Waste reduction through environmental regulation

The Product Stewardship Act 2011 (Act) was introduced into Federal Parliament as a Bill on 23 March 2011 and assented to on 25 July 2011. Although it is expected that the Act will take effect in August 2011, the real impact will be felt by business when the regulations under the Act come into effect. Currently there are no Regulations and no plan for any industry yet exists.

Background

The Act establishes a product stewardship scheme so that relevant parties in a product chain will share responsibility for the products they produce, handle, purchase, use and discard.

The Act sets a framework for reducing the environmental and other impacts of products by encouraging or requiring manufacturers, importers, distributors and other persons to take responsibility for these products.

Objects

The objectives of the Act are to:

• reduce the impact that products and the substances contained in products have on the environment and on the health and safety of human beings throughout the lives of those products;
• contribute to Australia meeting its international obligations concerning environmental impacts; and
• contribute to reducing the amount of greenhouse gases emitted, energy used and water consumed.

These objects are to be achieved by encouraging or requiring manufacturers, importers, distributors and others to take responsibility for products through:

• avoiding, reducing or eliminating the generation of waste;
• reducing or eliminating hazardous substances in products and in waste from products;
• managing waste from products as a resource; and
• ensuring that products and waste from products are reused, recycled, recovered, treated and disposed of in a safe, scientific and environmentally sound way.

Product stewardship

The framework under the Act provides for three types of product stewardship: voluntary, co-regulatory and mandatory.

The intent of the voluntary scheme is to encourage product stewardship without the need for regulation and provide the community with more certainty, through the use of a logo, that accredited schemes are actually achieving what they claim. There will be audit and reporting obligations to provide transparency and accountability under the voluntary scheme.

The co-regulatory scheme will be delivered by industry with only outcomes and basic operational requirements specified in the regulations. A company will not be able to benefit from refusing to participate and thresholds may be applied to avoid impacts on small business.

The mandatory scheme will set obligations for parties to take certain actions in relation to a product. These obligations can require:

• product labelling;
• producers to take products back at the end of life for recycling; or
• a deposit and refund to be applied to a product.

Penalties

The Act contains provisions for civil and criminal sanctions, enforceable undertakings and infringement notices. Pecuniary penalties can be imposed both on a corporation as well as individuals.

Impact

The introduction of the Act is expected to have far-reaching implications for most businesses, in particular, manufacturers, producers, importers, financiers and banks.

The first regulations to be made under the Act will introduce a National Television and Computer Product Stewardship Scheme, which is expected to be phased in by the end of 2011. Under this scheme, manufacturers, importers and suppliers of televisions, computers and computer peripherals will be required to fund and implement national collection and recycling systems. We anticipate that draft regulations will be released in the near future.

Further detail will be provided on the Act and its regulations when it comes to light. Cooper Grace Ward will hold a seminar in October on a date to be advised on the implications of the Act.

Please contact David Grace via david.grace@cgw.com.au for further enquiries relating to this publication.

Authored by David Grace and Michelle Hyams.