Draft of Interim Measures for Solicitation of Comments on the Provisional Provision and Management of Decommissioning Expenses for Key Hazardous Waste Centralized Treatment Facilities and Sites

The Department of Natural Resources and Eco-Environment issued a letter on publicly soliciting opinions on the “Interim Measures for the Advancement and Management of Decommissioning Expenses for Key Hazardous Waste Centralized Disposal Facilities and Sites (Draft for Solicitation of Comments)”. The letter of opinion stated that it is for the effective prevention and control of hazardous waste pollution risks. To protect the ecological environment and protect human health, in accordance with Article 88 of the Law of the People’s Republic of China on the Prevention and Control of Environmental Pollution by Solid Wastes, we have studied and drafted the Interim Measures for the Advance and Management of Decommissioning Expenses for Key Hazardous Waste Centralized Disposal Facilities and Sites ( Draft for Solicitation of Comments)” and its preparation instructions.

The measures are now publicly solicited for opinions, and the publicity period is from July 16, 2021 to August 15, 2021. If you have any comments, you can send feedback to the Department of Natural Resources and Ecological Environment of the Ministry of Finance, the Department of Solid Waste and Chemicals of the Ministry of Ecology and Environment, and the Price Department of the National Development and Reform Commission through letters, e-mails, etc.

Interim Measures for the Advance and Management of Decommissioning Expenses for Key Hazardous Waste Centralized Disposal Facilities and Sites (Draft for Solicitation of Comments)

Chapter General Provisions (Purpose and Basis) In order to standardize and strengthen the pre-provision, use and management of decommissioning expenses for key hazardous waste centralized disposal facilities and sites, effectively prevent and control the environmental risks of hazardous waste, protect the ecological environment, and protect human health, according to the “People’s Republic of China” Laws and regulations such as the Law on the Prevention and Control of Environmental Pollution by Solid Wastes, the Accounting Law of the People’s Republic of China, etc., formulate these measures.

(Definition) Expenses for decommissioning of key hazardous waste centralized disposal facilities and sites are funds that are extracted and used by enterprises on their own, and are specifically used to perform the decommissioning responsibilities and obligations of hazardous waste centralized disposal facilities and sites.

(Scope of Application) These Measures are applicable to the advancement, use and management of decommissioning expenses for hazardous waste landfills within the territory of the People’s Republic of China. Provisions for the advancement, use and management of decommissioning expenses for other key hazardous waste centralized disposal facilities and sites may be formulated by the financial departments, price authorities, and ecological environment authorities of each province (autonomous region, municipality, and city under separate state planning) based on the actual conditions of the region.

(Main Concept) The term “hazardous waste” in these Measures refers to solid wastes with hazardous characteristics that are included in the national hazardous waste list or identified in accordance with the hazardous waste identification standards and identification methods prescribed by the state.

Responsible units refer to the legal entities of hazardous waste landfills that hold hazardous waste business licenses and the legal entities that industrial enterprises self-build hazardous waste landfills.

The decommissioning period refers to the subsequent maintenance period after the hazardous waste landfill is closed, in order to achieve environmentally sound effects. According to relevant national regulations, the follow-up maintenance period of the hazardous waste landfill is tentatively set to 30 years after the closure. The relevant national regulations shall formulate separate measures.

(Basic Principles) It is the legal responsibility and obligation of the responsible unit to advance the decommissioning expenses of hazardous waste landfills. Decommissioning expenses are managed in accordance with the principles of “enterprise advancement, government supervision, ensuring demand, and standardized use”, and are included in the investment budget or production cost of the responsible unit.

(Advance and Management Plan) The responsible unit shall establish an advance and management plan for decommissioning expenses in accordance with the provisions of these Measures, and incorporate the plan and actual implementation into the review content of the hazardous waste business license application. The legal entity of an industrial enterprise self-built hazardous waste landfill shall include the plan and actual implementation in the review content of the pollutant discharge permit application.

Chapter II Fee Accrual

(Expense withholding and amortization) The responsible unit shall calculate the total decommissioning expenses (disposal expenses) in accordance with the principle of satisfying the stable operation of the hazardous waste landfill after decommissioning, and calculate the total decommissioning expenses (abandonment expenses) in accordance with the relevant provisions of the Enterprise Accounting Standards, and include them in the original value of the relevant assets at one time. Before decommissioning, it is amortized annually according to the depreciation method of fixed assets and included in the production cost.

