Much to the displeasure of label manufacturers, the Environment Agency has decided that they to must comply with the new Packaging Waste Regulations.

The Regulations require companies which handle more than 50 tonnes of packaging material in any relevant year, and have an annual turnover of at least £5 million in that year, to recover and recycle specific amounts of packaging waste. They also have to certify that this recovery and recycling has been achieved.

They can do this themselves or join a registered compliance scheme which will assume the responsibility for meeting their obligations.

Tom Machin, chief executive of the British Printing Industries Federation (BPIF), said: ‘We are extremely concerned that the Environment Agency is considering including label manufacturers among companies subject to a converter obligation under the Packaging Waste Regulations.’

‘For the last eleven months, our working assumption following advice received from the Department of the Environment and, more recently, the Environment Agency, has been the complete opposite – namely, that label manufacturers would have no such obligation.’

He continued: ‘We see no justification for the Agency to consider reversing its decision at such a late stage. The commercial consequences for our members would be immense.’

Leigh Martins, sections director of the BPIF, added, ‘We don’t know why the Government changed its mind, but it’s unacceptable for companies at this late stage to discover that action is required so quickly.’

‘We estimate that as many as 50
label printers that were previously excluded from the regulations will now come within their scope. They’ll now have to register and set up data collection systems, with all the associated costs.’

The Environment Agency’s advice to staff on how to assess what is (or is not) packaging contains Test no 7 which states: ‘Is the component a label whose principal function is to convey information and which is separately applied to another packaging component?’

‘Defining what is or isn’t packaging has been a very contentious issue,’ commented Jeff Cooper, the Environment Agency’s co-ordinator on producer responsibility.

‘This interpretative document will enable staff to provide consistent advice to industry. We realise that this interpretation of packaging may incorporate new areas not previously considered as packaging – such as labels.’

As for the BPIF’s complaint about late notification, another Environment Agency spokesperson said: ‘The Department of the Environment gave responsibility for the criteria to the Environment Agency.

‘It was never the case that someone explicitly said labels should not be included. Any components of packaging are included – and that does mean labels.’

A recent letter to Tom Machin from the Environment Agency states: ‘It would seem inappropriate to take too firm a line this year with companies dealing with peripheral packaging – including labels – who have been given advice, only lately, that they are likely to be obligated.’

The amount which each individual business is required to recover or recycle depends on whether its packaging activities comprise production of raw materials (6 per cent), conversion of raw materials to packaging (11 per cent), packing/filling (36 per cent) or retailing (47 per cent).

Jamie Grant, of MacRoberts Solicitors’ Environmental Law Department, warned, ‘The regulations are complex and packaging businesses would be well advised to take immediate legal advice on their liability. If they do not comply with the regulations they could be subject to criminal prosecution.’

So what are the options for registration?
1) To register individually with the Environment Agency or the Scottish Environment Protection Agency (SEPA).
Business registering individually are not expected to undertake the recovery and recycling themselves, unless they already have, or plan to develop, the facilities to do this. They can meet their targets by paying waste management companies, specialist reclamation companies and/or reprocessors to undertake the recovery and recycling on their behalf.

2) To join an existing compliance scheme.
A compliance scheme takes on a company’s legal obligations – in particular, its legal responsibility to meet their recycling and recovery obligations. The Environment Agency is advising businesses to look at the merits of joining a compliance scheme as compared to registering individually.

3) To start their own compliance scheme.
Trade associations, waste management and reclamation companies, and other organisations with access to packaging waste materials could examine whether there is the opportunity to set up a compliance scheme for their members/customers on a national or regional basis.

The scheme will require approval by the Secretary of State for the Environment and the Environment Agency, and will also be scrutinised by the Office of Fair Trading.

Already John Bridgeman, director general of Fair Trading, has published his advice following competition scrutiny of three compliance schemes.

Mr Bridgeman has recommended that the Secretary of State for Trade and Industry, Margaret Beckett, should advice the Environment Agency that she is satisfied that the Valpak, Difpak and Biffpak schemes will not be anti-competitive.

The Valpak scheme is open to all companies with obligations under the regulation and will deal with all types of packaging material covered by them. Difpak is a scheme set up by The Dairy Industry Federation and is primarily aimed at that industry.

Biffpak is, like Valpak, a cross-sectoral and multi-material scheme open to all obligated companies.

Bridgeman commented: ‘I was concerned at the advantages that Valpak may have gained by being the first scheme to be set up under the new regulations.

‘These concerns have been met largely by the development of competing schemes. I have looked at all the issues surrounding the operation of these compliance schemes and in the present circumstances I believe that they will not operate in an anti-competitive manner.’

The Office of Fair Trading has also consulted on two further schemes, Wastepack and Recycle UK, advice on which will be published in due course.

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