Extended Producer Responsibility (EPR) is now in place and obligated businesses must begin preparing for the first EPR data submission now.
The EPR system is designed to incentivise certain members of the supply chain to use easy to recycle materials for their packaging by making obligated companies responsible for the full net cost of the collection and recycling of the packaging waste they place onto UK markets.
Recent EPR Updates
What is Packaging Extended Producer Responsibility?
Extended Producer Responsibility is a system whereby obligated packaging producers will be required to fund the full net cost of the collection, sorting, treatment of packaging waste as well as the actual recycling of packaging. Obligated organisations are required to report EPR packaging data from 2023 with financial obligations coming into force in 2025 for ‘Large organisations’.
It is the principle that the direct cost of specific packaging recycling should be met by the those placing the packaging onto the UK market. Transferring the responsibility from the taxpayer and placing it onto brand owners and producers.
EPR will fund the collection, treatment and sorting costs of packaging waste through direct payments from producers. Alongside this, producers and importers will still fund the actual recycling of their packaging waste through the purchasing of Packaging Recovery Notes (PRNs).
When is the UK Packaging EPR taking place?
Packaging producers obligated under EPR will have been collecting detailed packaging data in the 7+ Other categories since January 2023 ready to submit their first EPR submission on 1st October 2023 for the reporting period of Jan-June 2023.
Registration under EPR took place in August 2023.
The reporting categories for phase of EPR are the following:
- Fibre-based composites
By Q3 of 2025 obligated Producer’s will be required to gather more granular packaging data in the modulated categories, such as polymer type and packaging format.
1st October 2025 will be the first EPR Local Authority Payment from obligated Packaging Producers to the Scheme Administrator.
What are modulated fees?
Modulated fees, or eco-modulation, is the mechanism by which EPR aims to reduce packaging placed onto the UK market. Under this approach, each material grade is assigned an EPR fee based on a recyclability assessment, with lower fees for more easily recyclable materials.
Although the initial focus of eco-modulation is on recyclability, Defra will consider broader environmental implications of packaging materials in later EPR revisions. These modulations encompass Local Authority collection and sorting costs, featuring bonuses for some materials and malus for others.
How will EPR work?
EPR will fund the full net cost of the collection, sorting and treatment of packaging waste through local councils by obligated packaging producers; the actual recycling of packaging waste will be funded by producers through the PRN system.
The collection and recycling of business packaging waste, for now, will be funded by the businesses that dispose of the packaging waste.
Who is obligated under the UK Packaging EPR?
Organisations placing 25t of packaging onto the UK market who also have a minimum turnover of £1m, are obligated under Extended Producer Responsibility and are defined as ‘Packaging Producers’ in the new regulations.
There is a lowered threshold for EPR:
- You are classed as a ‘small organisation’ if either of the following apply:
- Your annual turnover is over £1 million and you’re responsible for supplying or importing between 25 tonnes and 50 tonnes of empty packaging or packaged goods in the UK
- You will be classed as a ‘large organisation’ if both of the following apply:
- You have an annual turnover of £2 million or more (based on your most recent set of audited accounts)
- You are responsible for supplying or importing more than 50 tonnes of packaging or packaged goods in the UK
How does EPR interact with DRS?
Producers of DRS packaging will not be required to pay the disposal cost fees under Extended Producer Responsibility for their packaging ending up in household waste or in street bins. The government does not consider it desirable to obligate producers of DRS packaging to pay disposal costs under Extended Producer Responsibility for the intervening period between DRS and EPR implementation.
In the intervening period before the DRS commences, glass bottles sold into Wales will be covered by the Local Authority collection cost obligations under Extended Producer Responsibility, making this consistent with the requirements for glass bottles in England and Northern Ireland. Producers will be required to pay an EPR fee on this material during the intervening period between Welsh DRS and EPR implementation. Once the DRS in Wales goes live, glass drinks bottles in Wales will be exempt from EPR Local Authority Waste Management fees.
How does EPR interact with PRNs?
PRNs subsidise the cost of actual recycling in the UK whereas EPR will cover the full net cost of the collection, treatment and sorting costs of packaging waste.
In the new system, businesses obligated under EPR will be required to:
- Submit granular packaging data twice a year
- Purchase the equivalent number of P(E)RNs to the amount of packaging they have placed onto UK markets
- Pay a Local Authority Waste Management Fee and scheme administrator costs to the scheme administrator (scheme administrator for Extended Producer Responsibility is yet to be announced)
Under Extended Producer Responsibility, the purchasing of P(E)RNs remains the mechanism through which obligated businesses comply with their recycling obligations. Under the new system, obligated businesses will continue to purchase P(E)RNs as they do now however, there will be an additional Local Authority waste management fee to cover the full net cost of collection, treatment and sorting of packaging waste.
What are the labelling requirements under EPR?
Brand owners and importers will be obligated to label their primary and shipment packaging made from most materials either ‘recycle’ or ‘do not recycle’ with an accompanying logo by 31st March 2027. For plastic films and flexi plastics must comply by 31st March 2028.
All packaging, regardless of business size, are required to adhere to labelling rules under EPR. In the case of small businesses, the responsibility may shift to the ‘Large Producer’ supplying unfilled packaging to ensure accurate labelling.
Regulations are likely to require packaging manufacturers to provide recyclability information to distributors who sell unfilled packaging to small and micro businesses, or directly to such businesses.
The Office for Product Safety and Standards (OPSS) will be the organisation responsible for the monitoring and enforcement body of the labelling requirements.
What are the producer types under the Packaging EPR?
There are 6 producer types under EPR with the single point of compliance often falling on the ‘brand owners’ or ‘importers’. Your producer type relates to your packaging activity, which is how you place packaging onto the UK market.
