The Extended Producer Responsibility system (in short EPR) operating within the framework of the concession system will enter into force from 01 July 2023 as one element of the reform of the waste management system in Hungary, which is being introduced for the purpose of harmonization with EU recycling standards and waste management legislation. In addition, from 01 July new rules regarding the environmental protection product fee will also apply. In this article, we briefly present the rules of the EPR system based on the government decree No. 80/2023. (III.14.), and we also cover the changes related to the product fee.
Under the EPR system, the producer (who is as a general rule the first distributor of the product in Hungary) will bear the financial responsibility for waste management after the product becomes waste by the payment of a so-called EPR fee. The waste management (including, inter alia, the takeover, the transportation and the management of waste) will be financed by the above fee and will be implemented under collective performance by the concession company called MOHU MOL Waste Management Ltd. Individual performance (meaning that the producer itself is responsible for the waste management) will be possible in limited cases, in which case the producer will have to conclude a contract with MOL.
1. Circular products belonging to EPR system
The extended producer responsibility fee will have to be paid for the following so-called circular products that fall under the scope of the EPR system: packaging (the producer of the packaging is the person who carries out the packaging); disposable plastic products (including food and drink containers, plastic carrier bags and wet wipes); electrical and electronic equipment; batteries; vehicles; tire; office and advertising carrier paper; cooking oil and fat; textile products and wooden furniture. Among these products, there are some products that are also subject to an environmental protection product fee (e.g. batteries, electronic equipment, tires and packaging materials used for packaging).
2. The payment obligation
The producer is obliged to pay the EPR fee, similarly to the product fee, after the first domestic distribution of the product. A company using the circular product for its own purposes will also be subject to the payment of the EPR fee. In addition, foreign online stores distributing circular products to Hungarian costumers will also have to pay the EPR fee.
Important practical information regarding the payment of the EPR fee is that from 01 July 2023, the amount of the EPR fee can be deducted from the amount of the product fee (in case of products that are subject to both a product fee and an EPR fee), in order to avoid double payment. In the case of packaging materials, the EPR fee for the packaging can be deducted from the product fee payable for the packaging material.
3. Registration and data reporting
All producers already engaged in activities related to circular products will have to submit an application for registration to the competent government office by 31 May 2023, and in the future, new producers will have to apply for registration before starting the above activity.
As in case of the distribution of products subject to a product fee, data reporting every 3 months will be mandatory for the distribution of circular products as well. In the case of the sale of circular products, there will be an obligation to indicate information regarding the payment of the EPR fee on the invoice.
4. Changes related to the environmental protection product fee
In addition to the above-mentioned possibility to deduct the amount of the EPR fee from the product fee, changes will apply from 01 July regarding the customs tariff numbers for product fee products, the scope of the products that are subject to a product fee, the product fee payment obligation of foreign online stores, and regarding the product fee for the distribution of electrical and electronic equipment in small quantities.
Should you need more information on the detailed regulations, the colleagues of our Legal Partnership are at your disposal to provide you with some more information.
BALÁZS & KOVÁTSITS Legal Partnership