Abstract: Used electrical and electronic products have entered a peak period in China. According to statistics, the amount of annual scrapped electrical and electronic products is about 50 million to 80 million units, average annual growth is 20%, to the end of the Twelfth Five Year Plan, the amount of annual scrapped electrical and electronic products will exceed 160 million units. Wasted electrical and electronic products have become a urgent challenge for China and the world.Based on "processing funds collection management approach of wasted electrical and electronic products", electrical and electronic products manufacturers require to pay dismantling funds, dismantling enterprises get dismantling subsidies, closed-loop supply chain system is changed as policy changes. But now, the processing funds and the dismantling subsidies are not considered in analyzing closed-loop supply chain model. Based on this, the processing funds and the dismantling subsidies are introduced to the electrical and electronic products closed-loop supply chain model in this paper, under three kinds of recovery mode, from the perspective of dismantling qualification, models are constructed respectively, using game theory, manufacturers' dismantling strategy is analyzed for each type of recovery mode. By comparing the three recovery modes, it is found that, if f<H_t, then regardless of the recovery mode, manufacturer who has dismantling qualification can get extra income from reverse recovery channels. If H_t< f< H_m, then it is beneficial for manufacturers to apply for the dismantling qualification on manufacturer recycling or retailer recycling, on the contrary, manufacturers cannot maximize its profits by applying for the dismantling qualification on third-party recycling. If H_m< f< H_r, then manufacturers who have dismantling qualification can increase their profits on retailer recycling, manufacturers' optimal strategy is to deal with the dismantling process by the dismantling companies on manufacturer recycling or third-party recycling. If f>H_r, then regardless of which recovery mode, handling the dismantling process by the dismantling companies is manufacturers' optimal strategy. For manufacturers who have dismantling qualification, retailer recycling is manufacturers' optimal strategy under decentralized decision. Under collaborative decision-making, iff>H_Σ, system earnings is declined when manufacturer makes the application of dismantling qualification. If f<H_Σ, then the manufacturer applying for the dismantling qualification can increase system earnings.Therefore, supply chain system may is still not stable under collaborative decision-making. So, manufacturers who have dismantling qualification should increase recovery efforts level, and ensure recovery rates is not less than the value of unit processing funds divided by unit subsidies, the manufacturer who has not dismantling qualification should measure the competitiveness of recycling channels, and then decide whether to apply for dismantling qualification. These conclusions provide theoretical support for government departments to develop subsidy policies. Finally, a examples is given to prove the conclusions.

Key words: closed-loop supply chain, dismantling qualification, processing funds, recovery mode