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The Regulations

Some of the first legislation to be enacted in the wake of the Kyoto Agreement, was the Producer Responsibility Obligations (Packaging Waste) Regulations, which came into effect at the end of August 1997 in England and in 1999 in Northern Ireland. Today, the fact that corporate social responsibility and all that it entails features prominently in many company cultures is testament to the success of regulations such as these, designed to protect the environment and our way of life.

Any company with an annual turnover of £2m or more and who handle at least 50 tonnes of packaging a year is affected by these regulations. For a percentage of each tonne of packaging waste generated (at various stages in the packaging chain), proof is required that a tonne of that material (wood, paper, glass, plastic, aluminium or steel) has been recycled. Contrary to simple expectation, this doesn’t mean that companies handling packaging actually have to recycle the packaging they handle (how, exactly, would that work?). No, it means that companies handling packaging pay reprocessors for the waste materials they recycle. This puts money into the recycling industry thereby keeping the system flowing. Ultimately, packaging ends up in the waste stream, so companies who make it, or import it, or fill it with their goods, or who sell it to the consumer all contribute to packaging waste. Paying a contribution towards its recycling is an incentive to reduce packaging.

The legislation stipulates that companies who are obligated under the Regulations must prove they have paid for the requisite amount of tonnes to be recycled each year. This is a market-led process; reprocessors are licensed to issue a Packaging (Waste) Recycling Note (PRN – or PERNs for exported packaging) for each tonne of specific material they have recycled. Obligated companies must buy the appropriate quantity of PRNs for the appropriate materials as proof they have fulfilled their obligations. The price of PRNs is set by the reprocessors according to the availability of material being recycled. Thus PRNs have joined the commodities marketplace.

The regulations affect you now if you:

  • have a turnover of more than £2 million and
  • handle more than 50 tonnes of packaging in a year

What does 'handling' packaging mean?

You "handle" packaging whenever you  perform an activity involving packaging, including manufacturing, filling or selling it. The packaging chain is defined in the regulations as having four levels (raw material manufacturer, converter, packer/filler and retailer). You 'handle' packaging when you carry out any of the four stages of the packaging chain.

If you are affected you need to do the following:

  • Define the weight of packaging that you handled in the previous year. This means that if you have an obligation for 2010, you need to be calculating the weight of packaging that you handled during 2009.
  • Work out the weight of packaging that you have to recycle and recover during 2009.
  • Decide how to discharge your obligations

Small Producer Allocation

The 2005 regulations allow companies with a turnover of between £2 and  £5 million to opt to discharge their obligations using the small producer allocation method.  This system simplifies the data gathering for small businesses, so that instead of having to calculate their data in a way that is “as accurate as reasonably possible” with this method your obligations are based on your turnover. Your turnover and predominant material handled must be specified.

If you choose to register as a small producer, you must use this method for 3 years.  You can't chose to change to a tonnage based registration within this time, although if turnover fluctuates around the £5 million then you will need to ensure that you continue to gather data if you are likely to exceed the £5 million turnover threshold in the following year.

Licensors and Pub Operating Businesses

The 2005 Regulations introduce new obligations on franchisors; defined as “Licensor” and “Pub Operating Business” combined these are referred to as “head organisations”. Packaging or packaging materials that bear the trade mark of the head organisation (i.e licensor) for which a licence to use such trade mark has been granted under the licence agreement will now be obligated.

Imported Packaging 

All imported packaging needs to be accounted for.  In earlier regulations,  packaging was thought to have been reused previously and was only counted on the first trip.  Now the regulations state that any 2nd hand imported packaging that was handled must  be reported. 

This will largely affect those companies who import goods on re-used pallets.  If however, the pallets are returned abroad (exported) thus never entering the UK waste stream they will not need to be reported.

What to do

The majority of the obligated companies registered under the regulations have become members of collective schemes such as the Acu-Pak Compliance Scheme.

Please contact us to discuss the scheme further