Government Emergency Ordinance no. 74/2018 was issued on 17 July 2018 for the amendment and completion of Law no. 211/2011 regarding the waste regime, of Law no. 249/2015 regarding packaging and packaging waste management and of Government Emergency Ordinance no. 196/2005 regarding the Environmental Fund (hereinafter as "Emergency Ordinance" or "GEO 74/2018").
The Emergency Ordinance brings several legislative changes, in particular in the field of packaging and packaging waste management.
The legislative amendments were drafted with the purpose of aligning Romania with the European waste management legislation and of implementing the "pay-as-you-throw" economic instruments, the "extended producer responsibility" and the "landfill tax", as well as establishing the responsibilities of all the parties involved, including those changes resulting from promoting the circular economy package. Moreover, taking into account the European Commission approach, which is reflected in the circular economy package, a "contribution for the circular economy" has been established to replace the landfill tax.
I. Law no. 211/2011 regarding the waste regime
The main amendments relate to implementation of the "producer extended responsibility" principle, as follows:
- Defining the obligations of the central public authority for environmental protection with respect to the extended producer responsibility, by mentioning the roles and responsibilities of the involved parties, as well as the waste management targets;
- Specifying the conditions to be fulfilled by producers and entities which undertake to implement the obligations regarding the extended producer responsibility, namely performing the activity at the level of at least one county, managing a well-defined product range, owning sufficient financial and operational resources;
- Mentioning the obligations of the local public administration authorities, for example, the obligation to implement, as of 1 January 2019, the "pay-as-you-throw" principle.
II. Law no. 249/2015 regarding packaging and packaging waste management
The Emergency Ordinance brings significant amendments affecting the entire chain involved in the process of introducing packaged goods onto / sales of packaging materials on the national market, as well as in managing packaging waste. The main updates refer to the following aspects:
- Certain definitions were introduced into the legislation, such as “commercial and industrial packaging waste", "making available on the national market" and "guarantee-return system";
- Increasing the recovery / recycling targets for packaging waste, both for global and for each type of material targets, starting with 1 January 2019;
- Modifying the manner in which the recovery / recycling targets for packaging waste are met, starting with 1 January 2019: (i) individually - only by managing the producer’s own packaging placed on the national market, under certain conditions, or (ii) through an organisation specialised in implementing the extended producer responsibility. Until 31 December 2018, achieving annual objectives on an individual basis will continue to be carried out by managing both waste generated by the producer’s own activity and those taken from third parties;
- Establishing new conditions for the authorisation of the organisations specialising in implementing the extended producer responsibility. The authorities are to establish a detailed procedure for authorisation, through a subsequent legislative act.
- Economic operators managing packaging and packaging waste are implicitly registered with the Environmental Fund Administration when they submit their first environmental statement.
- Establish obligations for economic operators selling packaged products to end-users in medium and large sales areas, including: (i) giving consumers the choice of purchasing products packaged in reusable or single packaging use, (ii) provide consumers with take-back points and reimbursement of the money guarantee. From the perspective of environmental legislation, these economic operators will not be considered collectors of waste for packaging taken over from end-users;
- Changing the reusable packaging regime, as well as regulating the guarantee - return system for non-reusable primary packaging;
- Establishing new sanctions and increasing the fines imposed for non-compliance with the obligations of the parties involved in the management of packaging and packaging waste, as well as setting certain attributions related to these contraventions for the Environmental Fund Administration.
Specific provisions for the reusable packaging regime
The new legal provisions mention that reusable packaging materials must circulate either based on an exchange system (according to the accounting and tax regulations), or by payment performed by beneficiaries of a money guarantee in exchange for the received packaging.
As of 31 March 2019, the amount of the guarantee is RON 0.5/item of packaging material for reusable primary packaging, but the central environmental protection authority can modify that at the request of the business environment.
By 1 January 2021, based on an analysis of the effectiveness and impact of this system, the authorities are required to establish a return-guarantee scheme for non-reusable primary glass, plastic or metal packages with volumes ranging from 0.1 to 3 litres.
Some additional obligations have been established for economic operators introducing onto the national market goods packaged in reusable packaging materials. Such obligations include organising the taking-over of the reusable packaging in such manner that, as of 2019, at least 90% of the packaging is taken over and using the phrase "reusable packaging" on the primary packaging or the product label.
In addition, all economic operators introducing packaged goods onto the national market have to have, as of 1 January 2020, reusable packaging as 5%, on annual average, of their total packaging managed. That percentage has to increase annually by 5% until 2025.
Economic operators which introduce packaged goods onto the national market and repack packaged goods to be further resold, operators which place sales packaging onto the national market and those which rent out packaging are also responsible for taking over and recovering packaging waste from final-consumers. Moreover, these operators are obliged to implement the extended producer responsibility, to ensure the recycling or recovery of returned primary packaging which became waste.
Additional obligations are also provided for retailers selling goods packaged in reusable packaging materials, especially with respect to informing consumers regarding the amount of the guarantee, as well as to the taking over of the reusable packaging.
III. Government Emergency Ordinance no. 196/2005 regarding the Environmental Fund
The main amendment refers to the implementation of the circular economy principle, by replacing the landfill tax with a contribution for the circular economy to be paid by owners or administrators of municipal landfills. Unlike the former landfill tax, the amount of the contribution is to be reduced at RON 30/tonne for 2019, and RON 80/tonne, as of 2020.
The provisions of OUG 74/2018 entered into force on 19 July 2018, with the exception of the provisions regarding the definitions and the amounts of the fines provided by Law no. 249/2015 regarding waste management, which will enter into force in 30 days as of the moment the Ordinance is published in the Official Gazette.
Source: Government Emergency Ordinance no. 74/2018 for the amendment and completion of Law no. 211/2011 regarding the waste regime, of Law no. 249/2015 regarding the packaging and packaging waste management and the Government Emergency Ordinance no. 196/2005 regarding the Environmental Fund, published in the Official Gazette no. 630/19.07.2018]
OUG 74/2018 bring numerous legislative amendments in the field of environmental legislation, especially regarding the packaging and packaging waste management. The most important amendments refer to the following aspects:
- Implementation of the extended producer responsibility concept;
- Increasing the recovery / recycling of packaging waste targets;
- Changing the manner in which the recovery / recycling of packaging waste targets are achieved on an individual basis, namely only by managing the packaging waste related to the packaging materials introduced onto the national market by the economic operator;
- As of 1 January 2020, reusable packaging has to make up an annual average of at least 5% of the total packaging managed by economic operators introducing packaged goods onto the national market. That percentage has to increase by a further 5% of the total every year until 2025;
- Establishing additional obligations for the local public authorities and for the final consumers generating packaging waste;
- Changing the reusable packaging regime, as well as establishing the guarantee-return system for the non-reusable primary packaging;
- Establishing new penalties, as well as increasing the amount of the old fines applied for non-compliance with the obligations on the parties involved in the packaging and packaging waste management process;
- Defining the contribution for the circular economy and reducing the amount applied.
Considering the complexity of the legislative amendments adopted, we recommend that economic operators:
- analyse in detail the implications that may arise for their business;
- review or develop internal procedures to ensure compliance with the newly-adopted regulations;
- renegotiate contracts with suppliers of goods and services relevant for the management of packaging and packaging waste in such a manner that the contractual provisions and the supporting documentation ensure compliance with the new legislative amendments.