1 JANUARY 2015: THE FUTURE OF PACKAGING COMPLIANCE

HOW NEW WASTE LEGISLATION AFFECTS BUSINESSES IN AUSTRIA

From 1 January 2015, the amendment to the Austrian Waste Management Act (WMA) and the recast Packaging Ordinance 2013 will bring some major changes regarding packaging waste obligations and the collection and recovery of packaging. This folder gives you an overview of the key changes for businesses that put packaging in the market in Austria.

WHY NEW REGULATIONS?

•    Ensure fair competition
In future, several collection and recovery systems (CRS) will be offering compliance services for household packaging in Austria. The amendment aims to promote fair competition between them.

•    New Definition of household and commercial packaging
A clearer legal definition of household and commercial packaging and better control mechanisms will improve legal certainty for businesses, CRSs, and the disposal industry.

•    Maintain the high Standards achieved
Packaging recycling helps protect the environment by conserving raw materials and protecting the climate. Austria is one of the best recyclers in Europe – in no small part thanks to ARA’s work over the past 20 years – and needs to retain its pioneering role in the interest of the environment. Reducing environmental damage and conserving natural resources are still some of the main objectives of the amended WMA. This is why it provides for a marked increase in the funds earmarked for waste avoidance, among other things.

•    Maintain the high level of convenience for households and businesses 
Packaging collection in Austria has to remain highly convenient for households, and the well-developed collection infrastructure must be retained. The changes necessary in the collection of packaging from households and small businesses will be negotiated in a stakeholder dialogue process.

•    Ensure cost-effectiveness
Whenever it is economically feasible to do so, packaging will be collected and recovered separately, and the coverage ratios will be adjusted accordingly.

 

WHO IS OBLIGATED TO USE A COLLECTION AND RECOVERY SYSTEM?
Using a CRS is mandatory for household packaging. The primary obligation applies to packers/fillers, importers, own-use importers and mail-order companies as well as manufacturers and importers of service packaging, provided that they have a registered office or a place of business in Austria. The primary obligation also extends to cross-border mail-order sales.

Taking back and recovering household packaging without the involvement of a CRS will no longer be an option. In contrast, for commercial packaging, obligated businesses will still be able to choose whether they want to take it back themselves or use a CRS.

The customers of entities with a primary obligation (e.g. trading companies) will no longer be able to take on the obligation and conclude a compliance agreement with a CRS. As a result, the legally binding confirmation (Rechtsverbindliche Erklärung) they had to issue becomes obsolete for household packaging.

In contrast, the suppliers of entities with a primary obligation (e.g. packaging manufacturers, suppliers of service packaging, foreign suppliers) can still take on the obligation for household packaging and conclude a compliance agreement with a CRS. To do so, they need to enter an agreement with the entity with a primary obligation, and they need to issue a legally binding confirmation (Rechtsverbindliche Erklärung) to certify participation in the CRS. The entity with a primary obligation remains responsible for the packaging under administrative law, though.

 

ARE RETAILERS/WHOLESALERS OBLIGATED, TOO?
For packaging provided by domestic suppliers, retailers/wholesalers are no longer obligated under the packaging regulations (as domestic suppliers fall under the definition of entities with a primary obligation). However, the situation is different for imported packaging: Trading companies have a primary obligation for imported packaging. Their foreign suppliers can conclude a compliance agreement with a CRS, but the trading companies are still responsible for imported packaging under administrative law.



DEFINITION OF HOUSEHOLD AND COMMERCIAL PACKAGING
The WMA amendment for the first time contains a clear definition of household and commercial packaging that is binding for all businesses and all CRSs.

In this way, the allocation of packaging to one of the two categories can no longer be used as a sales argument.


 
HOUSEHOLD PACKAGING: TWO DEFINING CRITERIA

Size
•    a surface area of up to and including 1.5 m² or
•    a nominal volume of up to and including 5 litres or
•    a mass of up to and including 0.15 kg per sales unit for packaging made of EPS (e.g. Polystyrene)

Type of waste producer
The packaging in question must be typically discarded by households or businesses with household-like packaging waste arisings. The definition of businesses with household-like packaging waste arisings specifically includes restaurants and bars, hotels, cafeterias, small tobacconists, administrative buildings, barracks, hospitals and doctor’s offices, educational establishments, lawyer and notary offices, public accountant offices, charitable organisations, cinema and theatre buildings, opera houses and museums, holiday facilities, parks, sports facilities, outdoor swimming pools, tanning salons, fitness centres and motorway service stations, public squares as well as other micro-enterprises.

