Resources, Conservation & Recycling 161 (2020) 104920

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Resources, Conservation & Recycling

journal homepage: www.elsevier.com/locate/resconrec

Review

Transitioning China to a circular economy through remanufacturing: A T

comprehensive review of the management institutions and policy system
⁎
Xueliang Yuana, , Mengyue Liua, Qian Yuanb, Xiaohan Fana, Yuqiang Tenga, Junhua Fuc,
Qiao Maa, Qingsong Wanga, Jian Zuod
a
National Engineering Laboratory for Reducing Emissions from Coal Combustion, School of Energy and Power Engineering, Shandong University, Jinan 250061, China
b
Shandong University Press, Jinan 250100, China
c
Jinan Ecology and Environment Monitoring Center of Shandong Province, Jinan 250101, China
d
School of Architecture & Built Environment, The University of Adelaide, SA 5005, Australia

A R T I C LE I N FO A B S T R A C T

Keywords: As an advanced form of green economic development, remanufacturing is gaining attention because of its sig-
Remanufacturing nificant environmental, economic and social benefits. Many countries have formulated relevant policies to
Circular economy support the development of remanufacturing industry for a more sustainable society. As a strategic emerging
Management institution industry, China's remanufacturing industry has made rapid progress driven by government policies in recent
Policy
years. This research critically analyzes the management institutions and policy system for the development of
remanufacturing industry in China. China's remanufacturing policy system, including one National Law, one
Regulation of the State Council, 166 Documents of the State Council and the Ministries and Commissions, is
comprehensively reviewed. These policies reflect current issues and set future directions for remanufacturing in
China through comparison with the policy of the U.S., Europe and Japan. Suggestions for further improvements
are made accordingly. These include: defining clear and specific responsibility of management institutions,
modifying the legal and standards system, launching tax incentives for remanufactured products, establishing a
standardized reverse logistics system, strengthening the publicity and promotion of remanufactured products, as
well as enhancing consumer awareness. This research comprehensively depicts the overall picture of re-
manufacturing industry in China from the policy and institutional perspective. These findings are useful for the
development of remanufacturing in other industrializing countries.

1. Introduction
As an effective way to develop the circular economy and achieve
sustainable development, remanufacturing has attracted worldwide
attention due to its significant environmental, economic and social
benefits (Hatcher et al., 2011; Zhao et al., 2019). Remanufacturing is
defined as "an industrial process in which worn out products are re-
stored to like new condition" (Lund, 1984). It typically includes dis-
assembly, cleaning, repair, reassembly, and testing (Sherwood et al.,
2000). The primary purpose of remanufacturing is to recover the re-
sidual value of components and materials from used products
(Debo et al., 2005; Van Wassenhove, 2009). Compared with new pro-
ducts, remanufactured products can save cost, energy and material
(Zhao et al., 2019), which is equivalent to the global energy saving of
16 million barrels of crude oil annually (Sundin and Lee, 2012). If all its
automotive engines could be fully remanufactured, China could save 6-
9.4 billion kWh electricity and reduce 6.67-9.69 million tons of CO2
emissions per year on average (Xia et al., 2015).
Many countries have implemented relevant policies to support the
development of the remanufacturing industry. The U.S. government
enacted The Federal Vehicle Repair Cost Savings Act in 2015, which is a
landmark event for the entire industry (USA Government, 2015). The
Act requires federal agencies to encourage the use of remanufactured
parts in federal vehicle repairs. Some European countries have laun-
ched a strategy of revitalizing manufacturing industry to accelerate the
transformation of the manufacturing industry and the development of
the remanufacturing industry through the integration of information
technology and production system. Examples include the New Face of
Industry in France (France Government, 2014), the German Industry
4.0 Plan (German Federal Government, 2017), the U.K. has developed
an Industry 2050 Strategy (UK Government, 2013). Japan has the most
complete legislative system to promote the circular economy. Three

⁎
Corresponding author. Tel./fax: +86 531 88395877
E-mail address: yuanxl@sdu.edu.cn (X. Yuan).

