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FAQs - Packaging Extended Producer Responsibility regulations

Background and why do we need it?

What is packaging EPR?

Packaging extended producer responsibility (packaging EPR) places obligations on producers who place packaging on the market to ensure material is managed properly at end-of life. This may require changes to the design of packaging, inclusion of consumer labels, financial costs of collection and sorting infrastructure, monitoring and evaluation of material in the supply chain, communication activities and more.  

The current UK scheme requires obligated producers to purchase of Packaging Waste Recovery Notes (PRN’s) or Packaging Export Recovery Notes (PERN’s), sold by organisations that reprocess packaging, which provide evidence that a proportion of packaging similar to the types used in their products, has been recycled. The price of PRN’s varies subject to market conditions but has typically resulted in producers paying a small proportion of the costs associated with managing packaging at the end of its life.  

The new packaging scheme will require producers to pay the full net cost of treating packaging that they place on the market and has the potential to incentivise other changes such as better packaging design and preventing waste at source. Changes to who is responsible for compliance, labelling requirements, scheme governance, export requirements, and reporting and data requirements are also proposed. 

Which other countries operate a packaging EPR?

Packaging EPR is one of the most common forms of EPR around the world. The majority of EU member states have schemes, in order to comply with EU Directive 94/62/EC, but there are also schemes in other countries and regions around the world. Packaging EPR globally takes a wide variety of forms, but typically producers are responsible for collecting, sorting and either recycling or disposing of the waste from households and commercial and industrial sources. Producers can fulfil these obligations directly, or by paying a third party to facilitate the obligations on their behalf.  

Revisions to the Waste Framework Directive (2008), introduced new requirements for EPR schemes, requiring producers to cover the entire cost of waste management for the products they place on the market. This includes costs relating to collection, sorting and treatment of the waste, as well as funding information campaigns and data gathering and reporting. 

Why is a new packaging EPR scheme being introduced?

The current packaging EPR scheme uses Packaging Waste Recovery Notes (PRNs) whereby producers buy sufficient PRNs in order to offset their obligations using the ‘producer pays’ principle. It is estimated that this amounts to around 10%, on average, of the total costs of managing packaging waste at end-of-life.  

Producers do not currently pay the full costs associated with the material that they place on the market. This means that Local Authorities and society as a whole must bear the majority of the financial cost of dealing with packaging materials at the end of their useful life. In addition, although the money raised by PRNs is intended to improve packaging waste management it is often unclear whether this is the case.  

As the price of PRNs is not linked to the recyclability or environmental impacts of the materials, the current system does not incentivise improvements in packaging design or penalise the use of materials that are difficult to recycle. This means that materials are often reprocessed into much lower value goods or lost to landfill or incineration after just one use.  

There is also a lack of transparency about the actual fate of materials, especially when they are exported for reprocessing in other countries. This means it is difficult to tell if materials are being handled responsibly.  

The new packaging EPR scheme will help to reduce these issues, as well as driving a shift towards a more circular economy, ensuring that materials are used for longer, and reprocessed to higher value use. 

Why is packaging EPR a UK-wide scheme?

The Producer Responsibility Obligations (Packaging Waste) Regulations 2007 (as amended) have been in place since 1997 and operate UK-wide. While producer responsibility and waste policy are devolved matters, the UK Government (acting for England) and the Devolved Administrations of Northern Ireland, Scotland and Wales have agreed to continue with a UK-wide approach to packaging EPR. 

The governments of all nations are working together to ensure that the new packaging EPR scheme aligns with existing policies as far as possible, and allows some variation based on local needs and priorities. 

What are the benefits of a packaging EPR scheme?

There are a number of benefits of the new packaging EPR scheme as outlined below: 

As well as environmental outcomes, broader scheme outcomes for packaging EPR have also been identified:

  • That there is additional reprocessing capacity available in the UK to handle the increasing quantities of packaging waste that will be available for recycling; 
  • That the system for managing packaging waste becomes more efficient and effective in delivering the environmental outcomes;
  • That people’s knowledge of the packaging they can and can’t recycle increases and it is easier for them to recycle. 

Where can I have my say?

The Scottish Government, along with the UK Government, the Welsh Government and the Department of Agriculture, Environment and Rural Affairs (DAERA) in Northern Ireland launched a second stage consultation in March on introducing a UK packaging EPR scheme. The consultation is open until the 4th June. You can formally respond to the consultation here

What will the scheme look like?

