Coming Soon: Ireland’s New Deposit Return Scheme
On 1 February 2024, Ireland’s new Deposit Return Scheme (the “Scheme”) will go live. Described as a ‘circular economy initiative’, the Scheme aims to incentivise consumers to recycle single use containers.
In this briefing, we look at the obligations that will apply to producers and retailers under the Separate Collection (Deposit Return Scheme) Regulations 2021 (the “Regulations”), as well as some recently published helpful guidance on the operation of the Scheme in practice.
What products are in scope?
The Regulations apply to:
- plastic bottles which have a capacity up to 3 litres;
- aluminium or steel drinks containers with a capacity up to 3 litres;
(each, an “in scope product”).
Who does the Scheme apply to?
The Scheme applies to producers, retailers and consumers of in-scope products.
For the purpose of the Regulations:
- a “producer” means any person, irrespective of the selling technique used, who is first to place in-scope products on the market in Ireland; and
- a ‘retailer’ means any person who for the purpose of trade or otherwise in the course of business sells or otherwise supplies in-scope products to a final consumer.
The Scheme will be operated by Deposit Return Scheme Ireland CLG, trading as Re-turn. Producers and retailers are required to register with Re-turn and enter into a Membership Agreement in advance of 1 February 2024.
How will the Scheme work?
Under the Scheme, producers of in-scope products will be required to pay Re-turn a ‘producer fee’ which is intended to cover:
- the costs of collecting and recycling in-scope products;
- the costs of data gathering and reporting in relation to the Scheme;
- the cost of business and consumer awareness raising measures in relation to the Scheme; and
- Re-turn’s administration costs.
Retailers are required to pay a ‘deposit fee’ to producers when they purchase in-scope products.
When a consumer purchases an in-scope product, they will be charged the ‘deposit fee’ in addition to the price of the product. Consumers may return empty, undamaged in-scope products to a retailer in order to receive a full refund of the consumer’s deposit fee.
Retailers may opt to accept the return of in-scope products over the counter (i.e. manual collection) or via a reverse vending machine which automatically accepts in-scope products and issues a voucher to be redeemed at the till. Retailers will receive a ‘handling fee’ for all in-scope products, which they take back.
Exemptions from the Scheme
The obligation on retailers to charge a deposit fee to consumers will not apply to in-scope products which are purchased and consumed on the retailer’s premises. This is an automatic exemption and retailers do not have to apply to Re-turn to avail of it. However, the following categories of retailers can apply to Re-turn for an exemption from the requirement to operate a takeback service from consumers:
- retailers with a footprint/layout of 250 sq metres or under of retailer store space;
- ‘food to go’ retailers;
- retailers in the hospitality sector (e.g. pubs, bars, hotels, restaurants and cafes); and
- online retailers.
Where a retailer has applied for and been granted a takeback exemption by Re-turn, it is required to provide certain information to consumers, including a QR code locator for consumers to find the nearest deposit return point and details of the Re-turn website.
Re-turn has published several documents on its website which set out in detail how the Scheme will operate in practice. In particular, Re-turn has published a Technical Specification and Labelling Manual (the “Manual”) which sets out the requirements for an in-scope product to be included in the Scheme. Participants in the Scheme will be subject to a contractual obligation (via the Membership Agreement) to comply with the Manual.
Re-turn has also published high level responses to a series of questions relating to the Scheme from the perspective of producers, retailers and consumers, which set out its interpretation of how the Scheme applies.
Under the Regulations, producers and retailers will be obliged to comply with requirements ‘prescribed by’ or ‘agreed with’ Re-turn. As a result, a failure by a producer or retailer to comply with the Membership Agreement or Manual could, indirectly, amount to a breach of the Regulations.
The Scheme has been described as a “major undertaking” for the beverage industry in Ireland. It is understood that over 90% of producers and approximately 2,500 retailers have registered with Re-turn to date. These producers and retailer have until 1 February 2024 to get to grips with their new obligations under the Regulations.
This document has been prepared by McCann FitzGerald LLP for general guidance only and should not be regarded as a substitute for professional advice. Such advice should always be taken before acting on any of the matters discussed.