https://doi.org/10.1016/j.resconrec.2020.104920
Received 10 November 2019; Received in revised form 27 April 2020; Accepted 3 May 2020
0921-3449/ © 2020 Elsevier B.V. All rights reserved.
X. Yuan, et al.
levels of policy include basic laws, comprehensive laws and special
regeneration laws. Eight comprehensive and specific regeneration laws
have been enacted, which define the respective responsibilities and
obligations of the government and business enterprises (CPRA, 2018).
As the leaders in remanufacturing, the U.S., Europe, and Japan may be
viewed as having relatively well developed institutional and policy
systems which include the recycling of end-of life components to the
producer responsibility extension system.
As a strategic emerging industry, China's remanufacturing industry
has made steady progress under the guidance of policies in recent years.
A series of policies particularly dedicated to the promotion of re-
manufacturing provide legal and institutional guarantees. This study
makes an attempt to present a comprehensive review of the manage-
ment institutions and policy system for remanufacturing in China.
The paper is organized as follows. Section 2 offers a specific over-
view of global background on remanufacturing and literature review to
explore researches related to this paper, and point out research gap and
research objectives. Research methodology is presented in Section 3.
Section 4 is the detailed review on management institutions for re-
manufacturing. Section 5 analyzes China's 168 remanufacturing po-
licies in a top-down manner. Section 6 provides discussion and sug-
gestions for further improvements, and the study is summarized in
Section 7 by offering conclusions.
2. Background and literature review
2.1. Background
2.1.1. International Progress in Remanufacturing
Remanufacturing has a history going back more than 100 years and
has now evolved into a complete industrial system with technical
standards, processing technology, and processing equipment to reverse
logistics (Zhang et al., 2011). Automobile components remanufacturing
is currently the largest remanufacturing industry across the world
(Kamper et al., 2019). It primarily includes engines, transmissions,
starters, compressors, alternators (Wahab et al., 2018), turbocharger
and clutches (Govindan et al., 2016). The automobile components re-
manufacturing market, which accounts for two-thirds of re-
manufacturing businesses globally (Matsumoto and Umeda, 2011), is
predicted to reach US$122.8 billion by 2018 (Yusop et al., 2016), and
US$198 billion by 2024 (Global Industry Analysts, 2017). Fig. 1 and
Fig. 2 show the market share of remanufactured automotive after-
market by global region in 2015 and 2022 respectively (APRA, 2016).
North America will continue to dominate the global remanufacturing
market in the coming years, although its market share of auto
Fig. 1. Remanufactured Automotive Aftermarket: Market Share by Region, 2015.
2
Resources, Conservation & Recycling 161 (2020) 104920
remanufacturing has decreased. Europe accounts for the second largest
proportion of the global remanufacturing market, with its market share
increasing slightly by 2022, when it is expected to reach 33%. China's
automobile remanufacturing market share has increased, with its total
revenue double to 9% by 2022 compared with 2015.
The U.S. is the largest remanufacturer in the world (Sharma et al.,
2016). Remanufacturing is mainly concentrated in products which are
materially intensive and durable, that is, products with a long-life cycle
(USITC, 2012). From 2009 to 2011, the U.S. remanufacturing industry
created enormous economic value, with total growth of 15% reaching
US$43 billion (USITC, 2012; Steeneck et al., 2014). The number of
people employed in remanufacturing was approximately 180 thousand
in 2012 (Zlamparet et al., 2017). The U.S. remanufacturing market is
about $53 billion per year currently (Gao and Wang, 2017), with nearly
70% of sales in the auto sector (Zhang et al., 2017). In order to promote
the development of remanufacturing, many companies carry out pro-
duct recycling programs and provide subsidies to consumers who pro-
vide used products (Wu and Wu, 2016; Ben-Daya et al., 2019).
Remanufacturing industry in Europe has a total turnover of almost
30 billion euros (Parker et al., 2015). The economic benefits of the
circular economy industry will reach $1.8 trillion by 2030 in EU
(Diener et al.,2019), amongst which the annual value of the re-
manufacturing industry is expected to reach 70-100 billion euros, em-
ploying between 450 and 600 thousand workers (Zhang et al., 2018).
The End-of-Life Vehicles (ELV) and Waste Electrical and Electronic
Equipment (WEEE) Directive were enacted by EU to promote the re-
cycling of key components and strengthen the extension of producer
responsibility (Gerrard and Kandlikar, 2007). These directives set a
minimum recovery rate, and force manufacturers to engage in product
recovery activities (Charte and Gray, 2008). According to data from the
Automobile Parts Remanufacturers Association, about 50% of raw
materials in Europe are recycled and involved in remanufacturing
businesses (APRA, 2013).
The remanufacturing industry in Japan is leading the way in copiers
and cameras, while automobile components remanufacturing is rela-
tively backward (Matsumoto and Umeda, 2011). Among the re-
manufactured engineering machineries in Japan, 58% are used by do-
mestic users, 34% are exported abroad, and the remaining 8% are
dismantled and sold as accessories (CPRA, 2018).
With rapid development of remanufacturing all over the world, a
number of emerging remanufacturing technologies have begun to
flourish. The cleaning of remanufactured products lays a good foun-
dation for subsequent procedure of repair, assembly and testing.
Remanufacturing cleaning technologies include advanced methods
such as supercritical CO2 cleaning and liquid blasting, as well as
X. Yuan, et al.
Fig. 2. Remanufactured Automotive Aftermarket: Predicted Market Share by Region, 2022.
conventional approaches such as high temperature decomposition and
shot blasting. Peng et al. (2016) compared these two types of cleaning
technology using life cycle assessment, and found that the environ-
mental impact of traditional cleaning technology was 10 times that of
advanced methods. Part-repair technology, including cold spraying,
thermal spraying, arc spraying, laser cladding, brush electroplating and
electro-sparking, plays a key role in the remanufacturing process to
restore worn out or damaged products to their original design dimen-
sions or to improve their performance (Wang et al., 2002).
Liu et al. (2017) outlined the impact of in-situ monitoring and adaptive
control (IMAC) technology on laser cladding remanufacturing, and
explained that IMCA could effectively improve the quality and repeat-
ability of laser cladding layers to meet the quality standard of high-
value components. Based on LCA methodology, Zheng et al. (2019)
explored the environmental benefits of three different engine products,
i.e. remanufacturing with advanced restoration technologies, re-
manufacturing without advanced restoration technologies and new
products. The results showed that the remanufactured engine with
advanced restoration technologies had the greatest environmental
benefits and could reduce 253kg CO2 emissions and 3170MJ of energy
consumption.
China
The United States
Japan
Germany
South Korea
India
Italy
France
The United Kingdom
Brazil
0 0.5 1 1.5
Fig. 3. Top 10 global manufacturing value added in 2017. Source: IBRD, 2019
3
Resources, Conservation & Recycling 161 (2020) 104920
2.1.2. Remanufacturing in China
China ranks number one in the world in respect of added value from
manufacturing, as shown in Fig. 3. China is the world leader in the
production of more than 220 kinds of electromechanical products. The
machine tool, engineering machinery and automobile account for 38%,
30% and 25% of the global share respectively (Liu, 2016). Manu-
facturing has made an enormous contribution to promote the growth of
GDP in China. In 2017, manufacturing added value reached 24.27
trillion RMB, which accounted for 29.34% of GDP (NBS, 2019). Fig. 4
shows the value added and growth rate of China's manufacturing in-
dustry from 2000 to 2017. It can be seen that while the added value of
manufacturing has continued to increase, the growth rate has gradually
slowed down in recent years.
China has entered the peak period of electromechanical products
obsolescence. The trend of the number of scrapped electromechanical
products in China is shown in Fig. 5. The growing number of these
scrapped products may cause significant negative impact to the en-
vironment (Xiao et al., 2018). China became the world's largest auto-
mobile producer and consumer in 2009 (NPCSC, 2009). By the end of
2018, China's civil automobile ownership was 240 million. The number
of End-of-Life Vehicles (ELVs) was 9.1 million, while only 1.99 million
ELVs were recycled, a recycling rate of just 22% (CII, 2019). It is esti-
mated that the total number of ELVs in China will exceed 10 million by
2 2.5 3 3.5 4
Trillion USD
X. Yuan, et al. Resources, Conservation & Recycling 161 (2020) 104920

Fig. 4. The manufacturing value added and growth rate in China from 2000 to 2017. Source: NBS, 2018

2020 (CII, 2016). Fig. 6 shows the scrapping and recycling rates of
China's auto market in 2011-2018. The figure indicates that China's
ELVs recycling rate is quite low, only 30%, which has implications for
resource loss, environmental impact, and safety. As a major producer
and consumer of global manufacturing, there is strong case for China to
focus on and progress remanufacturing.
Since the early 1990s, the remanufacturing industry in China has
experienced three stages, i.e. industrial initiation, scientific research,
and government advancement (Xu, 2010). The government's efforts
have led to a comprehensive set of policies that guide the development
of remanufacturing (Li, 2015). The scope of the remanufacturing in-
dustry covers automotive, engineering machinery, electric motors,
mining machinery, petroleum machinery, internal combustion engines
as well as their components. Remanufacturing is developing rapidly in
China and is expected to exceed 200 billion RMB by 2020
(MIIT, 2016b).
2.2. Literature Review
2.2.1. Current Studies on Remanufacturing
Remanufacturing industry is a popular research topic among re-
searchers and practitioners (Govindan et al., 2016). Existing studies on
remanufacturing cover key technologies, marketing strategies, after-
market services, key factors for remanufacturing development, eva-
luation of remanufacturing and policy development. Global develop-
ment trend of remanufacturing industry was analyzed by some
researchers. Matsumoto et al. (2016) outlined the trends and drivers/
barriers of remanufacturing and presented reviews in research and
development that will help overcoming the barriers. Lee et al. (2017)
undertook a literature review on trends and issues related to the re-
manufacturing from 2012 to 2017, and summarized the global re-
manufacturing landscape in the major remanufacturing countries.
Kang et al. (2018) reviewed the latest trend of Korea's remanufacturing
industry in order to refine the understandings on the current status of
the remanufacturing industry.
Some researchers paid more attention to key technologies of re-
manufacturing industry. Priyono et al. (2016) identified factors that

45
40
35
30
Million

25
20
15
10
5
0
2009 2010 2011 2012 2013 2014 2015 2016 2017
Year

Television Refrigerator Washing Machine

Air Conditioning Microcomputer
Fig. 5. The number of scrapped electromechanical products in China. Source: CII, 2018

4
X. Yuan, et al. Resources, Conservation & Recycling 161 (2020) 104920

7 35
6 30
5 25

Million
4 20

%
3 15
2 10
1 5
0 0
2011 2012 2013 2014 2015 2016 2017 2018
Year

Quantity of ELVs Quantity of ELVs recovered

Scrap rate Recovery rate
Fig. 6. Chinese ELVs from 2011 to 2018. Source: CII, 2019

●● Macro
Macro management
management institution
t tion for
institu f r remanufacturing
fo remanufa f ctu
t ring
●● The
The management
management agencyagency of
of remanufacturing
remanufa f ctu
t ring ●● Formulate
Formulate and
and organize
organize medium
medium and and long-term
long-term
●● Organize
Organize the
the demonstration
demonstration project
o ect of
proj of remanufacturing
remanufa
f ctu
t ring development
development plans
plans for
f r the
fo the remanufacturing
remanufa f ctu
t ring
of
of electromechanical
electromechanical products
produ
d cts ●● Organize
Organize the
the pilot
pilot work
work of of auto
auto parts
parts remanufacturing
remanufaf ctu
t ring
●● Carry
r out
Carry out the
the identification
f cation of
identifi of remanufactured
remanufa t red products
f ctu produ
d cts ●● Guide
Guide banking
banking financial
f nancial institutions
fi t tions to
institu to increase
increase their
their
●● Push
Push industrial
d strial transformation
indu f rmation and
transfo and upgrading
u grading
up support
u port for
sup f r remanufacturing
fo remanufa f ctu
t ring

