How are determined the prices of eco-fees paid to recovery organisations?

Eco-fees paid to recovery organisations (ROs) as a result of the application of the extended producer responsibility (EPR) principle are also called remunerations, contributions or contractual fees.

The eco-fees are payable under contracts with these organisations.

For this reason, their determination is left to the freedom of negotiation between the parties concerned in accordance with the principle of freedom of negotiation (Article 9 of the Obligations and Contracts Act).

There are several key provisions in the legislation that provide guidance on how these types of eco – fees are formed.

Apart from this, several basic criteria can be derived indirectly from the legal framework, which can be summarised as follows:

  • Covering the costs of meeting the targets, set in a transparent manner and not exceeding the costs of providing the waste management services.
  • Eco-modulation – Modulation of individual products or groups of similar products, taking into account their sustainability, recyclability and the presence of hazardous substances in them, with the amount of remuneration not exceeding the costs necessary to provide the waste management services in a cost-effective manner.
  • Limiting it to the amount of the product fee and the competitive start.
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Covering the costs of meeting the objectives

In practice, this is the main and most important criterion for determining the eco-fees paid to organisations.

It is based on the idea that eco-fees should at least cover the costs of meeting the targets – i.e. collection, transportation, pre-treatment, recovery, including recycling of widespread waste that is generated when a product is placed on the market.

This can be inferred from the definition in § 1, item 35 of the Waste Management Act (WMA), according to which an “Extended Producer Responsibility Scheme” is a set of measures taken to ensure that producers of products are financially responsible or financially and operationally liable for the management of waste as a stage in the life cycle of the product after it has become waste.

In addition, Article 7(5) of the MSW Act stipulates that:

Responsibility for organising the management of widespread waste rests with the producer of the product whose use results in the waste.

The provision of Art. 14.9 of the WMA provides guidance that the costs of the RO should be determined in a transparent, cost-effective manner and should not exceed the costs of providing waste management services.

The relevant costs to be covered by the members of the RO and the criteria for determining the remuneration to the RO shall be determined by the regulations referred to in Article 13(1). 1 of the WMA and include at least:

  1. the costs associated with separate collection activities and their subsequent transport and treatment, including the achievement of the targets set out in the WSW Regulations, and the costs of investment in maintaining and developing separate collection systems;
  2. the cost of collecting information and reporting data and carrying out audits;
  3. the costs of education campaigns, information activities and promotion of separate collection.
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Eco modulation of eco-fees

Pursuant to Art. 11 of the WMA the regulation for the relevant WSW shall also determine the cases in which the remuneration paid by the members of the recovery organisation shall be differentiated according to different criteria.

The indicative criteria may be in relation to individual products or groups of similar products and may take into account:

  • their sustainability
  • repairability
  • reusability and recyclability
  • the presence of hazardous substances.

Eco-modulating of the fees to the RO is done to stimulate the production and marketing of sustainable and durable products that, when they come out of use, are easy to post-treat in order to feed them back into the economy more quickly and smoothly.

Limitation to the amount of the product fee

It is about the amount of the product fee paid to the EMEPA for each product being placed on the market that results as a WSW.

This product fee is statutorily fixed for individual types of products in Annexes 1 to 8 inclusive to the Ordinance for Determining the Order of Payment and the Amount of the Product Fee.

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Only one of the two types of eco-fee is payable – product fee or remuneration to the RO

The criterion has a significant impact on the setting of eco-fees by organisations, although it is not legally binding.

The rule followed by the RO is that the product fee for a given product type, which is fixed by regulation, is the ceiling of the eco-fee paid to them.

They set a remuneration that is below its value.

This is because, if they set a higher amount, obliged entities will prefer to pay the fixed product fee to the EMEPA, as they are given the freedom to choose where to opt in and to whom to pay the eco-fee – to an organisation or to the EMEPA.

This in turn underpins the competitive principle (discussed below) on which organisations are built.

Competitive start

RO, irrespective of the product to which they refer – oils, tyres, EEE, etc. – exist and operate on the basis of the competitive principle.

Thus, in practice, the eco-fees paid to organisations are always below the product fees set for the EMEPA.

At the same time, RO compete with each other, which ensures that objectives are met at the lowest possible cost.

The principle of the competitive principle was introduced by the latest amendment to the Waste Framework Directive through the European Commission’s Circular Economy legislative package, which has been transposed into national legislation.