ACCC proposes to authorise new scheme for soft plastics recycling
The ACCC (Australian Competition & Consumer Commission) has issued a draft determination proposing to grant authorisation to establish a voluntary, industry-led scheme to collect and recycle soft plastic packaging from consumers.The scheme will be run by Soft Plastics Stewardship Australia (SPSA) and aims to increase the collection and recycling of soft plastic packaging from consumers, such as shopping bags and food wrappers. Initial members of the scheme are Woolworths, Coles, Aldi, Nestlé, Mars and McCormick Foods.
“It is clear that many Australians are concerned about the environmental impacts of soft plastic packaging and want to recycle it,” ACCC Deputy Chair Mick Keogh said. The ACCC has previously authorised the major supermarkets to engage in conduct as part of the Soft Plastics Taskforce to process the stockpile left over from REDcycle and to restart instore collection pilots until July 2026.
“We believe the proposed scheme will result in an environmental benefit as it aims to take over and expand the current in-store collection and kerbside pilots for recycling soft plastic packaging, meaning some soft plastics are likely to be diverted from landfill,” Mr Keogh said. “While we know that soft plastic recycling has faced many challenges in Australia, we consider that the SPSA scheme is an important stepping stone to expanding collections and recycling.”
The ACCC considers that these public environmental benefits outweigh any potential detriment to competition that results from the collaboration through SPSA’s scheme. The ACCC is proposing to grant authorisation for eight years and to include a reporting condition to ensure transparency of the performance of the scheme. An additional condition is proposed to ensure that there is no exclusive contracts with processors. The ACCC has also granted interim authorisation to SPSA to allow it to engage in part of the conduct now including the sharing of operational information and data to allow for existing arrangements of the Soft Plastics Taskforce to be transferred to SPSA.
Background:
According to data published by the Australian Packaging Covenant Organisation (APCO), between 2022 and 2023, more than 540,000 tonnes of soft plastic packaging was used by manufacturers in packaging their products, however only 6 per cent of this soft plastic was recovered. The soft plastic packaging comprised both business-to-consumer and business-to-business packaging (such as wrapping goods on pallets). It is estimated that 70% of soft plastic packaging is business-to-consumer.
The SPSA scheme is proposed to be funded through a levy on scheme participants based on the amount of business to consumer soft plastic packaging they place on the market, meaning the first occasion on which soft plastic packaging is supplied.
For example, when a manufacturer sells its product to a supermarket, the manufacturer will have placed the soft plastic on the market, or where a supermarket sells its ‘own brand’ products in its stores. Scheme participants may decide to pass on the cost of the levy through the supply chain, including to consumers.
The ACCC has previously authorised Aldi, Coles and Woolworths to work together to remediate the stockpile of soft plastics following the collapse of REDcycle soft plastics recycling program. The Australian Government, including the Department of Climate Change, Energy, the Environment and Water, is working to reform Australia’s packaging regulations to minimise packaging waste and pollution and build a circular economy for packaging. This reform is separate to this scheme.