The Ministry of Environment will initiate the first ‘planned regulatory sandbox’ to lower regulatory barriers, enabling the introduction of new circular economy technologies and services into reality.
The Ministry announced that it has selected three projects as the planned regulatory sandbox tasks: △recycling of agricultural by-products (rockwool) from facility cultivation △recycling of lithium iron phosphate (LFP) batteries △extraction of key minerals from printed circuit boards (PCBs). They plan to recruit demonstration operators from August 7 to September 6 for a period of 30 days.
A regulatory sandbox is a system designed to solve the problem where new technologies or services cannot be applied due to existing laws. It allows exemptions or relaxation of regulations for a certain period to permit testing. The circular economy regulatory sandbox, which has been in full operation since 2024, differs from the previous method where individual companies applied for exemptions. This time, the government first plans the projects and recruits operators to participate, forming a ‘government-led’ model.
The selected projects are areas where commercialization was impossible or restricted under current regulations. The projects aim to link demonstration results with the revision of related laws, thus drawing attention.
The first task is the demonstration of recycling rockwool medium. Rockwool, an artificial mineral processed into fiber from basalt melted at high temperatures, is used as a medium that maintains moisture and air appropriately in hydroponics. However, post-use waste rockwool is designated as ‘other waste’ under the current waste classification system, making recycling impossible. Through this demonstration, they will explore the possibility of producing recycled products such as artificial soil and push for amendments to related classification systems.
The second task involves the LFP battery recycling project, which is gaining attention with the spread of electric vehicles. LFP batteries, using lithium, iron, and phosphate as cathode materials, are safer and more economical than existing nickel-cobalt-manganese (NCM) batteries. However, a clear institutional foundation for their recycling is still lacking domestically. This demonstration aims to verify business feasibility and technical prowess, leading to improvements in relevant regulations.
The third task is the demonstration of extracting key minerals such as copper and nickel from PCBs. PCBs, found in most electronic products, are currently classified as ‘waste synthetic resins’ or ‘waste electrical and electronic devices,’ making high-value recycling difficult. To address this, the demonstration will track the entire process of collection, transport, and recycling of PCBs and consider the need for a new waste classification number.
The Ministry of Environment is recruiting businesses interested in participating in this demonstration task through the ‘Environment Technology Industry One-Stop Service’ from August 7 to September 6, and will select the final businesses by examining alignment and specificity of their business plans. Afterward, the selected businesses may be granted demonstration exemptions as soon as October, following processes through a pre-review committee and a deliberation committee.
The selected businesses will conduct demonstrations for two years (with an additional two years possible), and the Ministry will support up to 120 million won for demonstration project costs, up to 20 million won for liability insurance (within 50% limit), and provide legal review, consulting, etc.
Kim Go-eung, Director of the Resources Circulation Bureau of the Ministry of Environment, stated, “Through this planned regulatory sandbox, we will enhance the usage of waste resources and lay the foundation for creating new green industries,” adding, “Based on the voices from the field, we will improve regulations and create a legal framework that enables commercialization.”