Producer Responsibility Obligations (Packaging Waste) Regulations 1997

("The Packaging Regulations")

The Packaging Regulations implement the 1994 European Directive on Packaging and Packaging Waste with the objective of reducing the production of packaging waste. The obligation to reduce packaging waste is shared so that all qualifying businesses involved in the production or handling of packaging or packaged goods before sale to the final consumer attract a defined share of the responsibility.

Only companies involved in the packaging chain (manufacturing, converting, packing and filling or selling) whose activities exceed certain thresholds have any obligation under the Regulations. For the years 1997-1999, the threshold was an annual turnover of GBP 5,000,000 and 50 tonnes of packaging handled. Since 1st January 2000, the annual turnover threshold is reduced to GBP 2,000,000 but the amount of packaging handled remains at 50 tonnes.

Companies obliged under the Regulations must:

1. register with:

(a) either the Environment Agency ("the EA") or the Scottish Environmental Protection Agency ("SEPA") (as appropriate); or
(b) an approved compliance scheme

2. 'take reasonable steps to recover and recycle packaging waste' measured against targets calculated by reference to the total tonnage of waste produced

3. produce certificates of compliance to either the EA or SEPA (as appropriate)

Failure to meet any of the above obligations is a criminal offence carrying a penalty of up to GBP 5,000 in the Magistrates Court or unlimited penalties in the Crown Court. The EA have already brought a number of successful prosecutions for failure to register, although it is estimated that the number of companies not complying is still high (it is believed, largely due to the complexity of the Regulations).

Registration direct with the EA or SEPA is possible for an annual fee of GBP 950 (currently) but many companies prefer the simpler option of approved compliance scheme membership. This permits companies to join forces to share administration and costs and to meet the registration and recovery obligations collectively. There are 8 or so compliance schemes competing on fees to attract members. The compliance scheme is a third party which takes over the legal obligations on behalf of its members.

Obliged companies registered individually or approved compliance schemes must supply data on their packaging waste flows. Currently, the data must be 'as accurate as reasonably possible'. Previously, it needed only to provide 'a reasonable estimate'. The cost implications for extracting and reporting accurate data individually can be significant.

The obligation to recover and recycle came into force in 1998 and the EA have produced guidance on what constitutes 'reasonable steps to recover and recycle'. Packaging waste has been recovered or recycled when accepted by a reprocessor. Reprocessors accredited (voluntarily) by the EA or SEPA agree to abide by a set of procedures and keep standard records and issue Packaging Waste Recovery Notes ("PRN") compliance certificates in a standard form.

Membership of an approved compliance scheme generally avoids the need to register with the EA or SEPA individually and removes from obliged companies liability for non-compliance with the recovery and recycling targets set and the data provision requirements. The worst penalty for a scheme failing to meet its obligations is de-registration; there is no penalty on the individual members who must simply re-register with an approved scheme (or individually) within 30 days. The only remaining obligation is to produce an annual certificate of compliance, which the approved scheme would either provide or help a member complete.

For further information on this topic, please contact Tom Bainbridge at tba@cms-cmck.com or on (+44) (0)20 7367 3000.