●● Formulate
Formulate national
national standards
standards for
f r remanufacturing
fo remanufaf ctu
t ring
●● In
In charge
charge of
of the
the quality
quality and
and safety
f ty supervision
safe u ervision and
sup and
management
management of of remanufactured
remanufa t red products
f ctu produ
d cts
MIIT
MIIT NDRC
NDRC

●● Formulate
Formulate financial
f nancial subsidies
fi u sidies for
sub f r remanufacturing
fo remanufa f ctu
t ring Government
Government Agencies
Agencies andand
●● Regulate
Regulate the
the management
management ofof subsidies
u sidies for
sub f r purchasers
fo purchasers MOF
MOF Responsibilities
Responsibilities for
f r
fo SAMR
SAMR SAC
SAC
●● Provide
Provide necessary
necessaryr financial
f nancial support
fi u port for
sup f r circular
fo circular Remanufacturing
Remanufa
f cturing
economy
economy demonstration
demonstration

MOST
MOST MOFC
MOFC MEE
MEE

●● Guide
Guide remanufacturing
remanufa t ring technology
f ctu technology research
research ●● Formulate
Formulate the the domestic
domestic market
market development
development
planning
planning strategy
strategy for
f r remanufacturing
fo remanufa f ctu
t ring ●● Guide
Guide the
the development
development of of eco-environmental
eco-environmental industry
indu
d stry
r
●● Guide
Guide the
the breakthroughs
breakthroughs in in basic
basic theoryr of
theory of ●● Draft
Draftf the
the management
management measures
measures for
f r import
fo import and
and ●● Propose
Propose the
the scale
scale and
and direction
direction of
of fixed
f xed asset
fi asset
remanufacturing
remanufaf ctu
t ring export
export ofof machinery
machinery r and
and electronic
electronic products
produ
d cts investment
investment in
in the
the ecological
ecological environment
environment
●● Advance technological innovation
Advance technological innovation in key in key ●● Promote energy conservation and emission
Promote energy conservation and emission ●● Propose
Propose the
the state's
state's financial
f nancial funding
fi f nding arrangements
fu arrangements
technologies
technologies for
f r remanufacturing
fo remanufa f ctu
t ring reduction
d ction in
redu in service
service industry
indu
d stry
r

Fig. 7. The government control of remanufacturing in China.

affect disassembly for remanufacturing, and proposed a new dis- the recent research development and outline possible further research
assembly model. Yan et al. (2018) provided a review of ultrasonic in Core Acquisition Management. Zlamparet et al. (2017) evaluated the
testing for stress in remanufacturing laser cladding coating, and sum- situation of waste electrical and electronic equipment remanufacturing
marized the recent research outcomes on ultrasonic testing for stress. between China and remanufacturing companies from Europe.
Liu et al. (2019) focused on the status of remanufacturing assembly on Fadeyi et al. (2017) examined the integration of product service sys-
the basis of studying the characteristics of remanufacturing assembly tems and remanufacturing, and identified product serviceability and
system. Wahab and Azman (2019) provided an overview of the prin- core cleaning are critical for the success of both product service systems
ciples and capabilities offered by the existing metal additive manu- and remanufacturing.
facturing technology for remanufactured object repair and restoration. Business decision strategies for remanufacturer selection are also
Kerin and Pham (2019) reviewed the literature on the emerging digital explored by some researchers. Subramoniam et al. (2009) provided
technologies of Industry 4.0 that focused on the applicability of the guidance on remanufacturing for automotive industry aftermarket
Internet of Things, Virtual Reality and Augmented Reality in re- based on the literature review related to reverse logistics. Kumar and
manufacturing. They suggested there is a need to explore the connec- Ramachandran (2016) pointed out the key factors that firms need to
tion of cyber-physical systems to IoT to support smart remanufacturing. consider as they assimilate remanufacturing in their operations and
The service model of the remanufacturing industry is another pop- revenue management strategy. Govindan et al. (2019) presented the
ular topic. Wei et al. (2015) analyzed the quantitative mo tdeling in opportunities to improve marketing approaches for remanufactured
Core Acquisition Management research area, with an aim to summarize products through exploring various marketing strategies, consumer

