JP Fluorocarbon Emission Control Act — Manager Obligations for Commercial Refrigeration and Air Conditioning Equipment
ENFORCEMENT TIMELINE
Fully enforced April 2020 (Direct penalties for recovery violations)
Overview
Under the Act on Rationalizing the Use of Fluorocarbons and Appropriately Managing Designated Products, every business (as manager) that owns or uses commercial air conditioning or refrigeration equipment classified as a Class I designated product is subject to a legal obligation. Aimed at preventing leaks throughout the fluorocarbon life cycle, from use through disposal, the law requires routine and periodic inspections, calculation and reporting of leak volumes to the national government, and the issuance and retention of a certificate of fluorocarbon recovery whenever equipment is disposed of.
Enforcement Timeline
April 2015: The Act on Recovery and Destruction of Fluorocarbons is substantially revised and renamed the Act on Rationalizing the Use of Fluorocarbons, introducing the obligation to prevent leaks during use.
April 2020: The amended act takes effect, introducing a direct fine of up to 500,000 yen for failing to recover fluorocarbons at disposal, and tightening process management requirements during demolition work.
End of July each year: The deadline for businesses whose calculated leakage for the previous fiscal year reached 1,000 tonnes of CO2 equivalent or more to report to the national government.
2036: The deadline for achieving the final reduction target under the amended law, an 85% reduction in HFC consumption.
Business Impact
Businesses are required to conduct simple inspections at least once every three months for every Class I designated product they own, and periodic inspections by a qualified professional (once every one to three years) for equipment above a certain size, keeping records of both. Failing to comply, or failing to report when leakage exceeds 1,000 tonnes of CO2 equivalent per year, or submitting a false report, carries a fine of up to 500,000 yen.
Failing to properly hand off fluorocarbons to a recovery provider and obtain a certificate of recovery when equipment is disposed of or removed during building demolition is subject to a direct criminal fine of up to 500,000 yen, without any prior administrative guidance, which can significantly damage a company's brand as a compliance violation.
Because the supply of substitute fluorocarbons such as R410A and R404A is shrinking and prices are rising as reduction targets phase in, continuing to operate aging refrigeration equipment increases the cost of repairs when leaks occur, creating pressure for early capital investment in energy-efficient equipment using green refrigerants, including natural refrigerants and low-GWP alternatives.