The newly introduced Waste Electrical and Electronic Equipment (WEEE) Directive will harm small, specialist manufacturers of IT equipment, an industry expert has warned.

Geoff Carr, of the National Association of Specialist Computer Retailers, said that many small retailers and manufactures could try to ignore the rules - which require companies to collect and recycle waste electronic equipment.

However, he added that it could also drive many firms out of business.

"There are going to be an awful lot of people who will stop building systems," he explained.

"A lot of smaller system builders are very specialised … and that's going to be lost, unless something is done about it.

"There's simply a difference between how smaller businesses will pay for it and how larger businesses will pay for it; it's just the economy of scale."

Mr Carr added that the concerns of these small producers needed to be addressed, or else the larger manufacturers would get "exactly what they want on a plate".

A recent Connect survey found that the two major concerns about outsourcing services like IT support were 'loss of control' (56 per cent) and 'budget over-runs' (43 per cent).