What packaging is included in the regulations?

The consultation proposal extends to all types of packaging used in relation to the distribution and supply of products that are placed for sale on the UK market, both single-use and reusable packaging.  

The scheme will cover packaging waste that arises in households as well as household-like, commercial and industrial packaging that comes from public sector premises, and retail, hospitality and other commercial and industrial premises.  

What packaging is excluded from the regulations?

Drinks containers that are in scope of Scotland’s deposit return scheme which are made of PET plastic, glass, steel and aluminium are not in scope of packaging EPR. Drinks containers that are in scope of the England, Wales and Northern Ireland deposit return scheme will be confirmed following a separate consultation on a deposit return scheme for England, Wales and Northern Ireland.  

While the drinks containers included in the deposit return schemes themselves are not in scope of packaging EPR, all other packaging associated with the distribution and sale of these items in the UK is in scope of packaging EPR. This could include multipack plastic wrap and secondary and tertiary packaging.  

What is the definition of packaging in terms of these regulations?

The definition of packaging will not change under the new regulations. Packaging is defined as “all products made of any materials of any nature to be used for the containment, protection, handling, delivery and presentation of goods, from raw materials to processed goods, from the producer to the user or the consumer. Non-returnable items used for the same purposes shall also be considered to constitute packaging”. 

Packaging is defined as consisting of: 

  • Sales packaging or primary packaging;
  • Grouped packaging or secondary packaging; 
  • Transport packaging or tertiary packaging. 

Additional types of packaging or packaging material may need to be defined in the Extended Producer Responsibility regulations. 

Are single-use cups included?

Single-use disposable cups are included in the scope of packaging EPR. Currently, there are a range of voluntary schemes in place to provide recycling services, but many cups can only be recycled if they are taken to specialist facilities. This generally does not happen if cups are mixed in with other materials at the point of collection, so cups are often sent to landfill or incinerated.  

Interplay with DRS

What is the interplay between packaging EPR and a Deposit Return Scheme (DRS)?

Scotland’s Deposit Return Scheme (DRS), where a small deposit will be charged on drinks containers to incentivise their return to a collection site, is also a form of EPR. The Deposit and Return Scheme Scotland Regulations were passed by the Scottish Parliament in May 2020. The “go live” date for the scheme is July 2022. The scheme will improve recycling rates, increase the quality of recycling materials and significantly reduce litter.  

Scotland’s DRS and the DRS for England, Wales and Northern Ireland will be complementary to the UK-wide packaging EPR scheme. Producers will not pay twice for these containers. Both DRS and packaging EPR will drive higher capture and recycling rates by obligating producers to achieve a more circular economy.  

Will producers have to pay for drinks containers twice?

Drinks containers that are in scope of Scotland’s DRS are not in scope of packaging EPR hence producers of these products will not pay twice for these containers.  

While the drinks containers included in the deposit return scheme themselves are not in scope of packaging EPR, all other packaging associated with the distribution and sale of these items in the UK are in scope of packaging EPR. This could include multipack plastic wrap and secondary and tertiary packaging.  

Why is the de minimis level for Scotland’s DRS different from the one for packaging EPR?

Under Scotland’s DRS all drinks producers and importers, regardless of size, who sell onto the Scottish market are covered by the legislation. The current packaging producer responsibility scheme includes a de minimis and Government have indicated in the consultation that the new packaging EPR scheme will also have a de minimis.  

This means that the approach to de-minimis levels for packaging EPR will not align with that of deposit return schemes in the UK or with the Plastic Packaging Tax. Government outline in the consultation that this is because the de-minimis threshold for the Plastic Packaging Tax and the deposit return schemes have been designed for a narrower range of materials and types of packaging and therefore a smaller number of businesses. 

Targets

What is the recycling target for packaging EPR?

Packaging recycling targets will be set for packaging that is obligated under the EPR scheme. The consultation proposes minimum recycling targets for six packaging materials. These equate to an overall recycling rate of 73% by 2030. 

It is anticipated that by 2030 with a combination of measures including the new EPR scheme and deposit return schemes the overall UK packaging recycle rate will be 78%. 

What materials will have specific targets and why do the targets differ by material?

