Joint industry statement sparks debate over “state-run producer responsibility organizations” in PPWR

29 Jan 2024 --- Stakeholders of the packaging industry represented by various trade bodies have released a joint statement raising concerns over proposed EU legislation impacting producer responsibility organizations (PROs) in the packaging sector. The statement calls on EU legislators to reconsider references to “state-run producer responsibility organizations” in the Packaging and Packaging Waste Regulation (PPWR).

The crux lies in the potential reversal of progress achieved through the 2018 revisions of the Waste Framework Directive (WFD) and the Packaging and Packaging Waste Directive. Stakeholders fear that including provisions for state-owned PROs could undermine the EU’s leadership on EPR initiatives globally.

“The undersigned organizations representing companies from the entire packaging value chain are extremely concerned by the last-minute inclusion in the council’s general approach of references to ‘state-run producer responsibility organizations,’” reads the letter.

“We find incompatible with the concept of producer responsibility the notion that such producer responsibility organizations have ‘no represented producer mandate.’”

The inclusion of such references in EU legislation, according to the joint statement, could create loopholes allowing member states to evade their legal obligations. Moreover, it is argued that this move could adversely affect packaging recycling rates, impeding producers’ ability to meet their commitments and undermining the core recycling objectives of the PPWR.

According to the joint statement, references to state-owned PROs could create loopholes allowing member states to evade legal obligations.The statement is issued by multiple organizations representing companies across the packaging value chain including the Alliance for Beverages Cartons & the Environment, The Association of European Producers of Steel for Packaging, CEFLEX — A Circular Economy for Flexible Packaging, European Bioplastics, EUROPEN — The European Organisation for Packaging and the Environment, FoodDrinkEurope and others.

Balancing objectives with economics 
At the heart of the debate is the role of PROs, with concerns raised over their potential transformation into mere tax collection entities for state treasuries rather than serving the primary function of fulfilling producers’ responsibilities. 

“Recital 97a, Article 39.7b and Article 42.6 would result in PROs serving only as an entity to collect taxes for a state’s treasury and help the member state fulfill its reporting obligations. It would not exercise the core function of a PRO, which is to fulfill producers’ responsibilities on their behalf,” warn the signatories in the letter. 

“This interpretation is backed up by the Organisation for Economic Co-operation and Development’s observation that ‘state-owned PROs’ are a form of tax and cannot be considered as EPR since they contradict the minimum requirements for EPR schemes in Art 8a of the WFD.”

Proponents of the joint statement assert that achieving the objectives outlined in the EU’s Green Deal, including the goal of net zero emissions by 2050, should not be compromised by provisions that could hinder progress in recycling and sustainability efforts.

In response to the joint statement, EU legislators are now faced with calls to revisit the references to state-owned PROs in the draft PPWR. 

By Radhika Sikaria