5
X. Yuan, et al.
behaviours, pricing and branding decisions, and optimized green
transportation. Sitcharangsie et al. (2019) provided useful insights into
how remanufacturing outcomes can be optimized involving multiple
decision factors across multiple remanufacturing activities. Further-
more, other aspects have been examined such as: remanufacturing
production planning (Rafiei et al., 2015), design for remanufacture
(Hatcher et al., 2011; Wahab et al., 2018) and evaluation issues
(Goodall et al., 2014; Peters, 2016; Zhang et al., 2020).
Government policies are considered to possess a notable influence
on the remanufacturing, and have the maximum number of relation-
ships with other factors that impact the remanufacturing industry
(Singhal et al., 2020). Therefore, the relationship between re-
manufacturing and policy development deserves closer attention.
Mitra and Webster (2008) examined the effects of government subsidies
by a two-period game theory model. They found that the introduction
of subsidies could increase remanufacturing activity. Wang and
Chen (2011) discussed the implementation of extended producer re-
sponsibility in China's automobile remanufacturing industry and pro-
posed perspectives to improve these policies. Wang and Chen (2013)
classified the policies and regulations about China's ELVs recycling in-
dustry and indicated that an appropriate old-for-new subsidy standard
could motivate vehicle owners to return ELVs. Wang et al. (2014) ex-
plored the impact of four subsidy policies, i.e. initial subsidy, recycling
subsidy, R&D subsidy and production subsidy, and mixed-subsidy po-
licies on the development of the remanufacturing industry in China
using system dynamics. Their results showed that incentive objectives
and characteristics varied significantly according to subsidies.
2.2.2. Research Gap and Research Objectives
The previous reviews have focused on issues such as key technolo-
gies or progression of remanufacturing, the service models and the
business decision strategies. However, there is lack of studies on the
remanufacturing policy development at both the macro policy system
level and the detailed policy item level. Meanwhile, the existing re-
search on remanufacturing policy is limited to a specific field or a
certain type of remanufacturing products. The remanufacturing in-
dustry is a complex system which involves various fields of social
economy. As a result, its development is not driven by a single policy
but the result of a combination of multiple policies. It is necessary to
conduct a comprehensive and systematic review of the entire policy
system. In addition, the developing countries can learn from the im-
plementation experience of remanufacturing policies in developed
countries like the U.S., Japan and European countries, which have
successful practice in remanufacturing industry. Furthermore, re-
manufacturing industry has developed rapidly and is planned for even
more ambitious development in future in China. The continuous for-
mulation of the related policies has made China a good sample for the
research of remanufacturing policy. This paper systematically analyzes
the management institutions and policy system for the remanufacturing
industry in China. By comparing with policies of the U.S., Europe, and
Japan, the challenges of current policy system in China are identified.
China's experience and practices will provide useful references to the
development of remanufacturing in other developing countries.
3. Methodology
This research builds on a systematic review of the management
institutions and policy system for remanufacturing development in
China. We assess its deficiencies using comparison with the policies of
other countries in order to investigate China's efforts for transitioning to
a circular economy through remanufacturing.
The institutional system for remanufacturing includes the State
Council and the ministries and commissions under the State Council, 31
governmental agencies in total. The review of these government
agencies will examine the administration system for remanufacturing
and the potentials that need to be further improved.
6
Resources, Conservation & Recycling 161 (2020) 104920
The policy system includes national law, regulation of the State
Council, and documents of State Council, Ministries and Commissions.
The policies were collected in two steps. The first step was an extensive
search on the official websites of the 31 governmental agencies. In the
second, we looked for additional policies being cited by the policies
already found, until no new policy could be obtained.
The keywords used for searching policies and literatures included
remanufacturing, circular economy, comprehensive utilization of re-
sources, trading old for remanufactured product, producer responsi-
bility extension system.
The data applied for analysis came from International Bank for
Reconstruction and Development, Automotive Parts Remanufacturers
Association, Global Industry Analysts, China National Bureau of
Statistics, China Industry Information, the Remanufacture Committee of
China Association of Automobile Manufactures and the websites of the
governmental agencies.
Since the first national policy related to remanufacturing in China
was issued in June 2005, the time span of this research is from June
2005 to June 2019.
4. Government agencies for remanufacturing
Remanufacturing is the responsibility of several government agen-
cies in China since it covers a range across a wide activity. The main
government agencies responsible for remanufacturing include the
National Development and Reform Commission (NDRC), the Ministry of
Industry and Information Technology (MIIT), Ministry of Finance
(MOF), the Ministry of Science and Technology (MOST), the State
Administration for Market Regulation (SAMR), the Ministry of
Commerce (MOFC) and the Ministry of Ecological Environment (MEE).
These government agencies coordinate with one another and are re-
sponsible for supervision and management of remanufacturing within
their respective areas with the aim of jointly promoting the develop-
ment of the remanufacturing industry.
The NDRC is a macro management institution for remanufacturing,
which formulates and organizes medium and long-term development
plans for the remanufacturing industry. This institution coordinates and
guides the pilot work of automobile component remanufacturing, and
organizes the implementation of "trading old for remanufactured pro-
duct". In addition, the NDRC enacts and implements plans and policies
for green development, advances the strategy of achieving sustainable
development, and undertakes environmental protection and other re-
lated work. In addition, the institution takes the responsibility of pro-
posing policy measures to guide banking financial institutions to in-
crease their support for the remanufacturing industry (NDRC, 2019).
The MIIT is responsible for the management of remanufacturing. It
is responsible for organizing and coordinating the demonstration pro-
ject of remanufacturing of electromechanical products, the popular-
ization and application of remanufactured products. The MIIT carries
out the identification and announces catalogues of remanufactured
products. On the other hand, the department establishes industrial
energy conservation and green development plans, pushes industrial
transformation and upgrading, and achieves green manufacturing
(NPCSC, 2018b).
The MOF formulates financial subsidies for remanufacturing, reg-
ulating and strengthening the management of subsidies for purchasers.
Apart from providing fiscal tax incentives for remanufactured products
listed in the catalogue issued by the MIIT, the MOF also supports the
pilot work of circular economy and provides necessary financial sup-
port (NPCSC, 2019a).
The MOST undertakes the construction of a scientific and techno-
logical innovation system to promoting remanufacturing, and is re-
sponsible for the coordination, evaluation and management of funds for
the related science and technology projects. The MOST also draws up
research plans, policies and standards for key technologies of re-
manufacturing, and guides and advances breakthroughs in basic theory
X. Yuan, et al.
and technological innovation in key technologies of remanufacturing
(MOST, 2018).
The SAMR takes charge of the quality and safety supervision and
management of remanufactured products, as well as the formulation
and revision of national standards for remanufacturing. The national
standards for remanufacturing are jointly issued by the SAMR and the
Standardization Administration of China (SAC) (NPCSC, 2018a).
The MOFC takes the lead for trade, formulates domestic market
development strategy for remanufacturing and drafts the management
measures for import and export of electromechanical products. In ad-
dition, the MOFC promotes energy conservation and emission reduction
in service industry, guides the development of logistic industry of the
production materials, and formulates relevant plans and policies
(MOFC, 2019).
The MEE, in conjunction with other relevant agencies, is responsible
for formulation and implementation of eco-environment policies and
plans, and participates in guiding and promoting the development of
green manufacturing, circular economy and eco-environmental pro-
tection industry to reduce the environmental impact of industrial de-
velopment. The MEE is also responsible for the fixed asset investment in
the ecological environment field and the related financial funding ar-
rangements (MEE, 2019).
The management institutions of government departments and the
corresponding responsibilities is shown as Figure 7.
5. Remanufacturing policy
The policy system is organized in a top-down manner (see Fig. 8).
On the top is the overarching law approved by the Standing Committee
of the National People's Congress and issued in the form of the Pre-
sidential Order. In the middle is the regulation approved by the State
Council and issued in the form of State Council Decree, and on the
bottom are the documents of the State Council, Ministries and Com-
missions.
With a comprehensive review of China's remanufacturing policy
system, we collected 168 remanufacturing policies including one
National Law, one Regulation of the State Council and 166 Documents
of the State Council, Ministries and Commissions. All these policies are
at the state-level. Fig. 9 shows the number of remanufacturing policies
issued in China from 2005 to 2019.
Since 2010, there have been increasingly more efforts leading to-
ward a comprehensive policy framework, as reflected in a few aspects.
First, the number of policies issued has increased, and policies were
more frequently made or updated. For instance, the number of re-
manufacturing policies has almost tripled in 2012. This is the follow-up
response to the crucial guiding documents, i.e. Proposal on Promoting
● Approved by the standing
Committee of the National
People’ s Congress
● Issued in the form of the National
Presidential Order Laws
● Approved by the State
Council Regulations of
● Issued in the form of
State Council Decree
the State Council
● Approved and
issued by the
ministries of the
Documents of the State Council,
State Council Ministries and Commissions
Fig. 8. The policy system of remanufacturing in China.
7
Resources, Conservation & Recycling 161 (2020) 104920
the Development of Remanufacturing Industry issued in 2010 and the
12th Five-Year Plan for National Economic and Social Development is-
sued in 2011. Both documents clearly defined "Remanufacturing in-
dustrialization" as one of the key projects of circular economy. Second,
the content of the policies is more comprehensive. The scope of re-
manufactured products is gradually increasing, covering a stepwise
expansion of product categories. Third, "trading old for remanufactured
product" has been consistently promoted, which has ensured the source
and quantity of discarded products and enlarged the market share of
remanufactured products.
5.1. National Law
Remanufacturing is the final step in the circular economy model of
“resource-product-waste product-remanufactured product”. In order to
promote the development of the circular economy, improve the effi-
ciency of resource utilization and move towards sustainable develop-
ment, China enacted the Circular Economy Promotion Law in August
2008, which was officially implemented on January 1, 2009. It is the
only national law in the field of remanufacturing in China and re-
presents a milestone in the development of the remanufacturing in-
dustry. The Law elaborates on remanufacturing in Articles 2, 40 and 56.
The main contents are shown in Table 1. The Circular Economy Pro-
motion Law clearly states the legal status, meaning and scope of re-
manufacturing, and controls remanufacturing in respect of product
quality and labelling; it forms the legal basis of the remanufacturing
industry in China.
5.2. Regulation of the State Council
Regulations of the State Council can be used to implement legisla-
tion and carry the force of Law in the implementation process. At
present, there is only one regulation of the State Council related to
remanufacturing in China, namely Measures for the Management of
End-of-Life Vehicles Recycling promulgated by the State Council in
June 2019 (see Table 2). The regulation breaks the legal obstacles to
mandatory obsolescence of the “five major car parts” of ELVs, i.e. en-
gine, steering gear, transmission, front and rear axle. On the contrary, it
encourages the remanufacturing of the “five major car parts”. The value
of ELVs and the comprehensive utilization rate of resources are im-
proved significantly.
5.3. Documents of the State Council, Ministries and Commissions
5.3.1. Plans, guidelines and programs
The plans, guidelines and programs related to remanufacturing
● Circular Economy Promotion Law
● Measures for the Management of
End-of-Life Vehicle Recycling
● The plans, guidelines and programs related
to remanufacturing
● Implementation proposals and notices on
remanufacturing
● Remanufacturing pilot projects
● ...
X. Yuan, et al. Resources, Conservation & Recycling 161 (2020) 104920

35

30 29
27

Number of policies issued

25
22

20

15 13
12
10
10 9 9 9
7
6
5
5 4
3 3

0
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Year
Fig. 9. The number of remanufacturing policies issued in China.