Under the new scheme targets will be placed on the following packaging materials: plastic, wood, aluminium, steel, paper/card and glass. A fibre-based composite packaging target is also being considered along with a target for reuse and a closed loop target.  

Material specific targets will prevent cross-subsidisation with the different rates taking account of the packaging formats present for that material. 

Why do we need nation-level accountability? Will producers need to meet higher recycling targets in individual nations?

Government will separately report overall packaging waste recycling rates for England, Scotland, Northern Ireland and Wales which will reflect total packaging recycled.  

While the EPR scheme will operate UK-wide, producer responsibility and waste policy are devolved matters. As such recycling targets will need to be reported on and met in England, Scotland, Wales and Northern Ireland.

Why is a fibre-based composites target being considered?

Currently the collection and reprocessing of disposable paper cups and other fibre-based composites is limited due to the costs associated with collection, sorting capacity and challenges around the reprocessing of this material type. There is currently no economic incentive to recycle this packaging.  

The consultation therefore proposes the introduction of a recycling target for fibre-based composite packaging (laminated paperboard; either single-sided plastic laminate or two-sided plastic laminate and the packaging may include other material such as aluminium foil) to drive the collection and recycling of this material type. Currently this material is categorised as paper for the purposes of Packaging Recovery Notes. A separate target will provide an incentivise for a significant packaging element that can often contaminate other material streams. 

Why are reuse targets not being introduced earlier?

Closed loop recycling targets will help to drive quality in recyclable materials and encourage greater use of recycled materials in equivalent closed loop applications. It is proposed that the wider EPR scheme is introduced with the core recycling targets as per scheme objectives so that time can be taken to understand the best method of implementing additional targets around reuse.  

Producer obligations

Who is obligated under packaging EPR?

Under the new scheme it is proposed that there are six types of obligated producers: brand owners, importers, distributors, online marketplaces, sellers and service providers. 

Placing the main point of obligation on brand owners will mean that the requirement to pay fees to cover the costs of managing packaging waste are placed on those with the greatest level of influence over decisions made at the design stage and in the choice of packaging they use for their products.  

Importers, distributors, online marketplaces, sellers and service providers also have obligations for some of the packaging that they deal with. Individual businesses can have more than one type of obligation. 

The proposed approach for small businesses is different. See below for more information. 

Why is there now a single point of obligation rather than shared obligation?

It is proposed that there is a single point of obligation (brand owners) under the new scheme. Placing the main point of obligation on brand owners will ensure that the requirement to pay fees to cover the costs of managing packaging waste, and the modulation of those fees, are placed on those with most influence over decisions made at the design stage and in the choice of packaging used on their products. 

As a producer what costs will I have to pay for?

The consultation proposes that the following costs will need to be recovered by packaging producers for household packaging waste:

  • Collection, sorting and recycling packaging waste from households;
  • Collecting and disposing of packaging in the residual waste stream from households;
  • Collecting, sorting and recycling household-like packaging waste collected from businesses;
  • Litter and refuse management costs.

Producers will also have to contribute towards other running costs of the scheme including regulator costs, scheme administrator costs and costs associated with national communications campaigns. 

What are the different types of obligation?

Under the new scheme brand owners, importers, distributors, online marketplaces and service providers will take on a waste management cost obligation. This means that these types of businesses will need to report the obligated packaging that they place on the market and pay fees to cover the costs associated with the management of the packaging waste.  

Importers (for some packaging), distributors, online marketplaces, sellers and service producers also take on an obligation to separately report packaging placed on the market in England, Scotland, Northern Ireland and Wales. This obligation will facilitate the tracking of progress to meet packaging waste recycling targets. Where a producer has this obligation only, they would not pay fees to cover waste management costs but would contribute towards administrative and regulator costs.  

There are additional obligations for labelling.  See below for more information. 

What obligations do online marketplaces have and why do online market places only take on the obligation for sales they facilitate from out with the UK?

It is proposed in the consultation that online marketplaces are obligated for filled packaging that is sold on the UK market via their platforms or websites by businesses based outside the UK. They must pay the fees to cover the costs of managing this packaging waste, along with other scheme costs.  

Sales via online marketplaces of packaged products from UK-based businesses are not included as it is anticipated that the vast majority of this packaging will already be obligated in the scheme. 

Online marketplaces may also have obligations if they are a brand owner.  

