18 November 2020

Distance Selling and Extended Producer Responsibility

Did you know that if you are selling products through your own online shop or an online shopping platform, Extended Producer Responsibility (EPR) obligations may apply?

In essence, companies who use means of distance communication (for example an online marketplace) fall within the definition of a producer as defined by the EU WEEE Directive (2012/19/EU). As waste of electrical and electronic equipment (WEEE) is a fast-growing waste stream, the European Commission included distance sellers in this legal framework already many years ago. As the actual obligations are defined on the member state level, the question what a distance seller is obliged to do in each country is not easy to answer and requires detailed analysis.

The obligation of an e-commerce company can already start with the sale of the first product. While the regulations on batteries and packaging are yet to be fully harmonized, in most countries in Europe, an obligation exists under the WEEE regulations. However, we do observe a push towards more harmonisation for all fields of EPR. Governments are increasingly targeting online sellers because the current EPR laws are incompatible with online marketplace business models as e-commerce companies often free ride the local producer responsibility systems.

This situation creates unfair market conditions for local producers, and as a result, some countries are already undergoing a shift in the approach to distance sellers. A current example can be observed in Finland, where a revised Waste Act will enter into force in 2021 and also cover foreign e-commerce companies for producer responsibility on batteries and packaging. Furthermore, Germany recently published a draft amendment to the WEEE Act which includes proposals for making EPR obligations enforceable on cross border direct sales. The draft outlines new obligations of online marketplaces and fulfilment service providers which will have to verify if the sellers they service are compliant. On European Union level, a step towards more harmonisation will be made by EU Regulation 2019/1020 which underlines the fact that non-compliant products can distort competition. The Regulation, which will directly take effect on 16th July 2021 in all Member States, will bring forward intensified compliance controls within countries and across borders.

In essence, we see that it is important that enforcement of these rules takes place to ensure fair competition for all market participants and make sure that local companies are not put at a commercial disadvantage. If you are unsure about your obligations and want to stay up to date on changes of EPR regulations, CCR can support your company in monitoring your producer responsibilities and make sure that you are complying with relevant rules!