The First Minister this week announced that Scotland's Deposit Return Scheme, which had been scheduled to come into force on 16 August 2023, will now be delayed until 1 March 2024. This follows significant public criticism of the scheme's readiness from a number of producer and retailer quarters, though other businesses that have invested in establishing and preparing for the scheme are unhappy at the prospect of being left out of pocket by the delay. Whatever position businesses were in for the 16 August deadline, what should they be doing now?
The First Minister's announcement included reference to a package of measures to "simplify and de-risk" the scheme. This will presumably mean amendments to the Regulations. However, the additional delay to March will not be long enough to allow for a full redesign of the scheme, so the fundamentals are likely to remain as set out in our previous posts on producer and retailer obligations (and as also explained in our webinars).
Any changes are therefore likely to be aimed at tweaking some of the aspects of the scheme that have proved most controversial and/or difficult to manage. Amendments will need to be confirmed in the next two to three months to give producers and retailers enough notice of the final arrangements, and avoid the scheme being in the same uncertain position as the new deadline approaches. There may therefore be a limited window in which interested parties can seek amendments to remove or mitigate some of the difficulties or concerns they have with the scheme as currently drafted. That of course requires a clear understanding of how the scheme would apply 'as is', so any producer or retailer who still feels uncertain about that should feel free to get in touch.
Otherwise, producers and retailers who were not already on top of their preparations for an August commencement will be able to use the delay to get ahead of the deadlines for next time around. We know that many of the producers who declined to register by the original deadline of 28 February were concerned about signing up to the scheme administrator's producer agreement while certain key aspects remained TBC. Those producers should therefore be keeping a close eye on whether those gaps are filled in good time for the new registration deadline, which the administrator (Circularity Scotland Limited) has advised will be 12 January 2024.
Those producers who did sign up with CSL may be concerned that the producer agreement may now make them liable for at least some of the costs of the delay. Producers who are concerned about that should seek legal advice, as indeed should anyone who has incurred preparation costs that may now be wasted as a result of the delay.
The above is all still subject to the elephant in the room when it comes to the scheme, which is the still-outstanding question of whether the UK Government will grant an opt-out from the UK Internal Market Act 2020. While an opt-out is not technically a legal requirement for the scheme to go ahead, the absence of an opt-out would result in key aspects of the scheme being unenforceable against the majority of qualifying products, and so would in all likelihood result in the scheme not going ahead at all. Producers and retailers may therefore want to pause further spend on their own preparations for at least a few weeks, to see if that question is finally resolved. However, those who want to seek amendments to the scheme do not really have time on their side, and so would be well advised not to delay in making their views known to the Scottish Government on the amendments they would want to see.
For any assistance in relation to the Deposit Return Scheme, please get in touch with Charles Livingstone, Grant Strachan or your usual Brodies contact.
Contributors
Partner
Partner