How are reporting requirements changing?

While some producers will take on a waste management cost obligation, others will take on an obligation to separately report packaging placed on the market in England, Wales, Scotland and Northern Ireland. 

Those with an obligation to cover packaging waste management costs will be required to report the tonnage of packaging that they are obligated for in the previous calendar year. This will be at a more granular level than it is currently.  

Those who have an obligation to separately report packaging placed on the market in England, Wales, Scotland and Northern Ireland will be required to report where they have sold packaging to the end consumer (sellers), sold unfilled packaging to unobligated producers (distributors), hired out reusable packaging (service providers), facilitated the sale of filled packaging via an online marketplace and for any packaging that has been imported but subsequently discarded in the UK before selling (importers). A de minimis applies to this obligation to avoid placing an unnecessary reporting burden on small businesses. Those with this obligation will report annually the tonnage of packaging they have placed on the market according to set packaging categories.  

Will evidence notes (Packaging Recovery Notes and Packaging Export Recovery Notes) still be required for producers to evidence they have met their obligations?

Packaging Recovery Notes (PRNs) and Packaging Export Recovery Notes (PERNs) will not be used under the new scheme as producers will pay modulated fees based on the waste management costs of packaging. 

Can I manage my own packaging waste? If so, how do I evidence that I have managed my own packaging waste?

Where a producer can show that they have arranged for their packaging waste to be separately managed then they will be able to offset an equivalent amount from their obligation, for similar packaging. An example of this would be transit and industrial packaging which a number of producers backhaul to waste distribution centres or self-manage as separate streams. This would be subject to necessary reporting, evidencing and compliance monitoring.  

Impact on small businesses

Is the de minimis changing?

Under the current scheme, producers with a turnover below £2M and who use less than 50 tonnes of packaging per year are exempt from reporting and evidence obligations. However, this means that a large quantity of packaging material is not included in the scheme. The consultation includes three potential options to obligate more packaging, while at the same time ensuring that the smallest producers do not have unnecessary reporting requirements.  

What is the new de minimis?

By changing the de minimis more packaging will be collected under the new scheme and be subject to the costs associated with packaging waste management. It will, however, be important to ensure that the smallest producers are not unfairly burdened.  

The consultation presents three options that could be used individually or together to obligate more packaging under the scheme. These options include lowering the current de minimis and/or obligating distributors, manufacturers or importers for packaging sold to businesses below the de minimis. Government has indicated a preference for the option where manufacturers and importers of unfilled packaging are obligated for the packaging that they sell to businesses who fall under the existing or a reduced de minimis. 

Disposable cups takeback obligation

What is the disposable cup takeback obligation and which cups are in scope?

It is proposed that a mandatory takeback requirement is placed on those businesses selling filled disposable paper cups. Such businesses will be required to provide a separate collection for used cups, generated both in-store and consumed ‘on-the-go’, irrespective of brand or where the drink was purchased. This may be through both instore and front of shop collection points. These businesses will also be required to arrange the collection and recycling of these cups. 

Will funding be provided for recycling infrastructure for paper cups?

It is anticipated that the disposable cup takeback scheme could provide the financial stimulus initially required for investment in collection and reprocessing and may reduce costs as economies of scales increase. 

What will the impact on small businesses be?

Including small businesses in the takeback obligation will make it easier for consumers to recycle their cups and contribute towards the fibre-based composite packaging target. Government is, however, looking to avoid placing a disproportionate burden on small businesses who may often be a single shop or very small chain business.  

Government is therefore considering whether such businesses should be permanently or temporarily exempt from this takeback requirement.  

A two-year exemption period is being proposed in the first instance to allow time for collection and reprocessing infrastructure to be developed and the business payment mechanism to be implemented. This could then enable the funding of this takeback requirement for small businesses through their suppliers and would align with the introduction of the fibre-based composite packaging target. If taken forward it is proposed that the exemption would be in line with the de minimis for obligated producers.  

Modulated fees

What are modulated fees and what do they mean in packaging EPR?

Modulated fees are used in some EPR schemes and mean that the fee a producer must pay for a particular type of packaging is dependent on the characteristics of the packaging. Modulation is intended to ensure that it is financially beneficial for producers to design their packaging to minimise environmental impacts.  

