As of January 1, 2022, a deposit system for disposable beverage packaging will be introduced in Slovakia. Some disposable beverage packaging manufacturers and distributors will therefore have new obligations.
On December 1, 2019, Act No. 302/2019 Coll. on the deposit for non-refillable beverage containers (the “Deposit System Act”) partially entered into force. So far, only the provisions on establishing the deposit system are effective. Provisions on materially introducing the deposit system come into force on January 1, 2022.
Which Disposable Beverage Containers are Subject to the Deposit?
The deposit system will apply to single-use beverage containers placed on the market in the Slovak Republic. The following single-use beverage containers will be subject to the new deposit system rules: plastic packaging (bottles) with a filling volume between 0.1 and 3 liters; and metal packaging (cans) with a filling volume of between 0.1 and 3 liters.
Administrator of the Deposit System
In December 2020, the Slovak Ministry of Environment appointed a deposit system administrator to coordinate the functioning and financing of the system. Prior to implementing the deposit system, the deposit system administrator will enter into a performance contract with single-use beverage packaging manufacturers and distributors. The Deposit System Act regulates which single-use beverage packaging distributors are required to enter into performance contracts with the deposit system administrator (i.e., not every such distributor has to enter into a contract). Disposable beverage packaging distributors who do not have this obligation can voluntarily register with the deposit system (see below).
Obligations of Single-Use Beverage Packaging Manufacturers and Distributors
The deposit system entails new obligations for single-use beverage packaging producers and distributors. Each non-refillable beverage packaging manufacturer and distributor must, in principle, add the deposit to the beverage packaging and retain the deposit amount determined by the administrator. Further, they should keep separate accounting records of the price of the goods (the sales price) and the amount of the deposit, as well as of the beverage packaging. This recorded data must then be reported to the administrator. In addition, each single-use beverage packaging producer must register the beverage containers with the administrator and reimburse the administrator for the deposit and costs associated with participation in the deposit system.
Single-use beverage packaging distributors selling beverages subject to the deposit system on a sales area of at least 300 square meters have additional obligations. For example, they must register with the administrator as a packaging collection point, collect packaging waste at their premises or within 150 meters of their premises, and repay the deposit to end users when they return the pledged beverage packaging. However, distributors who sell beverages in addition to their main products (e.g., drugstores) are not subject to these obligations. Such distributors and distributors with a smaller sales area can, however, voluntarily join the deposit system.
The obligations arising from the deposit system also apply to foreign companies that place beverages in non-refillable packaging on the Slovak market or transport them – or have them transported – across the state border of the Slovak Republic in order to place the beverages on the market or distribute them in the Slovak Republic. These foreign companies have the same obligations as Slovak companies if they place beverage products on the Slovak market.
Disposable beverage packaging manufacturers and distributors face new costs, including the following:
Labelling Beverage Packaging: Since only properly labelled beverage packaging can be registered with the deposit system administrator and placed on the market, single-use beverage packaging manufacturers must adapt production to the new legal requirements.
Construction Changes: Disposable beverage packaging distributors must provide a special place for beverage packaging to be collected in accordance with hygiene requirements as well as occupational health and safety requirements. Conversion work will be necessary in many business premises, which represents an additional financial burden.
Collecting Machines and Their Maintenance: The obligations of single-use beverage packaging distributors do not end with securing a place for packaging collection. Another burden will be purchasing and maintaining collection machines.
Further Administrative Work: In addition, single-use beverage packaging distributors will also face new administrative costs related to the new registration and record-keeping requirements.
As mentioned in the introduction, the new obligations will come into force on January 1, 2022. The Deposit System Act sets forth a range of fines for violations of individual obligations, with amounts depending on the specific violation. We therefore recommend preparing for these obligations in good time.
By Lukas Syrovy, Partner, Havel & Partners
This Article was originally published in Issue 8.2 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.