A brand owner: an organisation who supplies packaged goods to the UK market under your own brand
An importer: an organisation who imports products in packaging from overseas, who then go on to supply these products to the UK market.
A packer/filler: an organisation who places goods into packaging that’s unbranded when supplied onto the UK market.
An online marketplace operator: an organisation who operates a website or app that enables businesses or persons to place their packaged items or goods onto the UK market.
A service provider: an organisation who hires or loans out reusable packaging
A distributor: an organisation who supplies unfilled packaging to a company who is not a large producer, subject to obligations, who then go on to supply that packaging to the UK market.
How will Packaging EPR impact businesses?
‘Small Organisation’ EPR obligations:
- You will report data once a year
- You will not be obligated to pay a Local Authority Waste Management fee
‘Large Organisation’ EPR obligations:
- You will report data at least twice a year
- Pay for disposal costs for the packaging waste that goes into household collection and street bins.
- Meet recycling obligations (met by acquiring PRNs/PERNs).
- Nation of Sale – report where packaging is disposed, by nation within the UK.
How much will EPR cost?
EPR will change the way that costs of compliance are spread throughout the supply chain.
Under the current producer responsibility system, costs are shared throughout the supply chain, with percentage responsibility allocated to different points:
- 6% to manufacturers of packaging materials
- 9% to businesses that convert those raw materials into packaging
- 37% to businesses that pack fill that packaging (primary, secondary, and transit)
- 48% to businesses that sell that filled packaging to end users (primary, secondary, and tertiary packaging)
EPR will replace all of the above with a single point of compliance that levies 100% responsibility for a piece of packaging onto one business – that business will be the brand owner or importer – most often this will be the pack filler, or the business that specifies the pack filling. For secondary and transit packaging, the brand owner will also be the reporting party, and where packaging is unbranded, reporting will be by the pack-filler.
100% responsibility will now sit with one company, this means that often a pack filler brand owner of primary packaging may see their share of cost move from 37% to 100%, almost 3 times increase in the volume of packaging they now need to fund the management and disposal of. For those companies that formally picked up the packaging manufacturer, converter, or seller of primary packaging, their responsibility for primary packaging will now be zero.
So, for the part of EPR that funds the recycling process through PRNs the biggest change is in the percentage responsibility for PRNs – previously pack fillers funded roughly 1/3 of primary packaging, and under EPR, those that are brand owners will fund it all. So, an increase for those companies in their recycling obligations.
What are the Packaging EPR reporting obligations?
Obligated packaging producers will be required to report data on the packaging they place onto UK markets.
Those classed as ‘Small Organisations’ will be required to submit data once a year (1st April 2024), reflecting the Jan-Dec reporting period.
Those classed as ‘Large Organisations’ will be required to submit two packaging data sets, one reflecting the Jan-June reporting period (1st October 2023) and the second reflecting the Jul-Dec reporting period (1st April 2024).
What packaging data do business need to report for EPR?
1. Type and weight of material
You should categorise your data by the following materials:
- Fibre-based composite
- Paper or cardboard
‘Other’ includes any materials you use that are not listed here. For example, other materials could include:
2. Packaging Activity
This refers to how you place packaging onto the UK market.
- supply packaged goods to the UK market under your own brand
- place goods into packaging that’s unbranded when it’s supplied
- import products in packaging
- own an online marketplace
- hire or loan out reusable packaging
- supply empty packaging
3. Packaging type
This refers to whether your packaging is:
4. Waste type
- Large organisations will need to report whether the packaging:
- is household
- is non-household
- commonly ends up in public bins
- is a drinks container
- is reusable
- becomes self-managed waste
Why is EPR being implemented?
In 2018 the UK adopted the Circular Economy Package (CEP) meaning that the UK is committed to keeping resources in use for as long as possible, minimising waste and promoting resource efficiency.
EPR will support local authorities by funding kerbside collections and more effective management of packaging waste, it is the UKs answer to meeting the CEP and incentivises the use of easily and widely recycled materials and the use of.
How will Local Authority funding change after EPR?
Under EPR, producers will fund the full net cost of the collection, sorting and treatment of packaging waste, the costs of this are estimated at roughly £1.2bn. Once these costs are spread amongst those obligated under EPR, costs for these businesses are likely to exceed 5 times the cost of their current compliance. However, as the new system has a single point of compliance, obligated producers will now take 100% responsibility meaning that the real time costs could be as high as 13 to 15 times their PRN costs.
EPR is set to generate £1.8bn, with £1.2bn to be given to Local Authorities to fund the kerbside collection, treatment and sorting of packaging waste.
In 2027 the scheme administrator will begin their efficiency and effectiveness assessments on Local Authority collection processes to ensure that the money raised from EPR will only be used to finance effective systems.
How do I prepare my organisation for EPR?
To prepare for EPR and achieve a seamless transition to the new system you must:
- Submit your H1 2023 EPR data as soon as possible
- Prepare resources for two data submissions a year (three in 2024)
- Build a packaging optimisation strategy considering the recyclability and how widely recycled your chosen packaging materials are, as well as wider environmental factors such as the carbon impact of your packaging
- Begin preparing for granular reporting by polymer types and packaging formats for the second stage of EPR reporting in 2025
- Speak to your Compliance Manager at Clarity to keep up to date with any developments on the timeline of EPR, and to find out how we can further support you
Further EPR support
Do you or your business require further information about EPR? Reach out to our team of experts to book a free EPR consultation to review your business needs.
Alternatively, if you are a Comply with Clarity member and require further information on the revised timetable and your responsibilities, please get in touch utilising the form below, your compliance manager will respond to any of your questions.