Undermining Environmental Sustainability:
Businesses falsely claiming PRNs deceives consumers as well as packaging producers, undermining the integrity of recycling and eroding trust in the system. This discourages individuals and businesses from actively participating in the system. As a result of this disengagement, recycling levels are reduced, exacerbating environmental challenges.
Lost Economic Opportunities:
Recycling fraud not only harms the environment but also undermines the economic potential of the recycling industry. Legitimate recycling businesses invest in infrastructure, technology, and workforce development to process and market recycled materials. However, when fraudsters introduce non-recyclable or contaminated materials into the recycling stream, it disrupts the value chain and lowers the quality of recycled products. Consequently, legitimate recyclers face financial losses, reduced demand for recycled materials, and missed opportunities for growth and job creation.
Recycling fraud erodes consumer confidence in recycling programs, leading to disillusionment and apathy towards sustainable practices. When individuals discover that their diligent recycling efforts may have been in vain due to fraudulent activities, they may question the value of recycling altogether. This disillusionment can lead to reduced participation in recycling programs, compromising the collective effort required to build a greener future.
Risk of PRN cancellation and financial strain on packaging producers:
In July 2021 the Environment Agency (EA) reconfirmed their position on fraudulently issued or unethical PRNs. In a letter clarifying their position, they stated that they would be taking action against buyers and suppliers of PRNs who purchase or sell recycling evidence which is considered to be illegitimate.
In 2022, the Environment Agency conducted audits on a total of 176 reprocessors or exporters. The findings revealed that 20 of these entities faced suspensions, while four faced accreditation cancellations. These numbers reflect a notable 9% rise in suspensions and cancellations compared to the previous year.
Recycling fraud poses a significant financial risk on those obligated under the packaging waste regulations. As the Extended Producer Responsibility for packaging reform is implemented, packaging compliance costs will increase significantly. It is crucial that other, more unpredictable, compliance costs are mitigated.
Clarity is an advocate for transparent recycling practices and through our quality standard we work to mitigate financial risk of Packaging Recovery Note cancellation for Comply with Clarity scheme members whilst also promoting and partnering with responsible recyclers.