reflect the current focus and future policy direction. Compared with By 2020, the output value of the recycling industry for regenerated
national laws and regulations of the State Council, these plans, guide- resources and remanufacturing industry is expected to reach 1.5 trillion
lines and programs have more specific contents with time effectiveness. RMB and 200 billion RMB, respectively.
Up to now, government agencies have issued 62 plans, guidelines and
programs related to remanufacturing in China. The main policies are
5.3.2. Implementation proposals and notices
listed in Table 3. These documents clarify the goals and plans of China's
The CSC, MIIT, NDRC and other agencies have issued 28 im-
strong support for the development of the remanufacturing industry,
plementation proposals and notices on remanufacturing. These im-
and reflect the trend of the remanufacturing in the period of 2005-
plementation proposals and notices specify the overarching develop-
2020.
ment goals and priorities of China's remanufacturing industry in the
The scope of these documents has been expanded from the re-
future. Table 4 lists five of these documents.
manufacturing of traditional electromechanical products (e.g. auto-
These documents guide the whole state to accelerate the develop-
mobile components, engineering machinery, and machine tools) to high
ment of the remanufacturing industry and cultivate the re-
value-added key components (e.g. shield tunnel machines, aero en-
manufacturing industry as a new economic growth point. The key areas
gines, gas turbines, and medical imaging equipment). These documents
in remanufacturing development in China are also specified, especially
have focused on,
the requirements to strengthen technological innovation. The relevant
government agencies should develop policies, which could enhance the
• strengthening technical and equipment research for non-destructive life cycle management level of products through research and devel-
testing, green and efficient cleaning, automated surface and volume
opment (R&D), manufacturing, procurement, distribution, after-sales
repair, and accelerating application at the industrial scale;
service, recycling and remanufacturing. It is clearly specified in these
• organizing the implementation of "trading old for remanufactured
documents that the remanufacturing service industry should be culti-
product";
vated, and the construction of remanufacturing demonstration bases
• promoting the recycling of "Internet Plus" resources, and estab-
should be accelerated to promote its development.
lishing a reverse intelligent logistics recycling system;
• implementing the producer responsibility extension system to ac-
5.3.3. Remanufacturing pilot projects
celerate the transformation of manufacturing industry from pro-
duction-oriented to service-oriented; A total of 14 policies have been issued so far. The relevant policies
• promoting the certification of remanufactured products, and are listed in Table 5. Remanufacturing pilot projects have been carried
out steadily in China since 2008. NDRC takes charge of exploring the
strengthening supervision and management of product quality;
• increasing pilot projects in the remanufacturing industry, and im- pilot demonstration of automotive parts remanufacturing, while MIIT is
in charge of promoting the pilot demonstration of electromechanical
plementing advanced, smart and in-service remanufacturing de-
monstration projects; products remanufacturing.
• establishing green remanufacturing demonstration zones and in- MIIT, 2016a In 2008, NDRC officially launched the pilot project of
automotive parts remanufacturing. This project marked the beginning
dustrial parks, as well as circular economy demonstration parks.
of Chinese government organization of the remanufacturing industry,
with a total of 14 automobile and automobile component enterprises

Table 1
National law related to remanufacturing.
Title Date of Issue Date of Implementation Related Contents

Circular Economy Promotion Law August 8, 2008 October 26, January 1, 2009 The state supports enterprises to carry out remanufacturing of motor vehicle
(NPC, 2018) 2018(Revision) parts, engineering machinery, machine tools and other products. The quality of
the remanufactured products sold have to conform to national standards, and be
labelled as a remanufactured product in a prominent position.

8
X. Yuan, et al. Resources, Conservation & Recycling 161 (2020) 104920

Table 2
Regulation of the State Council related to remanufacturing.
Title Date of Date of Implementation Related Contents
Issue

Measures for the Management of End-of-Life
Vehicles Recycling (NPCSC, 2019b)
May 6, June 1,2019 (The Measures enacted by the If the “five major car parts” of dismantled ELVs are qualified for
2019 State Council on June 16, 2001 is abolished at remanufacturing, they can be sold to remanufacturing enterprises for
the same time) recycling. If the “five major car parts” are not qualified for
remanufacturing, they shall be used as scrap metals and sold to steel
companies as raw materials for smelting. The scrapped motor vehicle
recycling enterprise shall truthfully record the quantity, model and
destination of the main components such as the ‘five major car parts’
of ELVs recycled by the enterprise, and upload the information to the
scrapped motor vehicle recycling information system.

Table 3
Plans, guidelines and programs related to remanufacturing.
Title Department of Date of Issue Related Contents
Issue

The 11th Five-Year Plan Guideline for National
Economic and Social Development (NPCSC, 2006)
The 12th Five-Year Plan for National Economic and
Social Development (NPCSC, 2011)
Development Strategy and Recent Action Plan of
Circular Economy (NPCSC, 2013a)
Made in China 2025 (NPCSC, 2015)
The 13th Five-Year Plan Guideline for National
Economic and Social Development (NPCSC, 2016)
Green Development Plan of Industries (2016-2020)
(MIIT, 2016b)
Guidelines for the Implementation of Green
Manufacturing Engineering (2016-2020)
(MIIT, 2016c)
Implementation Plan of Producer Responsibility
Extension System (NPCSC, 2017)
Advanced Smart Remanufacturing Action Plan (2018-
2020) (MIIT, 2017)
CSC March 14, 2006 The construction of demonstration pilot projects for circular economy to be
promoted, including remanufacturing demonstration enterprises for
automobile engines, gearboxes and motors.
CSC March 14, 2011 The recycling system for old parts to be accelerated and improved. To develop
and apply key technologies of remanufacturing, and promote typical models
of the circular economy.
CSC February 6, 2013 Establish remanufacturing recycling mode and standardize implementation of
"trading old for remanufactured product". Automobile component, machine
tools, engineering machinery are the emphasis of remanufacturing. The
remanufacturing of aero engines and steam turbines should be explored.
Increase the proportion of government procurement for remanufactured
products.
CSC May 19, 2015 Vigorously develop the remanufacturing industry, implement advanced,
smart, in-service remanufacturing, and promote certification of
remanufactured products and the sustainable and healthy development of
remanufacturing. Carry out demonstration projects.
CSC March 16, 2016 Promote the recycling and linking of production system and living systems,
accelerate the utilization of waste resources, and standardize the development
of remanufacturing. Implement the responsibility extension system. Improve
the recycling network of regenerated resources.
MIIT July 18, 2016 Implement advanced, smart and in-service remanufacturing demonstration
projects to create a number of remanufacturing industry demonstration zones.
Strengthen the research and promotion of key technologies for
remanufacturing. Guide remanufacturing enterprises to establish a product
information management platform covering the whole process of
remanufacturing.
MIIT September 14, Promote the application of key technologies for remanufacturing, establish a
2016 remanufactured reverse intelligent logistics system, improve the certification
system for remanufactured products, and implement advanced, smart and in-
service remanufacturing demonstration projects.
GOSC January 3, 2017 Take the lead in implementing a producer responsibility extension system for
four types of products including automobiles and encourage production
enterprises to cooperate with dismantling enterprises and remanufacturing
enterprises to establish a reverse recycling system. Improve relevant laws and
regulations, and establish a unified remanufacturing product standard,
certification, and labelling system.
MIIT November 9, Focus on the remanufacturing of shield tunnel machines, aero engines, gas
2017 turbines, and medical imaging equipment, and mainstreaming green
technological practices. Promote the development and industrialization of key
technology equipment for advanced smart remanufacturing. Promote the
formation of an effective interaction mechanism on design and manufacturing
between remanufactured product and new product, and strengthen the
formulation of standards and evaluation mechanism.

selected for remanufacturing pilot exploration. In order to strengthen
coordination and guidance for the pilot projects, NDRC approved 28
enterprises as the second batch of automobile component re-
manufacturing pilot projects in 2013. These pilot projects could explore
the policies, management and regulatory systems for automobile com-
ponent remanufacturing industry, and provide experience for further
development.
MIIT has initiated pilot demonstration work on electromechanical
products remanufacturing since 2009. To date two batches of pilot
demonstrations for remanufacturing have been launched, including 86
enterprises and 5 industrial clusters. The scale, standardization and
specialization of the remanufacturing industry of electromechanical
products have been continuously promoted, with an increasing scope
including high value-added and large-scale complete equipment sets,
electronic products, as well as in-service equipment and their key
components.
5.3.4. Remanufacturing product labelling
In order to promote the orderly development of the re-
manufacturing industry, standardize the production of remanufactured

