Posted on 08/11/2008 in category Legislation




Brussels,7 November 2008

BIRofficially calls upon EU Commission

tobring contract breaches to a halt

Today,the Bureau of International Recycling has sent an official letter toEU Commissioners Günter Verheugen (Enterprise and Industry) andCatherine Ashton (Trade) to express serious concern regarding thecommercial behaviour of many buyers of secondary raw materials in theEU and in other countries worldwide.

Asa result of the current financial and economic turmoil that isaffecting all sectors including the production and manufacturingindustries, many buyers of secondary raw materials are failing to payfor shipments, renege on open contracts or seek extraordinarydiscounts from the contracted price for materials even after thegoods have reached the ports in the country of destination.

As only one of manyexamples, BIRinformed the Commission that a major European steelmaker with amarket share of 34% in Europe recently sent a letter to all itssuppliers where he announced that “because of the current situationon the steel market and of the subsequent of the scrap consumption,we are sorry that we have to immediately renege on all contractswhich were concluded before the month of September and for which thematerials have not been delivered yet”. It must be stressed thatthis steelmaker also just announced a record profit for the thirdquarter of 2008.

AlthoughBIR members understand that the current market situation can lead toa reduction of demand for steel, paper, metals etc., they want tovigorously denounce the current practices of some buyers, which areunfair and unethical and which endanger the functioning of the wholeEuropean recycling industry.

BIRhas asked for an official response of the competent directorateswithin the EU Commission and intends to discuss the matter at worldlevel within the World Trade Organisation.


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