforcement across countries, the industry believes that a transparent and well-regulated market will help establish a strong European circular economy. Players in the secondary mobile market are hopeful that consistent regulations will promote better supply chain practices and encourage sustainable business models.

Impact on the supply chain: regional or global repercussions?

The uncertainty surrounding the regulation has left some wondering how it will affect the supply chain for secondary mobile devices. While players in the industry believe that transparency is key to building a sustainable European circular economy, concerns about tighter supply remain. The regulation could potentially impact both regional and global supply chains, depending on how strictly it is enforced.

Some experts suggest that the market will need to adapt by creating more localized supply chains and focusing on creating stronger European-based recycling programs. This shift may take time but could ultimately provide the foundation for a more self-sufficient and sustainable mobile device market in Europe.

Pricing: will prices rise due to reduced supply?

One immediate concern for players in the secondary market is how the new regulation will affect pricing. With fewer new devices available in the market due to the USB-C compliance requirement, the pricing for second-hand devices, particularly Apple smartphones, is expected to rise. As the availability of new devices shrinks, refurbishment players are likely to capture a larger share of the market, which may drive up prices.

Trade-in schemes: Will they grow under the new regulations?

Despite the potential for higher prices, many in the industry believe that the EU regulation will lead to the growth of local trade-in schemes. By establishing transparent and clean market conditions, the regulation could create a favorable environment for trade-ins, ultimately fueling the supply of refurbished devices. This growth is expected to help structure the overall European circular economy and encourage a broader range of used products to be returned for refurbishment.

Final thoughts: building a stronger, more sustainable market

While there is still uncertainty about the exact impact of the EU's new USB-C regulation on the secondary mobile market, many players in the industry are optimistic that it will lead to cleaner, more transparent market conditions. The focus remains on promoting stronger, local circular models that benefit the European economy, reduce environmental impact, and support job growth. Despite the challenges posed by the regulation, the long-term vision is one of sustainability, innovation, and growth.