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X. Yuan, et al. Resources, Conservation & Recycling 161 (2020) 104920

Table 4
Implementation Proposals and Regulations related to remanufacturing.
Title Department of Issue Date of Issue Related Contents

Proposal on Promoting the Development of
Remanufacturing Industry (NDRC, 2010c)
Catalogue of Remanufacturing Technology and
Equipment for Electromechanical Products
(MIIT, 2012)
Proposal on Enhancing Energy Saving and Emission
Reduction in Internal Combustion Engine Industry
(NPCSC, 2013b)
Proposal on Accelerating the Development of Energy
Conservation and Environmental Protection
Industry (NPCSC, 2013c)
Guidance on Promoting Green Consumption
(NDRC, 2016)
NDRC, MOST, MIIT, MPS, MOF, May 13, 2010 Put forward key areas for promoting the development of the
MEP, MOFC, GAC, SAT, SAIC, remanufacturing industry, strengthen technological innovation in
APSIQ the remanufacturing industry, and promote its industrialization.
Improve policy support for the development of the
remanufacturing industry. Formulate and publish the Catalogue of
Remanufactured Products, and study the fiscal tax incentives for
remanufactured products listed in the catalogue.
MIIT June 7, 2012 The main contents, applicable fields and main problems of
remanufacturing are introduced, including forming and
processing, disassembly and cleaning, non-destructive testing and
life evaluation technology.
GOSC February 17, Promote the remanufacturing of internal combustion engine
2013 products, formulate relevant promotion plans, carry out R&D of
key common technologies, and improve the market system for
recycling old parts. Cultivate key remanufacturing enterprises for
automobiles and engineering machinery engines.
CSC August 12, Support the establishment of 10-15 national remanufacturing
2013 industry clusters and a number of major demonstration projects.
Support specialized companies to provide personalized
remanufacturing services for high-value and vulnerable parts of
industrial and mining equipment. Establish a remanufacturing
information management system of used parts recycling, product
marketing and traceability.
NDRC, PDCCC, MOST, MOF, February 17, Encourage the consumption of green products, organize the
MEP, MOHURD, MOFC, APSIQ, 2016 implementation of "trading old for remanufactured product",
CNTA, GOASC promote the remanufacturing of engines and gearboxes, establish
and improve incentive mechanisms for consumers.

products and guide the consumption of remanufactured products, the
Chinese government has issued 13 relevant labelling standards. These
standards include 1 automobile component remanufacturing product
labelling specification, 1 product identification specification, 1 quality
control system specification for production process, 1 product coding
rule for "trading old for remanufactured product", and 9 product iden-
tification procedures. Table 6 lists the main documents. NDRC designed
the remanufacturing product labelling of automotive parts. NDRC,
MOF, MIIT, MOFC and APSIQ have standardized the code of "trading
old for remanufactured product", which consists of one letter and ten
numbers. MIIT focused on the management and supervision of re-
manufacturing product identification, and formulated relevant re-
quirements and implementation plans. In addition, MIIT organized the
identification work of remanufactured products and published the Re-
manufacturing Product Catalogue.
5.3.5. Capital subsidies and preferential policies
The government programme of credit support and financial
subsidies to develop the circular economy promotes industrial energy
conservation and green development, and addresses the problem of
insufficient capital investment in the circular economy.
Remanufacturing is viewed as one of the key projects in developing the
circular economy supported by various financial institutions. A total of
7 financial policies have been enacted by government agencies, and
some are noted in Table 7.
The People's Bank of China has given credit support to re-
manufacturing projects for electromechanical products. Central gov-
ernment arranges special funds to support remanufacturing, including
the advancement of remanufacturing technology, the construction of
end-of-life parts recycling systems, the promotion of remanufactured
products and the development of the industry. The China Development
Bank has effectively played the role of the main domestic green credit
bank, which provides low-cost capital support, and promotes the R&D
and industrialization of key technologies, and advanced and smart re-
manufacturing.
In 2013, several subsidised pilot projects promote the recycling and

Table 5
Policies related to remanufacturing pilot projects.
Title Department of Date of Issue Related Contents
Issue

Notice on Organizing Remanufacturing Pilot of
Automotive Parts (NDRC, 2008)
Notice on Organizing Remanufacturing Pilot of
Electromechanical Products (MIIT, 2009a)
List of Pilot Enterprises for Electromechanical Products
Remanufacturing (The First Batch) (MIIT, 2009b)
Notice on Promoting the Remanufacturing Pilot
(NDRC, 2011)
Notice on Identifying the Second-batch Remanufacturing
Pilot (NDRC, 2013b)
List of Pilot Enterprises for Electromechanical Products
Remanufacturing (The Second Batch) (MIIT, 2016a)
NDRC March 2, 2008 The pilot project of automobile parts remanufacturing was officially
carried out, and 14 automobile and automobile component enterprises
were selected as the first batch of remanufacturing pilot enterprises.
MIIT July 7, 2009 A group of enterprises with good remanufacturing potential are
determined to carry out pilot projects, relying on pilot enterprises to
actively explore the basic practices, related policies, management and
supervision systems of electromechanical products remanufacturing.
MIIT December 21, Thirty-three enterprises and two industrial clusters were certificated as the
2009 first batch of remanufacturing pilot units for electromechanical products.
NDRC September6, 2011 The scope of remanufacturing pilots to be expanded. Government
investment to provide financial support to private enterprises.
NDRC February 27, 2013 Twenty-eight enterprises were certificated as the second batch of pilot
units for automotive parts remanufacturing.
MIIT February 22, 2016 Fifty-three enterprises and three industrial clusters were certificated as the
second batch of pilot units for electromechanical products
remanufacturing.

