Based on environmental policies of pollution prevention, continual improvement, and compliance with environmental laws and international treaty standards, Acer is aggressively promoting the development of environmentally friendly product designs in hopes of becoming a leading environmental advocate. The HSF Plan was created based on prevention principles, and sets the objective of substituting all hazardous substances with safer alternatives in all of our products.

In response to international trends and requirements from interested parties and clients, the first phase of the HSF Plan puts a priority on finding substitutions for PVC, BFR and phthalates in hazardous substance free designs. The key factors for alternative substances is that they must not detrimentally influence new product quality, safety, and reliability, and they must not endanger human health or pose worse environmental impacts. Acer pledges to prohibit PVC, BFR and phthalates from use in all new Acer products by 2009.

HSF Plan Implementation

To achieve the target to prohibit PVC, BFR and phthalates from use in all new Acer products by 2009, We cooperate and coordinate efforts with a network of suppliers and major component manufacturers to systematically implement our HSF Plan. We are now establishing baseline data for PVC, BFR and phthalates by maintaining updated inventories for the usage status of PVC, BFR and phthalates in all our products. This measure will help our products become more environmentally friendly. We have also sought technological assistance from professional environmental organizations to integrate the qualities of environmental protection and product manufacturing technology. In this way we hope to achieve our goal for all our products to be safe, and free of hazardous substances in the shortest time possible.

Since the beginning of 2005, Acer has been engaged in professional technology consultation and cooperation with Industrial Technology Research Institute (ITRI), Taiwan Printed Circuit Association (TPCA), and other professional technology organizations.

• Industrial Technology Research Institute (ITRI)
  ITRI is Taiwan’s largest applied research organization possessing a broad range of industrial technology fields, and accumulating many years of extensive specialization in the fields of environmental technology and plastics materials development. ITRI has also successfully assisted Taiwan’s electronics manufacturing industry to comply with green electronics control regulation standards set by EU nations (such as RoHS and WEEE). We have therefore sought ITRI’s consultation and assistance on specialized technology to help implement our HSF Plan. We believe that cooperation with ITRI will be able to provide Acer and its suppliers with the necessary technical consultation and assistance to successfully apply alternative technology for PVC and BFRs and ensure product reliability in the future.
  
  
• Taiwan Printed Circuit Association (TPCA)
  Acer became a member of the Taiwan Printed Circuit Association in 2006 to better understand the environmental impact of BFRs and their use in printed circuit boards and the potential alternative technologies available in the future. Acer also engaged in exchanges with association members to understand and influence the potential timeframe for application of printed circuit board alternatives.
  
  Acer is a member of the TPCA and will be an active participant in the association’s Printed Circuit Board (PCB) Standard Research Committee established on January 10th, 2007. In coordination with all levels of the industry as well as research experts, efforts will be made to collectively promote the inclusion of Taiwan’s PCB sector in international standard agreements and relevant international conferences. Acer will continue to act in the capacity as an established brand company to meet the demands of end users through incorporating new standards into our finished products.
  
  
• United States Environmental Protection Agency (EPA)
  To better understand the developmental tendencies in the international Design for the Environment (DfE), Acer has become an active participant in the United States Environmental Protection Agency’s (EPA) Flame Retardants in Printed Circuit Boards Partnership plan. This will help us stay abreast of current developments and standards in PCB environmental design.
  
  On January 11th, 2007, Acer began taking part in the United States EPA DfE/PCB multi-party conference call of how to carry out various types of accidental condition burn testing on PCBs, bare-boards and populated boards. The tests are performed to ascertain any possible occurrence of hazardous pollutants as well as understand the possible dangers of accidents involving PCBs in various circumstances. The conference call will in principle be conducted on a monthly basis; Acer will take part in discussions and offer suggestions to all parties involved. A more detailed account of the content of this plan can be found on the following website: http://www.epa.gov/dfe/pubs/projects/pcb/index.htm
  

• Other Professional Organizations
  Acer stays abreast with developments in related information technology and has broadened its understanding of plastic alternative technology and industry operations from its association with the Plastics Industry Development Center (PIDC). Additionally, Acer is committed to participating in conferences held by environmental groups such as the Sustainable High-Tech Workshop held on January 23rd, 2007. We are also devoted to communications with such groups as SVTC, Greenpeace and various Taiwan-based environmental protection groups.

Results of Present Phase of Implementation

Since its inception in 2005, the HSF Plan with the guidance of ITRI technology has completed a number of missions. These include the inspection of PVC, BFR and phthalate conditional use and technology evaluations, system and important component supplier operations, data analysis and review evaluation, establishment of an HSF database and regular disclosures of HSF Plan progress.Furthermore, we have visited the manufacturers in the supply chains, including plastic materials, CCL, PWB, cables and wires in order to understand the status of the substitution technologies. So far, most of the housing and mechanical parts do not contain PVC, BFRs, and phthalates; the technologies for BFR-free PWB are becoming more popular and mature. The majority of the substitution materials for BFRs are phosphates, but the inherent moisturizing, hardening and fragility are the major drawbacks of the substitution. The drawbacks will possibly interfere with the safety and reliability of the products, thus safety and reliability tests are undertaken. The mass production will be limited by the supply of the bromine-free resin for PWB; the technologies for non-PVC cables and wires are emerging, especially those for direct current applications. Few alternating current applications of non-PVC cables have been developed and been under certification for safety requirements.

• Cooperation with Suppliers
  On August 15, 2007, Acer met with 45 suppliers and 118 representatives to deliver and communicate the status of HSF inventory, supplier performance, further environmental requirements for products, Carbon Disclosure Project (CDP), greenhouse gas emission and inventory, EuP and Electronic Product Environmental Assessment Tool (EPEAT) which will be followed up in the near future.

• Technology Assessment
  Our first step is to better understand the use of PVC, BFR and phthalates, and assess the feasibility of eliminating their use. Following research and studies, we discovered that the majority of PVC, BFR and phthalates used in our current products are contained in the plastics materials of mechanical components, printed circuit boards, and wiring (see Technology Assessment Results). Our preliminary technology assessments show that our commitment to eliminate PVC, BFR and phthalates in all new Acer products will be actualized by 2009.
  
  
• Inventory Procedures
  In early 2006, Acer began carrying out inventory studies of its suppliers’ usage of PVC, BFR and phthalates. Explanatory briefings were held inviting participation of systems and major component suppliers. The goal of these explanatory meetings was to clearly explain Acer’s objective and resolution in implementing the HSF Plan and declare our pledge to eliminate the use of PVC, BFR and phthalates within a specified timeframe. We also provided a detailed explanation of the inventory procedures to encourage cooperation from suppliers.
  
  
• Result Analysis and Evaluation
  Carrying out results analysis on system and important component suppliers requires the use of X-ray fluorescence (XRF) testing in order to ensure the accuracy of inspection data and carry out a comprehensive substitute material schedule review and evaluation.
  

• Establishing the HSF Database
  Working to more efficiently access information on hazardous chemical substances used by our suppliers and products, Acer took the initiative to establish the HSF databank. This step further tightened the links in the Acer green supplier chain system. In our efforts to follow-up on HSF product development, we will utilize inventories and provide technology assistance to upstream suppliers to gradually eliminate components containing hazardous chemical substances from Acer’s purchasing system.
  
  
• Disclosing Information on HSF Implementation Initiative
  Acer takes the initiative to ensure that its products are safe and feels it has an obligation to disclose corporate information. Acer’s corporate website discloses results of HSF Plan implementation for each quarter, allowing clients, suppliers, and interested parties to find out about the results of Acer’s HSF Plan.