Paper packaging: A special case
Sales packaging made of paper, paperboard, cardboard and corrugated board is still considered household packaging, whereas transport packaging made of these materials is considered commercial packaging.
In any case, service packaging, carrier bags and knot bags belong in the household packaging category.
Commercial packaging is defined as all packaging that is not household packaging. In any case, pallets, strapping bands and adhesive tapes belong in the commercial packaging category.

Please note
The provisions of the new Packaging Ordinance 2013 on the allocation of packaging to the household or commercial category (Annex 2) will in all likelihood enter into effect before 1 January 2015, as they transpose the EU Packaging Directive into national law.
 


INDUSTRY-SPECIFIC ALLOCATION
ARA’s industry-specific allocation of packaging to one of the two categories (household and commercial) used to be a solution to reduce the administrative burden for businesses.

In future, the Environment Ministry will issue ordinances to provide industry-specific regulations in deviation of the general allocation rules (size and waste producers, see above). This is an advantage in that the percentage allocation of packaging to the two categories will be unambiguous and binding for all businesses.

 

USING MORE THAN ONE CRS
Obligated businesses can register with one or more CRSs, provided that each CRS has a permit for the respective packaging material (paper, glass, metal or light-weight packaging) and the household or commercial category.

If you use more than one CRS for packaging that belongs in the same tariff category, you have to inform the CRSs in advance of their respective shares using verifiable criteria. Changing these criteria and switching between CRSs is only possible at the end of each quarter.



SUBMITTING DATA: WHAT’S NEW?
A CRS’s scope of responsibility will depend on its respective market share. To determine the current share, the Environment Ministry sets very short deadlines for submitting data. We assume that obligated businesses will have around two weeks after the end of each month/quarter for submitting their packaging data to the CRS.

At present, negotiations are ongoing to simplify the process for businesses with very small packaging arisings.


LICENSE PARTNER AUDIT
From 1 January 2015, a newly established Coordination Board will check the accuracy of the waste data submitted by the customers of all CRSs. These checks aim to eliminate competitive disadvantages for businesses that provide accurate data and minimise freeriding.

The Coordination Board will be established at the Austrian Federal Ministry of Agriculture, Forestry, Environment and Water Management. It will take on tasks for all CRSs on the basis of contractual agreements.


COMPARING PRICES BETWEEN DIFFERENT CRSs
In future, all CRSs will be obligated to treat all customers equally, i.e. they will have to charge uniform rates per category. Tariff rates and a customer list have to be published online and must be updated on a monthly Basis.

This will ensure transparency and allow license partners to compare the CRSs’ current rates. Thanks to the publication of tariff rates, customers will also be able to better assess the offers of intermediaries.


EFFECTS OF INCREASED COMPETITION ON ARA’S HOUSEHOLD TARIFFS
ARA’s tariffs reflect the expenses the various packaging materials cause in the collection and recovery cycle. Our tariffs will change as a result of the new legal requirements if (i) we have to redesign our collection schemes to achieve quantitative and qualitative improvements, or (ii) we have to comply with stricter requirements regarding the collection or recovery of packaging waste.

Our main focus still lies on efficiency gains, realising cost-reduction potentials – e.g. by switching to PET bottle collection instead of the traditional light-weight packaging collection – and on the best-possible recovery of the materials collected to serve the interests of our customers.


THE FUTURE OF HOUSEHOLD COLLECTION
The future principles for the collection of packaging from households will be determined in a stakeholder dialogue process set up by the Environment Ministry. Stakeholders are representatives of Austria’s social partners, provincial governments, the Austrian Association of Cities and Towns, the Austrian Association of Municipalities, the disposal industry, CRSs, and the newly established Coordination Board.

The new system should bring little or no changes at all for households. The amendment to the WMA prohibits the duplication of collection facilities, i.e. CRSs may not build up their own collection facilities for household packaging; instead, they have to share use of existing structures.


TWO TYPES OF SHARED USE FROM 2015:

•    Shared use at the system level (Article 30 WMA)
Under this model, a new CRS entering the market concludes an agreement with an existing CRS on the nationwide shared use of the collection infrastructure for a particular packaging material.

•    Shared use at the municipal level (Article 29 C WMA)
Under the second model, a new CRS concludes shared-use agreements with all municipalities and all collection partners across the country.


SOLUTION FOR SMALL BUSINESSES
The household collection scheme will still be available for packaging waste produced by Austria’s around 70,000 small businesses.


NEED FURTHER INFORMATION?
Talk to us.
Please contact your key account manager or call our hotline at +43.1.599 97-555 for further information on the WMA amendment and all other questions you may have regarding the range of services we offer.
Up-to-date information on the WMA amendment and the recast Packaging Ordinance is also available at www.ara.at/awg2013 (German only).