10
X. Yuan, et al.
Table 6
Policies related to specification of the remanufacturing product labelling.
Title
Notice on Implementing and Strengthening the Management and
Protection of the Remanufacturing Product Labelling of
Vehicle Components (NDRC, 2010a)
Guidelines for the Implementation of Identification of
Remanufactured Products (MIIT, 2010)
Quality Technical Control Specification for Remanufacturing
Enterprises (Trial Implementation) (NDRC, 2013a)
Notice on the Implementation of Relevant Documents in the Pilot
Project of "Trading Old for Remanufactured Product"
(NDRC, 2014)
expand the source of old parts. Central government provided a one-time
subsidy to purchasers through the pilot enterprises. A ceiling was set for
this subsidy.
5.3.6. National standards
China has issued national standards for remanufacturing since 2011.
General Requirements and Labelling for Recycled and Remanufactured
Products (GB/T 27611-2011) is the first standard in the field of re-
manufacturing, and represents a landmark in the development of the
standard system for the remanufacturing industry. There are 38 effec-
tive remanufacturing standards and 4 standards currently awaiting
implementation. There are 8 standards for basic design, 3 for man-
agement, 23 for method, 7 for products and 1 comprehensive standard.
The general identification, technical specification, quality inspection
and other related requirements of remanufacturing have been stan-
dardized. A systematic and completed remanufacturing standard
Table 7
Policies related to capital subsidies and preferential policies.
Title Department of
Issue
Notice on the Investment and Financing Policy to Support NDRC
the Development of Circular Economy (NDRC, 2010b)
PBC
CBRC
CSRC
Notice on Interim Measures for Management of Special MOF
Funds for the Development of Circular Economy
(MOF, 2012)
NDRC
Pilot Implementation Plan of "Trading Old for NDRC
Remanufactured Product" (NDRC, 2013c)
MOF
MIIT
MOFC
APSIQ
Notice on Accelerating the Promotion of Industrial Energy MIIT
Conservation and Green Development (MIIT, 2019)
CDB
Resources, Conservation & Recycling 161 (2020) 104920
Department of Date of Issue Related Contents
Issue
NDRC February 21, 2010 The automobile component remanufacturing product labelling is
announced and recorded for protection at SAIC. Remanufacturing
labelling will be applied in the pilot enterprises firstly, and then
promoted throughout the country.
MIIT October 15, 2010 The identification procedure of remanufactured products is
standardized, which includes four stages: declaration, preliminary
examination and recommendation, identification and evaluation,
and release of results. The remanufactured product identification
labell should be used on the products or on the packaging.
NDRC January 23, 2013 Stipulate the basic conditions required for remanufacturing, as well
as the guarantees and quality control requirements for
remanufacturing enterprises in the process of recycling, production
and sales.
MOF
MIIT
APSIQ
NDRC September15, 2014 Formulate the method for identification requirements for pilot
enterprises "trading old for remanufactured product", and the
coding rules of "trading old for remanufactured product".
MOF
MIIT
MOFC
APSIQ
system has been gradually established. The title and date of issue of
these standards are in the appendix.
6. Discussion
China has established a remanufacturing management system, with
NDRC and MIIT as the leading agencies, supplemented by MOF, MOST,
SAMR, MOFC and MEE, etc. The policy system of remanufacturing is
also in place, taking national law, regulation of the State Council,
documents of the State Council, Ministries and Commissions as com-
ponents. This comprehensive set of documents provides a legal guar-
antee and policy basis for the development of remanufacturing. The
remanufacturing industry has developed rapidly under the impetus of
the management institutions and policy system. At present, China has
formed an initial development model with the main technical features
of “restore the original size and improve the performance of
Date of Issue Related Contents
April 19, Key projects funded by the national credit include remanufacturing projects
2010 for used automobile components, engineering machinery, machine tools and
other products supported by the national and provincial governments.
July 20, Special funds focus on supporting the advancement of remanufacturing
2012 technology, the construction of an old parts recycling system, the promotion
of remanufacturing products and the development of industrialization.
July 4, 2013 To carry out "trading old for remanufactured product" for automotive
engines. Central government will give consumers one-time subsidy for
remanufactured products that meet the requirements.
March Green financial funds focus on supporting R&D, application and
29,2019 industrialization of key remanufacturing technology and equipment, and
promoting advanced smart remanufacturing.
11
X. Yuan, et al. Resources, Conservation & Recycling 161 (2020) 104920

Table 8
Laws related to resource recycling in Japan.
Title Date of Related Contents
Issue

The Waste Disposal Law 1970 The operation mechanism for promoting the recycling of scrapped vehicles and household machines was
determined, and fines, taxation and other disciplinary measures were taken for illegally abandoning waste.
Law for Promotion of Effective Utilization of 1991 The operation mechanism of judgment benchmark, prior evaluation and information provision to promote the
Resources recycling of end-of-life vehicles and household machines is determined.
Basic Law on Establishing a Sound Material- 2000 A detailed incentive policy has been formulated for the recycling of waste. The disposal of waste products must
Cycle Society be paid to the state. Stipulate that if a car user gives a scrap car part to a remanufacturing company, the waste
disposal fee can be waived.
The Waste Management and Public Cleansing 2000 Address the issues of illegal dumping, inappropriate storage and treatment of waste
Law
Home Appliance Recycling Law 2001 Establish a system to properly recover End-of-Life home appliances and efficiently recycle them so that they can
be reborn as raw materials
The ELV Recycling Law 2005 Implement a strict qualification permit system for the auto remanufacturing, and set up a matching fund and
subsidize the recycling of used cars.

remanufactured products”. Despite the enduring efforts that have been
made for remanufacturing, there are still some issues that need to be
resolved. Some existing problems and deficiencies of remanufacturing
in China are identified through the comparison with policies of the U.S.,
Europe, and Japan. Referring to successful development models in these
countries, strategies and perspectives are proposed to improve these
policies.
6.1. Defining the Responsibility of Management Institutions
The management institutions and policy system related to re-
manufacturing vary across countries. The U.S. federal government in-
troduced less intervention to the development of remanufacturing in-
dustry, while the development of this industry was achieved through
the market competition (Li, 2015). The U.S. government has enacted a
special remanufacturing act, i.e. the Federal Vehicle Repair Cost
Savings Act (USA Government, 2015). Several federal agencies have
been involved in this effort. In addition, some states introduced state-
level initiatives that have facilitated the industry, such as New York,
California, Texas, Pennsylvania and Michigan (Vlaanderen, 2018). In
addition, remanufacturing associations play a crucial role in promoting
the development of remanufacturing in the U.S. They provide product
information for business services and lobby the government for in-
dustrial development (APRA, 2015). In UK, the development of re-
manufacturing is promoted via a collaboration between government
and non-governmental environmental organizations. The Department
for Business, Innovation and Skills (DBIS, 2015) and the Department for
Environment, Food and Rural Affairs (DEFRA, 2012) are mainly re-
sponsible for the efficient use of resources and the development of
circular economy. Other organizations such as European Re-
manufacturing Council, Centre for Remanufacturing and Reuse, Oak-
dene Hollins Ltd are also play a critical role for the remanufacturing
development in the UK. In Japan, the development of remanufacturing
industry is guided by the related legislations. A mature legislative
system on circular economy lays a strong foundation to build a resource
recycling society.
Compared with the remanufacturing effort in the developed coun-
tries, the system of multi-department collaborative management in
China has resulted in the overlap of powers and responsibilities of
different government agencies. For instance, the NDRC, MIIT and MEE
all participate in the formulation and organization of industrial energy
conservation and green development plans. Such a departmental col-
laborative management system will inevitably cause the executive de-
partments to lack the internal motivation and external binding force,
which is liable to evade and transfer responsibilities. Therefore, it is
necessary to improve the system of government responsibility. The
adjustment of institutions with overlapping responsibilities to form a
more scientific and efficient management system is necessary.
6.2. Completing the National Legislation
The law and regulations of remanufacturing need to be improved.
Firstly, China has only one national law on remanufacturing at the
moment. In addition, it is hard to regulate the specific issues of re-
manufacturing from the aspect of national law. There is lack of re-
inforcement power from these development guidelines and basic po-
licies of the remanufacturing. Some regulations and rules have a weak
legal guarantee for promoting the large-scale and standardized devel-
opment of remanufacturing industry. The government should improve
the Circular Economy Promotion Law to enhance its applicability and
pertinence.
Secondly, according to Fig. 5 and Fig. 6, there are problems with the
recycling of renewable resources in China, which are manifested in
large scrap volumes and low recovery rates. The inability to recycle
waste products effectively will also hinder the development of re-
manufacturing. The U.S., Europe and Japan have issued a number of
special policies for the recycling of waste resources, and established a
recycling mechanism for waste collection, treatment and reuse. For
example, the U.S. Environmental Protection Agency launched Re-
covered Materials Advisory Notices in 2007 (EPA, 2007); the U.K. De-
partment for Environment, Food & Rural Affairs issued Resource Se-
curity Action Plan: Making the most of valuable materials in 2012
(UK Government, 2012). Japan's efforts in resource recycling are the
most prominent, which has a relatively mature renewable resource
management system. Japan has formulated basic laws, comprehensive
laws and special laws to manage renewable resources. The relevant
laws and main contents are shown in Table 8. A mechanism for shared
responsibility among governments, enterprises, and the public has been
established. As a result, every participant in the recycling process of
waste products devote themselves to the recycling work, which im-
proves the level of recycling of waste products, and achieves optimal
results in the development of recycling-oriented society.
With the rapid development of China's economy, there is rapid
growing demand on resources and energy. As a consequence, last
decades have witnesses an increasingly acute conflict amongst eco-
nomic development, resources and the environment. Circular Economy
Promotion Law has been unable to meet China's needs for resource
recycling. Referring to Japan's experience, the Comprehensive
Utilization of Resources Law in China needs to be formulated as soon as
possible to achieve the efficient use of resources and gradually establish
a legal system with Chinese unique characteristics for the recycling of
waste mechanical and electrical products. This is crucial for the sus-
tainable development of remanufacturing industry in China.
6.3. Launching Tax Incentives for Remanufactured Products
Tax incentives for remanufacturing is beneficial to increase the