Under the new scheme it is proposed that the fees producers pay towards the management costs of their packaging is varied by their recyclability. Modulated fees provide an incentive for producers to design and use packaging that contributes positively to scheme outcomes (i.e. it is easily recyclable). This would mean that where a producer’s packaging positively contributes to scheme outcomes (i.e. it is easily recyclable) the producer pay a lower fee, whilst producers whose packaging does not contribute positively to scheme outcomes (i.e. it is unrecyclable) pay a higher fee. As a result, not all producers pay the same fee as they are varied depending on the packaging used.  

What will the fees be for each item of packaging placed on the market and what is the criteria for ‘recyclable’?

The consultation proposes that fee modulation should initially focus on recyclability. Producers will need to report whether their packaging is recyclable or not, with it being proposed that producers do this using a prescribed assessment methodology, reporting separately the tonnages of recyclable and non-recyclable material used.  

The Scheme Administrator is expected to develop or procure the assessment methodology on behalf of its members, providing producers with a common methodology to determine whether for individual items of packaging the combination of components, materials and design meets the recyclability criteria. 

Who will decide the modulated fees and how will they be determined?

The modulation of fees should be applied in a fair, proportionate and strategic way. The requirement to modulate the costs paid by producers would be set in the regulations. It is proposed that the approach to modulation and the fee rates that would apply to different types of packaging should be determined by the appointed value-chain led Scheme Administrator. 

Prospective scheme administrators’ will be required to set out their proposed approach to modulation as part of the process to appoint the Scheme Administrator. This will then form part of the contract with Government. 

What will the packaging format categories be?

Packaging format categories will be determined by the Scheme Administrator, once in place, and in consultation with the packaging value-chain. 

Labelling

Why is labelilng needed?

As consumers have a responsibility to dispose of packaging waste correctly it will be important to increase consumer knowledge of the packaging they can and cannot recycle. Mandatory labelling is a way in which this information can be conveyed to consumers. 

What labelling is required under packaging EPR?

Mandatory labelling will apply to all primary packaging, primary packaging that comprises of multiple components and all shipment packaging. Packaging items that are in scope of Scotland’s deposit return scheme and an England, Wales and Northern Ireland deposit return scheme are not in scope of mandatory EPR labelling. All secondary and tertiary (transit) packaging are also not in scope of mandatory labelling under the Extended Producer Responsibility regulations.  

The consultation proposes two approaches for how producers may meet their labelling obligations: by using approved labels or via a single labelling scheme.  

How will packaging be labelled?

The mandatory labelling requirement will be to label all packaging as “recycle” or “do not recycle”. Producers will assess the recyclability of their packaging to determine whether it is recyclable or not, which will determine both the label applied to the product and the modulated fees paid. It is recognised that producers will need time to adopt labelling requirements and that the ability to label packaging as recyclable will be dependent on the availability of collection, sorting and reprocessing infrastructure. 

The consultation proposes that binary labelling is adopted for most packaging by the end of financial year 2024/25. There may be some cases, where recycling infrastructure is poor, that it is not feasible to move directly to binary labelling. This will likely be the case for plastic films and flexible packaging where interim labelling solutions may be required. As such it is proposed that binary labelling is fully adopted by the end of financial year 2026/27 consistent with the timeline proposed for the rollout of collection of plastic films and flexibles packaging. 

Who is responsible for labelling requirements and is there a de minimis?

Producers offering packaged products for sale in the UK will be obligated to comply with mandatory labelling requirements.  

Labelling is intended to apply to as much packaging as possible. As such, producers over the de minimis will need to label their products following a recyclability assessment. Those under the de minimis will not be required to label their products, instead the preferred option is that the manufacturers providing packaging to small producers labels the materials, therefore taking on this obligation. 

I sell to small businesses – what are my labelling obligations?

In general, it will be the business who places packaged products on the UK market who will be obligated to comply with mandatory labelling requirements. However, to prevent this being a significant burden for small or micro-businesses it is proposed that in these cases the business who sells unfilled packaging directly to small producers picks up this requirement. The preferred proposal is that manufacturers fulfil this obligation on behalf of small businesses.  

Compostable and biodegradable packaging

How is compostable and biodegradable packaging treated under packaging EPR?

There are a number of challenges associated with the use and management of compostable and biodegradable packaging. Evidence suggests that this material does not always biodegrade in the open environment and can leave behind microplastics. The number of facilities that accept these materials at end of life is also limited and they can cause consumer confusion.  

