September 20238 min read
EPR Local Authority Waste Management Costs for Household Packaging
As we advised in our August edition of Compliance at a Glance, the payment of fees for local authority household waste packaging collection costs has been delayed for a year. Defra advised this was to avoid adding to inflationary pressure at this time and to provide the additional time needed to consider the design of the modulated fees that will be applied to the amounts payable in the second year of EPR implementation. Defra has recently held a webinar on the design of modulated fees, which we have summarised below for those of you that did not attend:
- All producers of household packaging will have to finance their share of costs incurred by Local Authorities in providing efficient and effective services for the collection of household packaging waste and for the treatment of the packaging content of residual waste.
- The total Local Authority costs in any given year will be divided by the tonnage of household packaging placed on the market in that year to calculate the base fees.
- Base fees will first apply to packaging supplied in the 2024 calendar year (payable in 2025/6), with base fees being subject to modulation for packaging supplied in 2025 onwards (first payable in 2026/7). Modulation means that the base fees will be adjusted up or down as appropriate to incentivise producers to use packaging materials that can be easily recycled.
- Ultimately base fees will be modulated on recyclability, which will be determined from Defra’s “Recyclability Assessment Methodology Project (RAM). Since the methodology for determining recyclability will take time to develop, in the first year of modulation, base fees will be modulated using a different methodology as determined through Defra’s Modulated Fees (early years) Project.
We have provided a copy of a slide from Defra’s presentation that demonstrates the interactions between each of these projects. We understand that there will be opportunities to input into both projects and we would encourage our members to do this.
Defra communication timelines
- January 2024 – advise which materials will be subject to modulated fees in 2026 (packaging supplied 2025)
- July to September 2024 – publication of RAM, which will advise of modulation in 2027 (packaging supplied 2026)
Packaging data reporting requirements
In this section we advise of data reporting requirements which have recently been confirmed by the Environment Agency.
Under the current Data Reporting SI, the responsibility for reporting licensed packaging is dependent on whether that packaging was imported or pack/filled in the UK. The reporting requirements provided below have recently been confirmed by the Environment Agency.
Q. Who reports imported packaging bearing a brand which a licensee has license to use from a licensor?
A. The licensee reports this where they have imported these packaged goods other than on behalf of the brand owner. The licensee must report this packaging as “importer” as they are not the brand owner.
The only exception to this is with respect to annual nation of sale reporting when the licensee is not classed as a producer under the Regulations. In this case, the licensor is responsible for reporting certain packaging supplied by its licensee, which includes packaging associated with goods the licensee is obliged to buy, or packaging that they are obliged to buy, in both instances which bears a brand that is subject to the licence agreement.
Q. Does the nature of the licensor impact the reporting requirements?
A. No, the situation described above applies irrespective of whether the licence agreement was issued by a UK or overseas licensor. It also includes circumstances where a licence has been issued by an overseas parent (licensor) to a UK company within the same group if the UK company themselves is not the brand owner.
Q. Who reports packaging that is packed in the UK and that bears a brand which a licensee has license to use from a licensor?
A. The licensor is responsible. All branded packaging must be reported by the brand owner, with the sole exception of packaging that was not imported into the UK on their behalf.
Reporting Imported Branded Discarded Packaging
As we advised in our June issue of Compliance at a Glance, due to technical drafting issues in the Regulations both the Brand owner and the Importer are responsible for imported branded secondary and tertiary packaging that is supplied. We have since had another drafting issue, with respect to any imported branded packaging that is discarded, confirmed by the Environment Agency.
Q Who reports branded packaging imported by a third party on behalf of a UK brand owner which is discarded?
A. According to the Regulations, both the Importer and the Brand owner.
This is understood to be a consequence of a drafting error in the Regulations.
Whilst disposal of primary branded packaging is not an everyday occurrence for most REPIC members, this often happens with Brand owner return to vendor products. In such a situation, to sell the product, the importer may reconfigure it into a different brand, discarding the original imported primary packaging in the process.
We understand that it is too late for the Data Reporting SI to be amended, however, the policy intent is that the Brand owner should be responsible for all branded packaging imported on their behalf.
Deadlines approaching to have your say on draft EPR regulations.
As we advised in our August edition of Compliance at a Glance, Government is currently consulting on the draft EPR Regulation, which is available here. This is an important opportunity to ensure producer’s obligations are correctly reflected in the Regulations. Responses are required by 9th October 2023. We will be providing a summary of important issues to consider when preparing your response to this consultation in the coming weeks.
Defra Small Producer Survey
DEFRA is looking to get a better understanding of how EPR legislation is going to impact small producers, these are companies supplying between 25-50 tonnes or packaging or which have a £1 – £2 million turnover. They have developed a short survey, which should take less than 10 minutes to complete and is available at https://defragroup.eu.qualtrics.com/jfe/form/SV_9Haw3HVDA2ZFeya
If you are a small producer, we would encourage you to complete the survey to help Defra to understand the impact of the legislation on small producers and design future iterations of the Report Packaging Data survey to best suit their needs.
Important deadlines and actions that may affect you
EPR Report Packaging Data (RPD) Service
All large packaging producers (exceeding 50t packaging handled and £5m turnover in 2022) need to open an account on Defra’s RPD service.
If you are a REPIC Packaging Scheme Member – you should have provided your organisation ID to firstname.lastname@example.org by Thursday 31st August 2023.
Producers of EEE may also have Distributor / Retailer Obligations
If you sell household EEE products directly to the end user through your own retail stores / online then you will have Distributor Obligations, please take the time to read the guidance note that was attached to our REP-ACT-0241 email sent on the 22nd August.
The Office for Product Safety Standards (OPSS) conducts regular reviews of company websites to confirm compliance with distributor/retailer obligations. Our guidance note explains what you need to do to ensure your company is in compliance. Please contact us if you have any questions.
WEEE consultation survey
We are currently compiling a survey that will request information on product takeback, reuse, refurbishment and other circular business activities that your company undertakes. Our objective is to further inform our response to the forthcoming WEEE consultation and provide evidence in support of our policy proposals. Any information you provide will be treated as confidential and will be aggregated and anonymised unless we agree otherwise with you. We would appreciate your participation in our survey.