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Eco Contribution

MEPA PUBLISHES RECOMMENDATIONS TO GOVERNMENT ON REFUND MECHANISM FOR ECO-CONTRIBUTION

The MEPA Board has approved the publication of a draft policy document dealing with "Authorisation/Registration of Schemes - Eco-Contribution Exemption/Refund Mechanism".

The document makes proposals to Government on a framework within which Eco-Contribution refund mechanism could operate. The document proposes that producers participating in waste recovery schemes may become eligible for a refund of the Eco-Contribution paid on recovered items, upon providing documentary proof to MEPA that this recovery has indeed been done. In the context of the Eco-Contribution Act, a scheme is taken to mean as an organized and regulated framework that demonstrates that a particular waste producer is recovering the end-of-life products originating from products which s/he normally places on the market.

The Eco-Contribution Act was enacted in September 2004. The main objective of this Act is to provide for the levying of an eco-contribution on products which generate end-of-life products or waste, with the ultimate aim of ensuring better disposal/re-use/recycling management. Therefore, under the provisions of this Act, products falling within its scope would attract eco-contribution.

The Eco-Contribution Commission, which was established to advise the Government on the matter, concluded that a framework based on refunds as opposed to exemptions would be more appropriate and these should result in a better audit trail for the whole chain of products life-cycle. The Eco-Contribution Commission also considered that such a system would reward those companies with a higher percentage of recovered waste.

Under the framework proposed by MEPA, producers who provide documented evidence that they are recovering waste will be enlisted in the Eco-Contribution Scheme Register. Registration involves the submission of documented evidence of the quantity of goods put on the market and the quantity of waste recovered. Producers listed in the Eco-Contribution Scheme Register will be eligible for refunds on the amount of Eco-Contribution paid during the previous year, subject to a minimum recovery rate of 25%. For the first years, it is being proposed that a 100% refund will be given if 80% of the product put on the market is recovered.

This regulatory framework is an economic incentive that, given the necessary legal basis, could also be instrumental in maximizing the amount of waste that is recovered. Moreover, the framework is self-enforcing since producers are given the incentive to recover and will be rewarded when successful.

DRAFT POLICY DOCUMENT

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