As such compostable and biodegradable packaging would be considered as not recyclable under packaging EPR. This packaging would therefore attract higher fees (as a result of modulated fees) than other packaging that contributes positively to scheme outcomes. As a result, these items would be labelled as “do not recycle”. Some of these products, where used in ‘closed loop’ venues may be subject to an exemption. 

Films and flexibles

Are plastic films and flexibles included in packaging EPR and when will plastic film collections be introduced?

Plastic film and flexible packaging make up a third of the 2.4mt of plastic packaging placed on the market annually in the UK.  

The consultation proposes the introduction of collections and recycling for all films and flexibles by the end of financial year 2026/27, with collections from businesses being introduced no later than the end of financial year 2024/25. 

How will plastic film and flexibles be collected?

The consultation outlines that obligated producers for plastic films and flexibles will be expected to fund the necessary investment to allow for collection and recycling. Front of store recycling points for plastic films and flexibles will provide a way to make early progress and provide consumers with the opportunity to recycle certain types of films and flexibles until kerbside collections are fully implemented. 

Payments for managing packaging waste

What costs do producers have to pay for under packaging EPR?

Under the new scheme producers are obligated for the necessary costs of efficient and effective waste management services for packaging.  

They include: 

  • Operational costs to collect, manage and dispose of packaging waste;
  • Support costs in achieving scheme outcomes and targets, including communications.  

Additional costs may also arise at the discretion of the Scheme Administrator or compliance schemes, where necessary to achieve scheme outcomes and targets, improve efficiency or reduce longer term costs for producers.  

The appointed Scheme Administrator will be responsible for determining the approach to payments to local authorities for household packaging waste.  

How are efficient and effective services defined?

It is proposed that payments to local authorities of necessary costs should reflect services designed and delivered around good practice and a reasonable benchmark of cost and performance of comparable authorities. 

Under the new scheme producers should not be expected to pay for poorly designed or implemented services.  

In establishing necessary costs of efficient and effective schemes, costs should fairly account for geographic, socio-economic and other factors that impact on cost and performance.   

How are costs for efficient and effective schemes established?

A modelled cost approach would seek to establish for each local authority a benchmark cost for managing packaging waste based on the adoption of good practice in the design of their collection scheme, the effective delivery of that service, and the achievement of results that are comparable to relevant peer authorities. It would include housing number and type, cost and performance data, and also takes into account cost drivers such as geography, rurality and levels of deprivation. 

Who owns the material under packaging EPR?

Local authorities will continue to own the material collected. Where they sell this material onto a reprocessor they will receive income from its sale. Local authorities who contract with recycling facilities will continue to pay gate fees, with the value of the materials being accounted for in the gate fee.  

Reference material prices, based on market data, will likely be established for each of the core materials and applied to the benchmark service costs.  

Local authority payments for services are net of any income from sale of materials. Local authorities will therefore be incentivised to improve the quality of the material they collect as they will benefit financially from greater quality material.  

Will material quality be improved under EPR?

Avoiding the loss of material quality at each stage in the scheme will be important in reducing costs and increasing the circularity of the packaging scheme. Measures to increase material quality include infrastructure investment, effective services, better monitoring throughout the chain and more informed consumers as a result of labelling and communication initiatives.  

How will business waste collections work under EPR and who pays for them?

Producers will be responsible for the costs of packaging waste recycling collections from businesses.  

The consultation proposes three options for payments for packaging waste collections from businesses and other relevant organisations as outlined below: 

  • Scheme Administer led, producer funded, business packaging waste management cost rebate system;
  • Compliance scheme led, producer funded, business packaging waste management cost rebate system;
  • Compliance scheme led, producer funded, ‘free bin’ approach.   

Under the first two options businesses disposing of packaging waste would receive a rebate from producers for recycling, resulting in a heavily discounted or free packaging waste collection service. In both options the Scheme Administrator would set a per tonne rate. The main difference between these two options is who pays the waste collectors this rebate, the Scheme Administrator or a compliance scheme.  

Under the third option all businesses would be entitled to free collections for packaging waste, with those waste collectors who offer packaging waste collections to businesses providing a ‘free service’ to the business for their packaging waste. Producers would have an obligation to fund this service via compliance fees entering into commercial arrangements with waste collectors to provide the collection service. 

