The Packaging Waste Regulations In Plain English
PRN's, eligibility, non-compliance and other things you might not be aware of...
Here at Kite we like to think of ourselves as somewhat experts in our field, sometimes this means creating innovative packaging solutions for a customer to solve a long-term problem, sometimes it means improving our customer service to adhere to tight time schedules - and sometimes it means helping customers through the mine-field of 'The Packaging Waste Regulations'.
In this post we'll be going through the basic principles of these regulations and why they matter to all companies who are eligible, including handy hints on how to go about preparing for your next assessment.
The Packaging Waste Regulations (long name alert: The Producer Responsibility Obligations (Packaging Waste) Regulations 2007 and Amendments) have a complicated history, and a number of different agencies are involved with the legislation. The easiest way to view the regulations is that it is basically a tax on packaging use, which is used to fund recycling of packaging waste and minimise the impact of packaging waste on the environment.
- The UK produces millions of tonnes of packaging waste per year, most of which ends up in landfill
- The Packaging Waste Regulations were implemented in response to a 1994 directive from the EU (European Union)
- The regulations were written and produced by government agency DEFRA (Department for Environment, Food and Affairs)
- They are enforced by The Environment Agency, who audit the businesses and enforce legal action for non-compliant businesses
TIP! Legislation means exactly that, the Regulations are a legal requirement for businesses introducing packaging in to the UK system through their business activities. In terms of your business they have nothing to do with waste collected, it is about the packaging you handle on an annual basis. Read on to find out if your business is obligated.
Eligibility and Obligation
The main reason for the Regulations is to make UK companies responsible for the recycling of packaging waste, and the cost involved in this. However, not all companies are obligated and the Regulations have been designed so that small businesses, with a turnover of less than £2 million, are not required to participate.
However if your company.
- Is a UK business that performs any activities involving packaging
- Has a turnover of £2 million or more
- Handles more than 50 tonnes of packaging per year (excluding exported packaging)
Then you are obligated to register with the Environment Agency and submit annual reports about the packaging you have introduced into the UK.
PRN's or Packaging Recovery Notes often install fear in to businesses but they aren't too difficult to get your head around once you know the basics.
- PRN's are evidence of recycling packaging waste
- For every tonne of packaging waste recycled, one PRN is issued
- PRN's can then be sold on the open market by the reprocessors who recycle the packaging waste, and the money is re-invested in to new recycling plants and collection schemes to increase the recycling of packaging waste
- PRN prices fluctuate according to market conditions, for example at the start of 2013 plastic PRN's were trading at £12 in lower volume and last month peaked at £70. This market volatility creates a problem for companies trying to budget for the cost of compliance each year.
Each company has a PRN obligation, which differs according to packaging weight, national target and activity percentage.
A company's activity percentage is basically the type of activity the company does in the supply chain. Taking the example of a tin of beans the activity percentages are as follows.
- Manufacturer - Produces tin sheeting - 6%
- Convertor - Folds and presses in to a tin can - 9%
- Packer/Filler - Fills with beans and uses further packaging to protect and contain product - 37%
- Seller - Supplies end user - 48%
- End user - Buyer/consumer of packaging - 0% (but if the packaging is imported 100%)
Then working out your PRN obligation is as follows:
Packaging Weight (Tonnes) X Activity Percentage X National target (Approx. 75% in 2013) = PRN Obligation
Now that we've taken care of PRN's you'll need to assess the actual packaging that is obligated under the regulations. This includes anything used for the containment, protection, handling, delivery and presentation of goods (just about everything!). The packaging materials accounted for include paper, plastics, wood, aluminium, steel, glass and other and can be anything from point of sale, to outer units to transit packaging such as pallets and IBCs.
The packaging covered by the 50 tonne threshold (as mentioned in eligibility and obligation) includes all packaging around imported, raw materials, components and finished goods, any packaging added by you and supplied on into the UK. Excluded from your obligation is customer or supplier owned packaging, packaging that is reused in its original form (unless it is imported) and packaging around goods exported out of the UK.
Before registering with The Environment Agency your company must firstly assess which method of compliance they are going to take. There are two different methods of compliance:
Allocation Method: If your turnover is between £2 - £5 million you can provide your turnover figure from your audited accounts, and 30 PRN's in the predominant material handled are supplied per £1 million turnover.
Data Submission Method: If your turnover is over £5 million your company must assess the obligated packaging they have introduced into the UK and produce a packaging data return. PRN's will then be supplied accordingly.
The overall method for assessment and registration is therefore as follows.
- Apply the regulations to your business
- Assess what packaging you are handling
- Develop a system for collecting packaging data
- Collect the data
- Complete all the calculations
- Finalise data submission form
- Register your data
- Purchase and obtain PRN's
This process is long, complex and obligatory; non-compliance can result in civil sanctions or prosecution. Naturally, this is why 90% of businesses opt for a compliance scheme to help them with their assessment and the registering process, compliance schemes have been around since the regulations were introduced in 1997 and act as a intermediary between the company and the Government.
Kite Environmental Solutions
Kite's compliance scheme, Kite Environmental Solutions (KES) aims to manage the entire process and adopts the 'Kite approach' when it comes to service. Many compliance schemes simply register companies; KES is different as it takes your business through the entire process, offering one-to-one help and its packaging expertise as part of the Kite Packaging Group to make the process as painless as possible.
To find out more simply visit the KES website or call 02476420088.
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