Australian Packaging Reform: What You Need to Know About the Upcoming Changes in Packaging Regulation
The Australian Government is about to roll out some big changes in packaging regulations, aimed at reducing environmental impact and tackling waste. Starting in 2024, these reforms will set in motion a shift for businesses and consumers alike in how they approach packaging. These changes are in line with global sustainability trends and reflect a growing need to manage packaging waste more effectively.
Timeline for Packaging Reform
September to October 2024: The public consultation phase takes place, where businesses and stakeholders will have the opportunity to provide input.
November 2024: The Environment Ministers' meeting will discuss the preferred option, based on the feedback received during the consultation phase.
2026 Onwards: If agreed upon, new obligations will begin to take shape, but there will be a lead time for businesses to adapt and prepare for these changes. The regulation is expected to be enforced from FY27.
What Are the Reform Options?
The government is looking at three main options for these packaging reforms:
Strengthening the Co-regulatory Arrangements (Option 1)
The current system remains but with enhanced compliance and enforcement to reduce non-participation ("free riders").
Increased education efforts aimed at both industry and the community to promote behaviour change.
Support for the implementation of the Australian Packaging Covenant Organization’s (APCO) 2030 Strategic Plan.
National Mandatory Packaging Requirements (Option 2)
Mandated by Commonwealth legislation, with individual entities required to meet strict packaging standards.
Bans on problematic materials, minimum recyclability performance, and recycled content thresholds would be introduced.
The co-regulatory arrangement would cease under this model, shifting towards a stricter regulatory framework.
Extended Producer Responsibility Scheme (Option 3)
This option includes the introduction of eco-modulated fees that incentivize recyclable packaging designs.
Mandated requirements similar to Option 2, but instead of bans, fees are applied based on packaging types to encourage sustainable practices.
Fees collected could support both administrators and industries in meeting eco-friendly goals.
How This Could Change the Packaging Industry
Options 2 and 3 represent a significant departure from current packaging practices, pushing businesses to adopt more sustainable materials and processes. For example, there would be a focus on using post-consumer recycled content, recycling labels (ARL to be mandatory), with a particular emphasis on minimising harmful materials and chemicals. The consultation process will play a key role in shaping the final obligations, offering businesses a chance to influence the direction of the reform before the mandates are solidified.
What are Eco-Modulated Fees?
One standout feature of Option 3 is the introduction of eco-modulated fees, which encourage businesses to design packaging that is easier to recycle. But what exactly does this mean?
Simply put, eco-modulated fees are a system that rewards companies for designing packaging that’s easier to recycle. For example, packaging made from a single material or transparent plastic would be eligible for discounts. Businesses can also get reductions for using recycled content or passing recycling checks.
This system has already been successfully implemented in countries like the Netherlands, Belgium and France where companies can minimise the cost per kilogram of packaging if following a grading system such as RecyClass. It's a way to motivate businesses to make their packaging more eco-friendly by offering financial incentives.
Below is an example of how this system is working in the Netherlands, one of the early adopters of eco-modulated fees:
This system is in line with global efforts, particularly in Europe and as mentioned the Netherlands, to reduce plastic waste and promote circular, fossil-free packaging by 2050.
Small steps towards better packaging can make a big difference, encouraging producers to innovate and creating positive impact through their packaging.
What Businesses Should Do to Prepare
As these packaging reforms take shape, businesses need to be proactive. Getting involved in the public consultation process is key to having a say in the future of packaging regulations. It’s also a good time to start reviewing your current packaging practices and exploring more sustainable alternatives.
Not only will adapting to these new regulations ensure compliance, but it will also appeal to the growing number of consumers who prioritise eco-friendly products. The changes coming to the packaging industry are both a challenge and an opportunity for businesses to lead the charge in sustainability, paving the way for a greener future.
The DCCEEW consultation paper can be found here - don’t miss this opportunity to be heard!
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