Litter payments

Who is obligated for litter payments?

As litter falls within scope of the full net cost of managing packaging waste, producers will be responsible for litter payments. Making producers responsible for packaging litter costs will place a clear incentive for them to take steps to reduce the occurrence of their packaging in the litter stream.  

There is a need to ensure the costs of managing packaging waste in different contexts are paid by relevant producers. Government considered three options regarding the waste management obligation for cleansing. The preferred proposal is that those producers with packaging present in the litter stream are obligated for the waste management costs. This would be determined by compositional studies. 

Why is litter in-scope for producer payments when it is caused by poor individual behaviour?

Keeping litter in scope of full net costs ensures that it aligns with the polluter pays principle, overarching scheme outcomes and objectives, reducing the amount of packaging littered, increasing the amount of ‘on-the-go’ packaging recycled or reused and, ensuring that producers cover the costs associated with packaging disposed in the litter stream. 

This takes account of the fact that it is producers, not local authorities, who benefit from the sale and on-the-go consumption of their products. Making packaging producers responsible for packaging litter costs will place a clear incentive on them to take steps to reduce the prevalence of their packaging in the litter stream. 

What costs are in-scope for litter payments?

It is proposed that producers bear the costs of managing littered packaging currently borne by all publicly funded organisations with a duty to keep land clear of litter and refuse.  

Given the mobile nature of littered packaging and the impact it as on the environment, the consultation specifies there is a case for producers to contribute to the costs of litter management on other land that is publicly accessible. As such the preferred option is for producer payments to contribute to costs incurred by charities, not for profit organisations and representative bodies for prevention and educational activities, litter picks, and “binfrastructure” on land that is accessible to the public free of charge through a ‘litter fund’ for each nation.  

Who receives litter payments?

It is proposed that producers bear the costs of managing littered packaging currently borne by all publicly funded organisations with a duty to keep land clear of litter and refuse.  

Given the mobile nature of littered packaging and the impact it as on the environment, the consultation specifies there is a case for producers to contribute to the costs of litter management on other land that is publicly accessible. As such the preferred option is for producer payments to contribute to costs incurred by charities, not for profit organisations and representative bodies for prevention and educational activities, litter picks, and “binfrastructure” on land that is accessible to the public free of charge through a ‘litter fund’ for each nation.  

How will litter payments be determined?

Key costs drivers are likely to include factors such as footfall, rurality and deprivation. The Scheme Administrator will develop a mechanism for litter payments that takes account of these and other relevant factors.  

Scheme administration and governance

What is a scheme administrator and who owns and operates it?

Under the new scheme, a Scheme Administrator should be a not-for-profit organisation that is owned and operated by the value-chain. The functions of the Scheme Administrator would be established in the Extended Producer Responsibility regulations. The Scheme Administrator would determine how best to fulfil its functions and achieve outcomes and targets in the most-cost effective manner. Their approach to meeting this objective would be set out in a contract with Government. 

What are the options for scheme governance?

The consultation outlines two approaches to scheme governance. The first option is a Single Management Organisation / Scheme Administrator, appointed jointly by the Ministers of each administrator, which would be responsible for managing and administrating the packaging EPR scheme on behalf of producers. The second option would involve a Scheme Administrator and compliance schemes. Under this option the delivery of the EPR scheme would be managed through both a Scheme Administrator and mandatory memberships with compliance schemes. The Scheme Administrator would take responsibility for functions that are best managed on a UK-wide basis such as local authority costs and benchmarking and modulated fees whilst compliance schemes would be responsible for payments for management of waste from businesses. 

Why is there not a preferred option by this point?

Governance and administration arrangements need to meet the principles established for packaging EPR and support producers in complying with their obligations. While Government has not identified a preferred approach to scheme administration and governance, the consultation is seeking feedback on the two approaches proposed.  

Government is of the view that there are certain functions which are more suited to being managed on a UK-wide basis rather than via multiple compliance schemes. 

What is the role of compliance schemes under a single Scheme Administrator scheme?

Under the option for a single Scheme Administrator, producers could employ the services of experienced companies to assist with their data management and reporting. This may take a similar format to the services currently offered by compliance schemes. However, compliance schemes would not be required by the Extended Producer Responsibility regulations.  