(Expense Standards) According to the “Management Measures for Hazardous Waste Operation License”, “Hazardous Waste Landfill Pollution Control Standard” (GB18598-2019) and other regulations, the low decommissioning cost advance standard:

Flexible landfill. If the total storage capacity is less than 200,000 cubic meters (inclusive), it is calculated according to the standard of 200 yuan/cubic meter; if the total storage capacity is less than 200,000 cubic meters (inclusive), the excess part is calculated according to the standard of 150 yuan/cubic meter, exceeding 500,000 cubic meters For meters, the exceeding part shall be calculated according to the standard of 100 yuan/cubic meter.

2. Rigid landfill. If the total storage capacity is less than 200,000 cubic meters (inclusive), it is calculated according to the standard of 30 yuan/cubic meter; if it exceeds 200,000 cubic meters, the excess part is calculated according to the standard of 20 yuan/cubic meter.

The provincial price authorities, together with the finance and ecological environment authorities at the same level, can determine the decommissioning cost forecast for the administrative area on the basis of the aforementioned annual decommissioning cost advance low standard based on factors such as the local economic development level, labor costs, and actual demand for decommissioning work. Raise the standard, but not lower than the national standard.

On the basis of the above-mentioned standards, the responsible unit may appropriately increase the decommissioning cost extraction standard according to the actual needs of the decommissioning work. Article 9 (Calculation of Costs) For newly-built or constructed hazardous waste landfills that have not been in operation, the decommissioning expenses shall be pre-deducted and amortized in accordance with the provisions of Articles 7 and 8 of these Measures from the year of operation until the operation is closed. Among them, the total advance decommissioning fee = the total storage capacity of the landfill × the standard stipulated in Article 8 of these Measures.

For hazardous waste landfills that have been in operation before the implementation of these measures, the total pre-decommissioned expenses are composed of the addition of two parts, namely:

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(1) The accrued cost of the filled hazardous waste storage capacity = the filled storage capacity × (according to the cost standard specified in Article 8 of these Measures × the proportion of the remaining storage capacity in the total storage capacity). The part that should be amortized after the accrual can be amortized within no more than 5 years from the date of implementation of these Measures until the closure of the site.

(2) The accrued cost for the unfilled hazardous waste storage capacity = remaining storage capacity × in accordance with the cost standard stipulated in Article 8 of these Measures. The decommissioning expenses shall be amortized based on the remaining storage capacity and amortized based on the actual landfill volume from the year when these Measures are implemented, until the operation is closed.

Article 10 (Fund Deposit) Before April 30 of the following year, the responsible unit shall deposit sufficient funds in the decommissioning expense fund account equal to the amount of amortization of decommissioning expenses in the current year.

Article 11 (Bearing Expenses) If a hazardous waste landfill is decommissioned or terminated in advance, the decommissioning expenses shall be borne by the responsible unit.

In the event of a change in the hazardous waste business license or the change in the ownership of the industrial enterprise’s self-built hazardous waste landfill, the decommissioning expenses and maintenance responsibilities shall be borne by the responsible unit after the change.

Chapter III Expense Management and Use

Article 12 (Accounts) The responsible unit shall establish a decommissioning expense fund management system, and apply to the bank for the establishment of a decommissioning expense fund account in the year when the decommissioning expenses are accrued.

Article 13 (Accounting) The accounting treatment of decommissioning expenses shall comply with the provisions of the unified national accounting system.

Article 14 (Use of Funds) The funds for decommissioning expenses shall not be misappropriated or misappropriated, and may only be used to pay for the expenses necessary for the performance of the decommissioning responsibilities. The decommissioning expenses funds that are idle in the account can be appropriately invested in value preservation and appreciation, but in time deposits and the purchase of treasury bonds.

Article 15 (Method of Use) The decommissioning expenses shall meet the actual requirements for fulfilling the decommissioning responsibilities. If the funds for the decommissioning expenses are insufficient, the responsible unit shall make up for it. The balance shall be adjusted and used by the responsible unit in accordance with relevant national laws and regulations.

Article 16 (Reporting System) Responsible units shall promptly disclose the receipt and expenditure of accrued expenses, account management, use of funds, etc.

Chapter IV Supervision and Administration

Article 17 (Ownership Management) The decommissioning expenses fund drawn by an enterprise belongs to the enterprise’s self-use funds, and other departments and units shall not adopt the forms of collection, escrow, etc. to centrally manage and use them, unless otherwise provided by national laws and regulations.

Article 18 (Supervision Content) The local financial department shall, in conjunction with the relevant competent departments at the same level, supervise and manage the advancement, use and management of decommissioning expenses.

