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EUROPEN Welcomes EU Commission Communication on Beverage Packaging

BRUSSELS - 11 MAY 2009 – EUROPEN, The European Organization for Packaging and the Environment, has welcomed the release last Friday of a European Commission Communication on beverage packaging, deposit systems and free movement of goods (1). The Communication long awaited by industry since the 2006 Commission report on The Impact and Implementation of the EU Packaging Directive, deals with regulations to promote beverage reuse systems. It reflects the experience gained from major infringement cases in countries such as Germany, Denmark, the Netherlands and Hungary.

The Commission Communication includes commentary on four issues of vital interest to the packaging chain and in particular the beverage sector: the question of measures to promote beverage reuse systems, deposit legislation, quantitative restrictions for single use containers and tax-based systems which differentiate between drink categories.

Reuse Systems

The Communication states that the Packaging and Packaging Waste Directive (PPWD) “does not establish a clear hierarchy” between reusable and single-use packaging and confirms in a footnote that the PPWD is a lex specialis in relation to the recently revised EU Waste Framework Directive (WFD) meaning that PPWD takes precedence over WFD and is not subordinated to the stricter hierarchy of the WFD.

Deposits

The Communication offers practical guidance to Member States on the use of mandatory deposit systems concerning single drinks containers suggesting that when such systems are adopted a transitional period of “at least one year seems necessary”.  The Commission also warns that imposing “exclusive national logos and country-specific EAN codes should be avoided” in principle.

Concerning Member States’ right to set up mandatory deposit systems for non refillable containers, the Commission recalls that such systems “create barriers to trade” affecting imports, but also exports, re-imports and parallel imports. To justify such trade barriers, the environmental necessity for mandatory deposits (as opposed to general collection systems) must be shown by the Member State authorities as deposits “may” increase collection rates and “may” help prevent litter.  This point is in agreement with a March 2006 paper (2) in which EUROPEN recommended “that the European Commission and Member States practice greater vigilance in ensuring that any measures adopted to encourage reuse systems of packaging are in full conformity with the internal market and competition obligations of the Treaty, as well as with recent judgements of the European Court of Justice.”

Quantitative Restrictions for Single-Use Beverage Containers

The Commission issues a strong warning concerning the link between reusable beverage container market shares and a mandatory deposit for single-use containers.  Examples such as the Danish ban on beverage cans, obligations by the Netherlands on economic operators to prove by life cycle analysis that single-use is not more harmful environmentally than refill bottles and the German refill quotas case.

Tax-based Systems

Finally, the Commission summarises its recent Reasoned Opinion issued in a case concerning Hungary where differentiated tax treatment between drinks categories is in principle illegal.

Commenting on the Commission Communication, Julian Carroll, EUROPEN’s Managing Director said he was sure that all economic operators in the packaging value chain would welcome the Communication of the Commission and expressed the hope that its existence will now curb time consuming and costly interventions by some regulators which frequently have little or no environmental justification.

Bob Schmitz, a member of EUROPEN’s Internal Market Work Group and Legal Council for Beverage Can Makers Europe said although the Communication is not legally binding it provides useful warnings to Member States when applying the provisions of articles 5 and 7 of the Packaging and Packaging Waste Directive.  The Communication presents a consolidation of the legal findings by the EU court and Commission in the numerous beverage cases brought to their attention.

Background Note to Editors

EUROPEN and trade associations connected to the beverage sector have consistently urged the European Commission to issue such a legal clarification because of the market disruptions the beverage sector has experienced in Europe as a result of legislation adopted by some EU Member States as confirmed by the Commission itself in its 2006 report (3) on the impact of the Directive.  In that report the Commission stated “despite the Directive’s aim to contribute to the functioning of the internal market and to reduce trade barriers, these goals have not been fully achieved for all types of packaging”.  “In particular, the infringement procedures in the beverage sectors show that national measures can lead to distortions of competition and in some cases partitioning of the internal market, which contradicts the objectives of the Directive.”  The Commission committed itself to react to any such measures that risk disrupting the functioning of the internal market and it promised to further evaluate the need to clarify or amend the provisions of articles 5 and 7 of the Packaging Directive.  This Communication is the promised Commission follow up.

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(1)  C(2009) 3447 final, Brussels, 8. 5.2009.  Communication from the Commission:  Beverage packaging, deposit systems and free movement of goods.
(2)  The EU Packaging and Packaging Waste Directive: Implementation and Impact.  Comments and recommendations from EUROPEN  based on two studies conducted for the European Commission, March 2006
(3)  See COM(2006) 767 final, Brussels, 6.12.2006.  Report from the Commission to the Council and the European Parliament on the implementation of Directive 94/62/EC on Packaging and Packaging Waste and its impact on the environment, as well as on the functioning of the internal market.