Delay: Deposit Return Scheme (DRS) for drinks containers across the UK is delayed until October 2027

On 25^th of April 2024, in a written ministerial statement the UK Government announced that the DRS for drinks containers due to be rolled out across the UK, has been delayed until October 2027. This applies to England, Northern Ireland, Wales & Scotland. The previous date for DRS roll-out was October 2025, though this was always a stretching target for Government. Following extensive engagement with industry, as the responsible party for delivering the DRS, UK government have determined that more time will be needed to efficiently and effectively roll out DRSs across the UK.

There will be 3 legally separate DRSs across the UK, defined as such as they will have separate Regulations. England and Northern Ireland will have a joint DRS; the Draft Statutory Instruments for this joint DRS has been notified to the World Trade Organisation (WTO) on the 25^th of April 2024. Wales intends to bring forward its own separate Regulations, and Scotland will need to amend the Regulations (as amended) which are already in force.

Materials in scope:

As it stands, the containers and materials in-scope of each DRS:

The UK Government has published a statement which sets out the position on glass drinks containers within the English DRS. This policy statement outlines that the position on glass within the English DRS is unchanged and inclusion of glass would create undue complexity for the drinks industry as:

• Increased storage and handling costs for retailers
• Glass containers are heavy and fragile, so would be more difficult for consumers to return and receive the deposit they paid
• Glass is littered less: 2020 research found that 55% of litter was from PET plastic and metal drinks containers, whereas only 5% was from glass drinks containers.

The Welsh government intend to include glass in their DRS. UK Government have outlined that they are aiming for interoperability (meaning that the UK DRSs will align), so they will continue conversations with the Welsh Government. But if the Welsh position does not change, the UK Government has stated it will reiterate the duty to protect the UK internal market and facilitate free trade within the UK.

This follows the collapse of the Scottish DRS which was due to go live in 2023, due to UK Government declining the Scottish Government’s application for exemption from the UK Internal Market Act. This is because of the UK Government’s aims for interoperability and alignment of DRSs across the UK. The UK Internal Market Act seeks to prevent internal trade barriers among the four constituent countries of the United Kingdom. This meant that Scotland could not include glass within its DRS, which resulted in the roll out of the scheme was delayed and Circularity Scotland Ltd (the scheme administrator) went into administration.

Key UK DRS updates

UK Government held a DRS policy update webinar on 30th May 2024. They shared several updates to the plans for DRS implementation across the UK:

• Registration: There will be a single registration process for all UK DRSs. This process should be developed and managed by the Deposit Management Organisation(s) (DMO(s)). Producers of drinks products in-scope of DRS must be registered with the DMO in the nation where the products are sold, to enable retailers to sell these products.
• Low volume sales exemption: Product lines with less than 5,000 units placed on the UK market per annum will be exempt from the obligation to place a deposit on containers. Although, these products will still be subject to DRS reporting requirements.
• In-scope containers: Containers between 150ml and 3L are in-scope of all UK DRSs. Containers out of scope of DRS, will be in-scope of packaging EPR i.e. drinks containers 149ml or below are in-scope of pEPR.
• Labelling: There will be a DRS label and a single approach to this across all UK nations. This will be determined by the DMO(s).
• Returning drinks containers: Drinks containers purchased anywhere in the UK can be returned anywhere in the UK however return point operators are only required to accept containers that are in-scope of the nation (i.e. glass containers that have had a deposit applied in Wales cannot be returned for a refund in England).
• Deposits: The DMO(s) will be responsible for setting the deposit level. Deposit level must be aligned across the UK. There is an option for the DMO(s) to set variable deposit level based on container material, size or type.

Next steps for DRS implementation

Within the DRS policy update webinar on 30th May 2024, UK Government outlined the next steps for DRS implementation within three phases:

Phase 1: by Spring 2025

• The UK Governments will be finalising the Statutory Instruments and will lay these in Parliament.
• Defra will also continue to work on appointing the DMO(s) from industry and are aiming to have this complete by Spring 2025.
• Defra will continue to engage via forums and via sector specific sub-groups.

Phase 2: between Spring 2025 and Spring 2026

• The DMO(s) will take some time to establish itself, which Defra are allowing a year for during phase 2 of the timeline. The DMO(s) will need to ensure it is capable of running DRS on behalf of industry in each administration within the UK, and providing businesses with the information they need to prepare for DRS launch. This will include securing funding, appointing a leadership team, and designing and publishing decisions on key operational areas.

Phase 3: Roll out: between Spring 2026 – Autumn 2027

• This phase is for businesses to make the changes required for DRS. The DMO(s) will also need to establish the necessary national collection and IT infrastructure, retailers procuring and installing reverse vending machines (RVMs), labelling activity, system wide testing, and commencement of consumer engagement.
• The DRSs will launch in October 2027.

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