Article 19 (Treatment of Violations) If the responsible unit commits one of the following actions, the local financial department, in conjunction with the relevant competent department at the same level, will deal with it in accordance with relevant regulations:

(1) Failure to advance or amortize retirement expenses in accordance with regulations;

(2) Failing to use the funds for decommissioning expenses in accordance with regulations;

(3) Other acts that violate the provisions of these Measures.

Chapter V Supplementary Provisions

Article 20 (Department of Interpretation) The financial department, price department and ecological environment department of the State Council are responsible for the interpretation of these measures.

Article 21 (Effective Date) These Measures shall come into force on September 1, 2021.

“Interim Measures for the Provision and Management of Decommissioning Expenses for Centralized Disposal of Key Hazardous Waste Facilities and Sites (Draft for Solicitation of Comments)”

In accordance with the Law of the People’s Republic of China on the Prevention and Control of Environmental Pollution by Solid Wastes, the “Accounting Law of the People’s Republic of China” and other laws and regulations, the Provisional Measures for the Provision and Management of Decommissioning Expenses for the Centralized Disposal of Key Hazardous Waste Facilities and Sites (Draft for Solicitation of Comments) (hereinafter Referred to as the “Methods”). The relevant situation is explained as follows.

1. Necessity

Article 88 of the Law of the People’s Republic of China on the Prevention and Control of Environmental Pollution by Solid Waste stipulates that “before the decommissioning of key hazardous waste centralized disposal facilities and sites, the operating unit shall take pollution prevention and control measures on the facilities and sites in accordance with relevant state regulations. The expenses for decommissioning shall be The advance provision is included in the investment budget or production cost, and is specifically used for the decommissioning of key hazardous waste centralized disposal facilities and sites. The specific extraction and management methods shall be prescribed by the financial department and the price department of the State Council in conjunction with the ecological environment department of the State Council.” The method is conducive to effectively preventing and controlling the risk of environmental pollution by hazardous waste, protecting the ecological environment, and safeguarding human health.

Preparation process

Since 2020, the Ministry of Finance, the National Development and Reform Commission, and the Ministry of Ecology and Environment (hereinafter referred to as the three departments) have successively organized local industry authorities, relevant enterprises and experts to conduct several seminars to fully sort out the basic situation of the hazardous waste treatment industry, and advance decommissioning fees The main issues involved were investigated, and relevant enterprises were organized to analyze and calculate the decommissioning expenses, and on this basis, the first draft of the “Measures” was formed. From May to June 2021, the opinions of various provinces (autonomous regions and municipalities) were solicited in writing, and the three departments once again held a special corporate symposium to listen to the opinions and concerns of all parties, absorb rationalized opinions and suggestions, and change their drafts. , The amendments formed the current “Measures” and compilation instructions.

3. Main content

The “Measures” is divided into five chapters and 21 articles, clarifying the pre-provision, use, and supervision requirements of key hazardous waste centralized disposal facilities and sites for decommissioning expenses.

(1) General rules.

This part clarifies the purpose and basis of the formulation of the “Measures”, related definitions, scope of application, main concepts, basic principles, advance and management plans and other requirements. It is clear that the “Measures” are mainly applicable to the advancement, use and management of decommissioning costs for hazardous waste landfills. Responsible units are required to formulate decommissioning expense advance and management plans, and adjust them dynamically according to actual operating conditions.

(2) Expenses accrued.

This part clarifies the treatment mode of decommissioning expenses, and stipulates that the responsible unit should follow the principle of satisfying the stable operation of hazardous waste landfills after decommissioning, and estimate the total decommissioning expenses (abandonment expenses) in accordance with the relevant provisions of the Accounting Standards for Business Enterprises, which shall be included in the original value of relevant assets , In accordance with the relevant provisions of the depreciation of fixed assets, amortized annually, and included in the production cost.

According to the “Hazardous Waste Landfill Pollution Control Standards” (GB18598-2019) and other regulations, after the decommissioning of hazardous waste landfills, enterprises should perform monitoring, maintenance, and pollution control obligations. Based on this, based on the calculations based on the general cost level of the industry, combined with the analysis and calculation results of the surveyed companies, we divided them into flexible landfills and rigid landfills, and formulated the decommissioning cost calculation standard according to the storage capacity.

(3) Expense management and use.

This part clarifies the relevant requirements of the responsible unit in terms of cost management and use, and requires the responsible unit to set up an account, implement special funds in accordance with relevant national laws and regulations, and make up for the decommissioning advance expenses in a timely manner.