What happens if the Scheme Administrator doesn’t meet its targets?

Holding the Scheme Administrator accountable for its performance will be essential to the success of the scheme. The Scheme Administrator will be accountable to its producer members on whose behalf it is acting, via contractual obligations with Government and through the Extended Producer Responsibility regulations. 

Under its contract with Government the Scheme Administrator will have annual reporting requirements, with Government also likely putting in place monitoring arrangement and key performance indicators. A range of enforcement actions will also be available to the regulators under the Extended Producer Responsibility regulations.  

When will the Scheme Administrator be in place?

The appointment of the Scheme Administrator will be through an open competitive process. The Scheme Administrator would need to be appointed and operational in 2023 to enable roll out of Phase 1 of EPR from 2023. This would require the Scheme Administrator to have mobilised and to have established the systems and processes required to raise costs from producers and make payments to local authorities. The process for appointing a Scheme Administrator is anticipated to start in the autumn of 2021, subject to parliamentary approval of the Environment Bill. 

Reprocessing and exporting

Will there be changes to reprocessing and exporting?

Under the new EPR scheme there will be an improvement to the quality of materials being made available for recycling. This coupled with proposals requiring those who receive payments for managing packaging waste to provide evidence that the packaging waste they have collected and/or sorted has been recycled means that Packaging Recovery Notes (PRNs) and Packaging Export Recovery Notes (PERNs) will no longer be required.  

What export issues does the new scheme address?

The UK Government has committed to introduce additional measures to tighten controls on waste exports. The scheme will require a better understanding of the amount of packaging that is collected and reprocessed as well as the quality of packaging materials as they move through the waste management scheme. 

Under the new scheme additional points along the value chain will be required to capture data and provide proof of recycling/reprocessing in support of payments. This will mean that there will be a measurement of recycling that represents the weight of packaging waste after sorting and removal of contamination prior to reprocessing. At this point ‘proof of recycling’ will be required for reporting against targets. Additional reporting points will provide more certainty that waste presented for reprocessing is of a broadly equivalent standard and help to ensure that packaging waste that is exported is of the same or similar standard to that which is reprocessed in the UK. The UK Government has also committed to introduce additional measures to tighten controls on waste exports, with a separate consultation on these reforms planned.  

Compliance and enforcement

Who will regulate the scheme?

Most provisions in the Extended Producer Responsibility regulations will be enforced by the environmental regulators. In Scotland this will be the Scottish Environment Protection Agency (SEPA).  

Regulations would operate as they currently do, whereby each regulator is responsible for enforcing the regulations for the obligated parties based within each of their areas. 

The most appropriate regulator for mandatory labelling, the mandatory cup takeback obligation and packaging product requirements on producers is still being considered.  

How will regulators interact with a Scheme Administrator?

Oversight of the Scheme Administrator will be through regulatory activity undertaken by the regulators as well as through contractual agreements with Government. 

The Scheme Administrator will be responsible for the operation of all, or part, of the scheme and have obligations to report performance data and meet statutory recycling targets across all parts of the UK. These obligations will be monitored and enforced by the relevant environmental regulator.  

What enforcement actions are proposed?

Under the Extended Producer Responsibility regulations, the regulators will have a range of enforcement response options. These may take the form of civil sanctions as well as other enforcement response options available to manage non-compliance. 

Implementation timeline

When will the new packaging EPR scheme be in place?

The new scheme is proposed to be implemented in two phases. Phase 1 will begin in 2023 while Phase 2 will start in 2024. Phase 1 will include the mobilisation of the scheme administrator and the first payments being made to local authorities. Phase 2 will see the introduction of other key elements including payments to local authorities for the full costs of managing household packaging waste, payments for the management of litter and payments to businesses for the cost of managing packaging waste. Further stages would see the introduction of reuse and closed loop targets, collections for films and flexibles and introduction of the mandatory cup takeback. 

Why is a Statutory Instrument needed?

In Phase 1 the focus for the Scheme Administrator would be to establish the process to raise fees from producers to enable payments to be made to local authorities for the management of household packaging waste in autumn 2023. In order to facilitate this new data reporting requirements would be required which will need to be delivered by a separate statutory Instrument, introduced in 2021. A separate Statutory Instrument is needed as the packaging Extended Producer Responsibility regulations would not be in in force until late 2022. 

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