1. PSES Symposium 2006, Irvine, CA Keynote Address Global Driving Forces in the Compliance Industry Grant Schmidbauer Nemko North America, Inc.

2. Contents Global driving forces - Dynamics in the Global Economy - Technology Drives Innovation - Regulatory Trends - WEEE and RoHS Consequence of global driving forces - Product development cycle - Development of services - International IECEE CB scheme Summing up

3. Global Driving Forces Dynamics in the global economy Technology drives innovation Regulatory trends WEEE and RoHS

4. Dynamics in the Global Economy (1) Manufacturing moves to China WTO forces China to open Testing services to follow Inspection service needs Service growth and systems innovation in developed economies

5. Dynamics in the Global Economy (2) Global market access requirements Global resource access Vertical integration of supply chain On-line banking / digital signatures Compliance and tax requirements

6. Technology Drives Innovation (1) Instant communications Mobile products Wireless access Services on demand, on-line, 24/7 Massive storage capacity High capacity processing

7. Technology Drives Innovation (2) Triple convergence (“the world is flat”) - new platform (a flat world) - horizontalization (available to everyone) - world wide players (everyone plays) Internet as the medium - world-wide communication channel Security issues “The World is Flat”, by Thomas L. Friedman (Farrar, Straus and Giroux, copyright 2006)

8. Regulatory Trends (1) Fast global market access on-line protection/harmonization Technical and commercial requirements Recycling electric and electronic products Hazard Based Safety Engineering ISO9004:2000 Process Management Systems

9. Regulatory Trends (2) Harmonized Standards Industry Preference Type Approval Declaration of Conformity MandatorySelf Declaration Regional/ Local Global Product Approval Regimes

10. Regulatory Trends (3) Contains risk (MDD, ATEX) Environmental Industry Preference America Asia Russia EU (CE+R&TTE) Market Surveillance Mandatory Self Declaration Regional/ Local Global Product Approval Requirements

11. WEEE and RoHS (1) Purchase

12. WEEE and RoHS (2) Europe California (+ others) China Japan Australia Thailand Korea NYC Global overview

13. WEEE and RoHS (3) EU China America Japan 2000 Proposition65 ELV IPP SB20SB50 REACH RoHSWEEEEuP China RoHSChina WEEE RLERLARL Paint, VOCs Regulations TSCA 67 CPLD 91 BAD 94 PPW Others 20032005200620072010 Korea AusThai Growing worldwide regulations

14. Consequence of Global Driving Forces Product development cycle Development of services International IECEE CB scheme

15. Product Development Cycle (1) Ide a R&DPre-ProdT&C Market Access Problems Time to Market / Customes Focus Compliance Focus Compliance Yesterday

16. Product Development Cycle (2) Ide a R&DPre-ProdT&C Market Access Time to Market/Customer Focus Compliance Focus Today and Tomorrow

17. Development of Services (1) Shorter product to market cycles Retailers (OEMs) move to direct import Compliance competence required Competition fosters efficient supply chains Access to on-line services

18. Development of Services (2) Pre- and post-compliance services Pre-compliance support Local production surveillance Certification of batch shipments

19. International IECEE CB Scheme (1) Largest international certification scheme Concept is “one product, one test, one mark” 45 member bodies, 58 NCBs, 200+ CBTLs Now includes product category - EMC Option to include production surveillance (CB- FCS – Full Certification System) CB Scheme: www.iecee.org or www.cbscheme.comwww.iecee.orgwww.cbscheme.com

20. International IECEE CB Scheme (2)

21. International IECEE CB Scheme (3)

22. International IECEE CB Scheme (4)

23. International IECEE CB Scheme (5)

24. International IECEE CB Scheme (6) 1.China (21110) 2.Japan (4169) 3.Taipei (3748) 4.Korea (3679) 5.USA (3411) 6.Malaysia (2117) 7.Thailand (1881) 8.Italy (1790) 9.Germany (1705) 10.Indonesia (1325)

25. And so what does this mean …… ? Summing up

26. Global market access – Flat world China – Outsourcing with a capital “O” Internet – The equalizer CB scheme – 10+% growth year over year New requirements – Continuously changing regulations the world over

27. Contact Information Grant Schmidbauer Nemko North America, Inc. 11696 Sorrento Valley Road San Diego, CA 92121 USA Tel: 858-755-5525 Ex. 208 Fax: 858-452-1810 Email: grant.schmidbauer@nemko.com Website: www.nemko.comgrant.schmidbauer@nemko.comwww.nemko.com