12
X. Yuan, et al.
social acceptance of customers and encourage the firms to enlarge the
scale of remanufacturing, but the related policies have not been fully
implemented in China. In U.S., the Revenue and Taxation Code in
California (California Government, 2020) and the P.L. 211-2007 Reg-
ulation in Indiana (Indiana Government, 2016) have provided tax ex-
emptions policies for the sale and use of remanufactured products.
Mississippi sales tax law provides detailed tax reduction rate for re-
manufacturers. The reduced rate of 1.5% applies to the sale or rental of
remanufacturing machinery and parts (Mississippi Government, 2020).
In UK, the tax scheme is established that government provides a fund
for the treatment of WEEEs. Original Equipment Manufacturers con-
tribute to this fund in the form of taxes, while firms that recycle and
remanufacture used products receive subsidies from this fund
(DBIS, 2015). In China, the Proposal on Promoting the Development of
Remanufacturing Industry jointly issued by the NDRC and ten other
departments clearly stated that the government will study the fiscal and
tax incentives for remanufactured products. However, the tax in-
centives for the remanufacturing have not yet been implemented. Re-
manufacturing enterprises cannot obtain VAT invoices to deduct costs
for the purchase of end-of-life parts, which reduces the profit margin of
remanufacturing enterprises and limits the development of re-
manufacturing industry. It is imperative to carry out the tax incentives
and increase subsidies and tax breaks for enterprises to solve the ex-
isting problem on production tax credit.
6.4. Establishing Standardized and Orderly Reverse Logistics System
A complete reverse logistics system has not yet been established. In
order to regulate the cyclic utilization management of resources, some
countries have issued relevant policies on the extended producer re-
sponsibility system. Maine enacted the Extended Producer
Responsibility Act by which municipalities collect electronics and in-
voice the manufacturers of returned product for the cost of collection
and transport to recyclers (Webster and Mitra, 2007). The E.U.'s WEEE
Directive requires manufacturers to recycle used electronic products
and sets a minimum recovery rate (EU, 2017). The ELV Recycling Law
of Japan stipulates that car owners pay the recycling fee first when they
purchase a new car, and car manufacturers are obliged to take re-
sponsibility for used parts, and sets a specific target that the recycling
rate is more than 95% (Despeisse, 2015). In China, the General Office of
the State Council issued the Producer Responsibility Extension System
Implementation Plan in 2017. China began to implement a producer
responsibility extension system for four categories of products, where a
reverse recycling system has been gradually established. However, the
recycling channel of "used parts" is not good which results in a low
recycling rate of scrapped electromechanical products and ELVs. Be-
cause of the lack of an effective recycling system for used parts, en-
terprises are suffering from supply shortages. Although China has pro-
mulgated relevant policies to encourage the pilot work of "trading old
for remanufactured product" and expanded the sources of old parts,
there are still obstacles such as irregular recycling channels and poor
recycling order, which lead to the flow of used parts into irregular
businesses and limit the recycling of used parts. Chinese government
agencies should set specific recovery rates in the policy first, and then
develop relevant reward and punishment mechanism to strengthen the
recycling system for parts and components. What's more, based on the
continuous integration of advanced information technology and man-
ufacturing industries, "Internet Plus Remanufacturing " should be im-
plemented in accordance with the principle of “distributed recycling,
centralized distribution, and utilization of specifications”, to accelerate
the realization of a standardized and orderly reverse logistics system.
6.5. Completing the System of Standards
The emerging industry is a new sector that stimulates the economic
growth. The U.S. proposed the concept of Industrial Internet, which
13
Resources, Conservation & Recycling 161 (2020) 104920
connects virtual network and entity to form a more efficient production
system (Posada et al., 2015). The Europe has developed the 2020
Strategy, focusing on the development of advanced manufacturing with
themes at intelligence (Marlier, 2010). The Germany Industry 4.0 Plan
aims to establish a smart manufacturing production framework to fur-
ther improve efficiency and flexibility (German Federal
Government, 2017). The standardization system for these emerging
industries has been established in developed countries to a certain de-
gree. German has issued a roadmap for the Industry 4.0 standardization
system, and have established several top-level standards
(Kusiak, 2018). U.S. National Institute of Standards and Technology
presented the basic architecture for the smart manufacturing ecosystem
in 2016 (Lu et al., 2016). Compared with the smart manufacturing
standard system of developed countries, China's standardization work
of remanufacturing lags behind practice. The remanufacturing industry
has focused on advanced smart remanufacturing with high technology
content, high reliability requirements and high added value as its core
characteristics. However, the relevant standards on smart re-
manufacturing have not yet been published. Hence, it is urgent to de-
velop technology standards and product standards for advanced smart
remanufacturing.
6.6. Enhancing the Awareness of Consumers
In U.S., the same quality standards are applied in remanufactured
products compared to new products. In addition, the U.S. government
has adopted a series of actions such as: continuously promoting the
advantages of remanufacturing to the public, facilitating enterprises to
carry out remanufacturing production, and encouraging consumers to
purchase remanufactured products (Mitra and Webster, 2008). Coupled
with the price advantage and good quality of remanufactured products,
consumers gradually improve their awareness toward the re-
manufactured products. Compared with traditional manufacturing in-
dustry, remanufacturing is a new concept that has not been widely
recognized by consumers and some government officials in China. A
considerable number of enterprises have a negative attitude towards
remanufacturing and are reluctant to carry it out. Consumers have a
low level of understanding of remanufactured products and believe that
the remanufactured products are second-hand products, which have
inferior performance to new products. The publicity and case for re-
manufactured products should be strengthened to encourage the par-
ticipation of different stakeholders. Therefore, the government should
play an even more important role in this activity, raising the awareness
of enterprises and consumers on remanufactured products, stimulating
the enthusiasm of enterprises for the production, and encouraging
consumers to accept and use remanufactured products.
7. Conclusions
As an extension of manufacturing industry, and an integral part of
advanced and green manufacturing, remanufacturing is an important
sector for green development. It has realized the development and ex-
tension of life cycle management of green manufacturing, which is of
great significance for promoting the development of the circular
economy. Remanufactured products can achieve remarkable savings in
terms of cost, energy and material compared to new products.
Consequently, remanufacturing is one of the best ways to achieve re-
source recycling. China has basically established a remanufacturing
management institutions and policy system. NDRC and MIIT are the
leading agencies, supplemented by MOF, MOST, SAMR, MOFC and
MEE, etc. The Circular Economy Promotion Law and 167 regulations
and documents constitute the policy framework for remanufacturing
industry. Leading by these governmental agencies and policy system,
the remanufacturing industry has developed rapidly in China and is
expected to exceed 200 billion RMB by 2020.
China's next priority includes defining clear and specific
X. Yuan, et al.
responsibility of management institutions, completing the national
legislation and standards system, launching tax incentives for re-
manufactured products, establishing a standardized and orderly reverse
logistics system, strengthening the publicity and promotion of re-
manufactured products, and enhancing consumer awareness. The
Chinese remanufacturing sector has great potential to establish a
market-oriented policy system and management mechanism and pro-
gressing the nation towards sustainability. The experience of promoting
remanufacturing in China is also potentially helpful to other countries.
Declaration of Competing Interest
The authors declare that they have no known competing financial
interests or personal relationships that could have appeared to influ-
ence the work reported in this paper.
Acknowledgments
This research is supported by National Key R&D Plan
(2019YFC1908100), Natural Science Foundation of China (71974116),
Shandong Provincial Key R&D Plan (2019RZE27013, 2019RKE27001,
2018GSF122005), Shandong Natural Science Foundation
(ZR2019MG009), and Shandong Provincial Social Science Planning
Research Project (20CGLJ13). The authors thank Professor Jon Kellett
at The University of Adelaide for constructive suggestions and English
improvement.
Supplementary materials
Supplementary material associated with this article can be found, in
the online version, at doi:10.1016/j.resconrec.2020.104920.
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