Germany revises re-cycling scheme

BRIDGES Weekly Trade News Digest, Vol.2 no.22, 15 June 1998

Germany's upper house of parliament, the Bundesrat, May 29 voted to revise its nationwide recycling scheme—the so-called Green Dot program. Germany's major food retailers and distributors threatened to pull out of the Green Dot program over the payment of licensing fees: food retailers are required to pay a fee to the non-profit organization which administers the programme, including the recycling of recyclable food packaging on retailers' behalf.

However, major firms including the giant food-distributor Metro AG— which alone pays about US$14 million in annual fees to the programme—complained that independent bakers and butcher shops were not required to pay licensing fees, while still benefiting from the Green Dot programme. This, the major food retailers and manufacturers claimed, resulted in a competitive advantage for the independent bakers and butchers who saved an estimated US$16.8 million annually on Green Dot fees. The major food firms threatened to pull out of the Green Dot program all together if the law was not revised: this would most certainly have meant the economic ruin of the Green Dot program.

The Bundesrat voted May 29 to shift some of the burden of the licensing program onto the producers of paper, plastic and cardboard packaging. Producers had been exempt from paying the licensing fees previously. The major food manufacturers and retailers are expected to remain in the programme as a result of the legislative change. However, some of the sector is still opposed to certain aspects of the law, including mandatory quotas for returnable beverage containers, which the European Commission has warned could be a trade barrier for foreign firms.

The Green Dot programme is considered largely effective as a system for collecting and recycling bottles, cans and wrappers. Environmentalists support the program since it reduces the amount of waste going into landfills. A number of food industry officials would like to see more competition in the Green Dot program: at present, only one firm is chartered to run the nationwide program. Food manufacturers and retailers want to see more firms carrying out the Green Dot program in the hope that competition will drive down costs.

Bundesrat saves national recycling plan through revisions to packaging ordinance, INTERNATIONAL ENVIRONMENT REPORTER, June 10, 1998; Germany regulations: packaging decree revised, ECONOMIST INTELLIGENCE UNIT, June 8, 1998.