(4) Supervision and management.

This part stipulates the ownership management of decommissioning funds, and the decommissioning expense funds drawn by the enterprise belong to the enterprise’s self-use funds. It is stipulated that the local financial department at the same level shall, in conjunction with the relevant competent departments, supervise and manage the advancement, use and management of decommissioning expenses; it also defines the scope of handling violations by the responsible unit.

(5) Supplementary regulations.

This part mainly clarifies the interpretation department and the start time of execution.

Explanation of the problem

(1) Regarding the main targets of the “Measures”.

This approach is mainly applicable to the advancement, use and management of decommissioning expenses for hazardous waste landfills. For other key hazardous waste centralized disposal facilities and sites, relevant local authorities may formulate decommissioning expenses advance, use and management regulations based on the actual conditions of the region.

(2) Regarding the decommissioning fee accrual mode.

According to the current corporate accounting regulations, the decommissioning costs of hazardous waste landfills belong to the category of disposal costs. According to the disposal cost management regulations, the total decommissioning costs should be estimated at one time, included in the original value of the relevant assets, and distributed in accordance with the relevant provisions on the depreciation of fixed assets before decommissioning. Amortized annually and included in production costs. After decommissioning, it is used for the expenses needed by the enterprise to fulfill the decommissioning responsibilities. The decommissioning fee shall be drawn by the enterprise itself and arranged for use in accordance with the regulations. The relevant government departments shall strengthen supervision and management, and shall not set up approval procedures for the use of funds.

(3) Regarding the standards for decommissioning expenses.

According to the “Hazardous Waste Landfill Pollution Control Standards” (GB18598-2019), after the decommissioning of hazardous waste landfills, enterprises should fulfill their obligations of monitoring, maintenance, and pollution control. According to the different types, storage capacity, classification and classification of landfills, the standards are determined. Considering the scale effect, storage capacity distribution, market price level, etc., for flexible landfills, the storage capacity of less than 200,000 m3 (inclusive), 200,000 to 500,000 m3 (inclusive), and more than 500,000 m3 are respectively determined as follows: 200 yuan/m 3 , 150 yuan/m 3 , 100 yuan/m 3 ; for rigid landfills, the total storage capacity is less than 200,000 cubic meters (inclusive) and more than 200,000 cubic meters are respectively determined as 30 yuan/m 3 , 20 yuan/m 3 .

Regarding the convergence of new and old policies.

In order to promote enterprises to assume ecological and environmental protection responsibilities, but also to avoid greater impact on the entire industry, in accordance with the principle of “new and old are different, enterprises can afford”, the completed storage capacity in the landfill will be uniformly discounted in accordance with the current standards. Carry out supplementary withdrawal and amortization (the discount rate is: the ratio of the remaining storage capacity to the total storage capacity). The smaller the remaining storage capacity, the greater the discount, and it can be amortized in no more than five years, which will affect the cost and burden of the enterprise as much as possible Reduced to low; for the newly landfilled storage capacity after the issuance of the “Measures”, the decommissioning fee shall be accrued and amortized in strict accordance with the prescribed standards. The market price transmission mechanism can be used. The additional cost can be used in landfills and hazardous waste generation. Reasonable sharing among enterprises.

(5) Regarding strengthening the supervision of decommissioning fees.

In order to ensure the standardization and management of decommissioning fees, referring to the practice of the mine geological environment governance and restoration fund, the “Measures” stipulates that relevant responsible units establish decommissioning fees fund accounts to specifically reflect the collection and use of decommissioning fees. Considering the opinions generally expressed by enterprises, considering the long-term storage of decommissioning funds of some enterprises, in order to help maintain and increase the value of funds while ensuring that the “Measures” stipulates that enterprises can appropriately carry out value preservation and appreciation investments, but in the two low-risk investments of fixed deposits and the purchase of government bonds. At the same time, it also stipulates that the advancement, use and management of decommissioning fees shall be included in the standardized operation and management of enterprise hazardous wastes.

(6) Regarding the definition of responsibilities.

The regulations clearly stipulate that it is the legal responsibility and obligation of the responsible unit to advance the decommissioning costs of hazardous waste landfills. The decommissioning expenses shall meet the actual needs. If the funds for the decommissioning expenses are insufficient, the responsible unit shall make up for it.

In addition, in view of the interests of enterprises involved, the “Measures” were promulgated. To ensure stability, the “Measures” will be used as a temporary measure. After a period of trial, it will be revised based on actual conditions in the future.

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