Small engine emissions standards – FAQ

Now that the Emissions Standards Regulations have been announced, I thought I would take the opportunity to share some of the questions Industry have been asking. I hope that you can find answers to your questions here, but the door is still open to ask more!

Hi, I just need some info on the new emissions standards for imports: small engines, chainsaws etc. Does the new law affect online sales?
Yes, online sales are treated just the same as store sales. The Environment Department has already planned to work closely with eBay etc. to shut down listings of non-compliant products.
That will still leave a wide loophole: if a business is registered overseas, say in Hong Kong, and the web site is outside Australia, then it is not subject to Australian Laws. The new Emissions Laws are only broken when Fred Smith imports the non-compliant chain saw to use in his garden. Fred is the illegal importer and subject to fines and seizure.
But if Fred only imports one unit, and he doesn’t use a Customs Broker, the Customs System doesn’t record the machine as outdoor power equipment. That means it does not trigger a Community Protection question (is it low emissions compliant?) Because Customs (Australian Border Force) is legally exempt from any role in stopping non-compliant chainsaws, it passes through without a hitch. “Not my problem,” says Customs.
Given that the Community Protection question wasn’t raised at the border, no data was sent the Department of Environment, who have the job of enforcing the law. (The monthly report from Customs is how Environment knows what is imported.) They have no way of knowing what Fred bought, and all the illegal chainsaws bought online from overseas will no doubt slip through the cracks.
There are other gaping loopholes, but this is the one that will hurt the Australian Industry the most.

… also, what is the time we are allowed to resell the items? Regards, -D.
The last import date is 30 June 2018. Industry has a year to sell them to consumers – so the drop-dead date is 30 June 2019. After this date it is illegal to “supply” the non-compliant machines.
Just be aware that “supply” means more than “sell”. It includes advertising, leasing, selling or even giving it away! So, if you are stuck with old, non-compliant product in June 2019, better you give it away that month.

Hi Gary. How’s the reaction to the website on the new EPA registration? And if I have EPA certificate already, do I just upload data to the government website without all the cells filled in with information etc.? And what about the label design, when will that be out?
Not much reaction so far, probably because very few will be using it.
But hang on – are you now manufacturing or assembling engines in Australia? The “EPA” registration you are looking at is only if you need to have your engine certified to the Australian standards, because it is not certified anywhere else in the world.
My understanding is that you import mowers that are already certified to European Standards and carry the correct label? In that case you have no work to do.
If a machine is certified and carries the label for the USA, California (CARB), Canada, or Europe then the importer has nothing to do, though I would strongly advise that you keep on file a copy of the certification approval.
There is no need for an Australian label either – the USA etc. label will suffice.
If you ever become an Australian engine manufacturer, or bring in an uncertified engine and get it certified in Australia, you need to apply via that website. You will also need to add an Australian label. The rules just dictate the information to be on the label – there is no design or logo, it’s up to each manufacturer.
Just to be clear: it is the engine that is certified. So, if you manufacture pumps in Australia, and buy an engine imported by the Australian Distributor, there is nothing you need to do. Easy. If you import the engines yourself, even if there is an Australian Distributor, then you have to do all the same tasks as any importer. That is, pay the levy and keep a copy of the Certification documents.

Does this mean we have no more parts for two strokes? -David
Hi David. First thing to understand is that the law only controls standards for complete engines – stand alone or fitted to a mower etc.
The law does not care about parts. Also, there will still be plenty of two strokes, but only in hand held tools like chainsaws.
There is no restriction at all on the importation of parts. One “smarty” thought he could get around the rules by importing new parts and putting a high emission engine together. That just makes him a “manufacturer” in the eyes of the law and leaves him open to two penalty fines instead of just one. (Manufacturing and supply penalties.)

There is 100 pages of %*$#@ legal words here. Can you just tell me what we need to do?
Let me try to put this in some sort of priority list for you. Starting today and to be complete before June 2018:

Priority #1 is to manage stock levels. You have to flush through the entire distribution chain all of the non-complaint engines by June 2019; every single one.
You may already be buying clean, low emission, quality brand engines, but unless they carry a USA EPA or equivalent certification label they are illegal – or will be soon.
If you are an importer it is vital that the factory understands that from today onwards you only import products with a certification label – the exact same variant as they sell to the USA (or Canada or EU etc.). You need to move to compliant engines now, to get the entire distribution chain flushed through. Think of the slowest selling, smallest retailer and that is the target – to get all his stock compliant.
While you are telling the factory all of this, better ask for copies of the Compliance Certificates. Better yet, go visit the guy who handles all the Certification process and take him to dinner – he is your new best mate. Get him on side because you are going to need this guy to send you a certificate every time they make an update.
If you are a local manufacturer, get a clear undertaking, in writing, from your engine supplier that they will supply certified engines only, by a certain date. You need to work out that date based on your slowest distribution channel. If some retailers keep stock for up to a year, you need to move to compliant engines by April 2018, I’d suggest.

Priority #2 is Budgeting.
If you are an importer you are going to be slugged with a levy of 0.5 per cent of import value for anything imported after 1 July. You need to build that into your 2018 budgets.
You won’t see the first invoice for a year – maybe in August 2019, so don’t get caught out. Hold aside reserves to pay this Levy in November each year. Make sure your Accountant is on top of this right now.
If you are a manufacturer or retailer, expect to see slight price increases. Not only does your importer have a levy to pay, but I have heard that most factories charge a few dollars more for the certified variant of the same engine, complete with label.

Priority #3 is Education
If you are an importer then your Customs Broker, or internal team, need to be on top of this.
What seems to be most important is getting the Harmonized Customs Codes all correct. The levy is going to be charged and you don’t want to pay a levy on say, spare blades for mowers that were incorrectly coded. That is going to be tough to sort out when the invoice arrives in August 2019, so get it all straightened out now.
I heard that the Department plans to deliver some training or advice for Customs Brokers, but don’t rely on this to be early enough or detailed enough. Get a review or audit of coding starting today and be all fixed before June this year.

Priority #4 is “Road test now”
This one is for importers and manufacturers. Until recently, most of the nice clean engines imported into Australia have been the International variant. It is likely that the identical looking variant with the USA EPA certification is tuned a little differently. What that means in practice I don’t know, and neither do you until you get your hands on one and put it through its paces in Australia, in your machines and with Australian petrol and weather.
Personally, I’d be pushing to get my hands on a certified sample engine urgently. If that means paying extra to get it airfreighted in, then so be it. It is cheap insurance to sort out any bugs now, while you have time. The alternative is to risk having to cease production to sort out any problems come July, when only US spec engines will be supplied.

Got any questions? Please ask. Your questions will help me as much as you.

At this late stage, Gary has been helping companies, joining email conversations with overseas offices and holding teleconferences to help companies sort through the details. This is a free service to readers, who can contact him via PEA Editor, Elaine Sharman, at elaine.sharman@nullglenv.com.au

GARY FOOKS
Gary Fooks is Chair of the Blue Sky Alliance: a collaboration between the OPEA and the marine engine sector. Gary has been working on small engine emissions standards since 2005 and was announced as the Environment Minister’s Clean Air Champion in 2015.