Illegal Trade of HFCs

HFCs are colorless and odorless gases at room temperature, composed of carbon, fluorine, and hydrogen atoms. They are synthesized industrially and used as refrigerant gases. Although they were once a sustainable alternative to CFCs and HCFCs, which play a significant role in ozone layer depletion, HFCs are potent greenhouse gases with a relatively high global warming potential (GWP).

In light of this and to mitigate the effects of these gases on climate change, the UN established an international agreement to reduce their consumption: the Montreal Protocol (1987), and the subsequent Kigali Amendment (2019), which set the goal of reducing HFC production and consumption by 80% over the next 30 years. In response to this agreement and to ensure compliance, the European Union established the F-gas regulation, a quota-based system. Under this regulation, each company is granted an annual import quota for HFCs, which gradually decreases to encourage the transition to alternatives with lower GWP.

Despite significantly contributing to the reduction of HFC consumption in the EU, this regulation has led to an unintended side effect: the emergence of a black market for HFCs. The limit on the amount of HFCs each company can import results in an increase in the market price of these gases in the EU, which is significantly higher than the price outside the quota. Consequently, there is a demand for HFCs imported illegally and not registered under the F-gas quota system.

The vast majority of these illegally imported HFCs come from China, traveling through Turkey and Ukraine to enter the EU via border countries such as Bulgaria or Romania. Once past the entry customs, the gas can move freely within the EU without any requirement to prove whether it is registered under the F-gas system.

While EU law enforcement agencies make great efforts to control and stop the illegal importation of HFCs, importers are increasingly employing more creative methods to avoid detection. These include labeling and declaring HFCs as other gases not subject to the quota system, smuggling HFCs in small quantities within buses or trucks, or wrapping the gas cylinders in black plastic to make identification more difficult.

A recent example of this activity was seen in Granada, where the Guardia Civil, as part of operation “Ecogas,” arrested six individuals involved in the fraudulent trade of refrigerant gases. The detainees advertised these gases through various websites as “ecological” substitutes for fluorinated refrigerants, despite being highly flammable hydrocarbon derivatives unsuitable for such use.

Regardless of the method of entry and concealment, the illegal importation of HFCs increases climate change, endangers the safety of installers and users of refrigeration systems, and economically impacts businesses that adhere to current regulations. Additionally, illegal refrigerant trade has been linked to crimes such as bribery, corruption, tax evasion, organized crime, money laundering, and trafficking of other illegal substances.

For this reason, we believe it is essential to emphasize the imperative need to invest efforts in strengthening the monitoring and reporting of the movements of these gases, as well as imposing stricter measures in response to non-compliance with current regulations.

References:

• EIA (2024), “More Chilling Than Ever – Tackling Europe’s ongoing illegal trade in HFC climate super pollutants”.
  Available at this link.

• CCA Coalition, “Hidrofluorocarbonos”.
  Available at this link.

• EFCTC, “What is the Kigali Amendment?”.
  Available at this link.

• EIA, “The EU HFC phase-down”.
  Available at this link.

• EFCTC, “About Illegal Trade Of HFCs”.
  Available at this link.

• Ideal (2024), “Cae una empresa de Granada que vendió 30 toneladas de gases de refrigeración con alto riesgo de incendio”.
  Available at this link.