On April 1, 2026, the Interim Measures for the Management of Recycling and Comprehensive Utilization of Retired Power Batteries from Electric Vehicles (hereinafter referred to as the "Measures"), jointly issued by six government departments including the Ministry of Industry and Information Technology (MIIT), the National Development and Reform Commission (NDRC), and the Ministry of Ecology and Environment (MEE), officially came into effect.
The introduction of the Measures represents a necessary step to align with industrial development needs and address long-standing industry challenges. It also serves as a key implementation measure following the State Council's Action Plan for Strengthening the Recycling and Utilization System for Electric Vehicle Power Batteries issued in February 2025.
The Measures employ a legal and regulatory framework to govern the entire recycling and utilization chain, steering the industry from "unregulated expansion" toward "orderly and standardized development." They establish clear boundaries and pathways for the power battery recycling sector, supporting its healthy and sustainable growth.
First, the Measures clearly define comprehensive utilization as the resource-oriented activities involved in dismantling, crushing, sorting, and smelting waste power batteries. The concept of "reuse" has been removed from the regulatory framework and placed under market-driven arrangements. It is now stipulated that any reuse of retired batteries must comply with legal requirements and applicable standards.
China has already cultivated 148 leading enterprises specializing in comprehensive utilization. Building on this new definition, the government will further refine corporate qualification standards to guide the industry toward high-quality development. Statistics show that there are currently 48 enterprises engaged in recycling, 85 focused on battery reuse, and 15 involved in both. The redefinition is expected to concentrate industry resources toward compliant recycling operations.
Besides, the Measures specify nine stages at which waste power batteries are generated, covering R&D, production, testing, vehicle assembly, storage, transportation, use, maintenance, and vehicle reaching end-of-life. Responsibility for recycling is allocated accordingly.
Specially, power battery manufacturers are responsible for recycling batteries they produce or import (except those already sold to automakers). They must establish recycling service networks in each provincial-level administrative region, with capacity aligned to sales volumes.
OEMs are responsible for recycling batteries installed in vehicles they sell. They must establish recycling outlets at the municipal level and, when batteries reach end-of-life, notify users of the recycling process via onboard systems or after-sales service.
For process scrap generated during R&D, production, and testing, the Measures require its comprehensive utilization in accordance with the Law on the Prevention and Control of Environmental Pollution by Solid Waste and other relevant regulations, ensuring full lifecycle coverage and ensuring that no waste batteries escape the collection system.
Moreover, the Measures stipulate that end-of-life vehicle recycling and dismantling companies must lawfully recover and dismantle electric vehicles to address the issue that, under the vehicle-battery separation model, retired batteries from scrapped vehicles have historically been at risk of diversion into illegal recycling channels. If a scrapped electric vehicle is found to have its power battery missing, the vehicle will be classified as incomplete; detailed implementation rules will follow.
This provision integrates vehicle dismantlers into the recycling chain as a critical player, closing the loophole through which retired batteries could otherwise leak into illegal channels. This marks a milestone in standardizing the industry and lays the groundwork for a more structured recycling process. How this provision is implemented on the ground will be crucial, with more detailed rules to follow.
Separately, the Measures mandate that the MIIT, in collaboration with relevant State Council departments, establish a national traceability platform for power batteries from electric vehicles. The platform will track the full lifecycle flow, from production and sales to maintenance, replacement, dismantling, recycling, and comprehensive utilization, and enable information-based tracing.
A national digital identity management system for power batteries will also be introduced. The digital identity will contain essential information such as product category, composition, and end-of-life recycling status, with detailed rules to be issued separately.
The traceability platform and digital identity system are critical to achieving comprehensive, efficient recycling coverage across the full lifecycle of power batteries. Given the complexity and number of stages involved, further implementation details will be specified in subsequent regulations.
Lastly, to ensure effective implementation, the Measures establish a cross-departmental collaborative oversight mechanism. Six government bodies at the county level and above, including industry and information technology, development and reform, and ecology and environment, are assigned with supervisory responsibilities, with authority to conduct on-site inspections, gather evidence, review records, and take other supervisory actions.
The Measures also specify penalties for various violations. For example, enterprises failing to fulfill recycling obligations will be ordered to rectify; those refusing may face warnings or fines of up to RMB 50,000. And diverting waste batteries to unauthorized entities may result in fines of RMB 10,000-30,000.
Comprehensive utilization enterprises found in violation will be ineligible to apply for industry qualification for two years; severe cases may result in revocation of qualifications, and criminal liability will apply if warranted.
These clearly defined penalties significantly raise the cost of non-compliance, providing strong enforcement support for the Measures.
Going forward, the new regulatory framework is expected to reshape the power battery recycling landscape into a clear division of roles: efficient government oversight; battery and vehicle manufacturers bearing primary recycling responsibility; end-of-life vehicle dismantlers providing access at the scrap stage; and compliant enterprises handling comprehensive utilization.
The Measures mark the beginning of a new, legally grounded phase for China's power battery recycling industry defined by standardized operations.
For the industry, the Measures will raise entry barriers, drive out illegal operators, concentrate resources among compliant players, and elevate compliance and technical standards. For individual companies, reinforced producer responsibility and a new traceability system will push them to strengthen recycling networks and increase R&D. Leading enterprises, backed by technology, capital, and established channels, are poised to expand their market share.
Written by Aggie Hu, huchenying@mysteel.com
