Another step towards a recycling economy - the extended producer responsibility scheme

The economic model based on single consumption is polluting and wasteful, therefore the implementation of a circular economy has become one of the main goals of the European Union’s environmental and economic policies in recent years. The idea is to extend the life of products as much as possible and minimise waste, rather than consuming them once.

Therefore, as of 1st July 2023, the rules of the Extended Producer Responsibility Schme e (hereinafter “EPR”) shall also be applied in Hungary for the manufacturers of the circular products listed below.

Essentially, the producers should take the financial responsibility for the post-of-life waste management of their products.

The following products are to be considered as circular products based on the EPR regulation:

• packaging (such as consumer-, collective- or transport packaging),
• single-use and other plastic products (e.g. food containers, drinks bottles, drinks cups, wet wipes),
• electrical and electronic equipment (e.g. monitors, entertainment electronic equipments, household appliances),
• battery, accumulator,
• vehicle,
• tyres (e.g. new tyres of customs tariff number 4011),
• office paper (e.g. goods under the customs tariff number ex. 4820, business books, notebooks),
• advertising paper (e.g. books, newspapers, pictures and printed matter of product group ex 49),
• cooking oils and fats, (e.g. olive oil under the customs tariff number 1509 40 00),
• certain textile products (e.g. garments under the customs tariff number 4203, knitted or crocheted of product group 61, footwear of product group 64),
• certain wooden furniture (e.g. convertible seats of customs tariff number 9401 41 00, 9403 30 wooden office furniture of customs tariff number).

An extended producer responsibility fee obligation arises when the manufacturer distributes circular product. According to the Waste Act, the producer is the manufacturer of the product, if the product is not manufactured in Hungary, the first person who distributes the product on the market in Hungary within its economic activity.

Distribution is to be considered for the purpose of the extended producer responsibility fee: 

• ownership of the circular product

• first domestic transfer for consideration or
• e.g. transfer from a foreign webshop to a domestic market, households or other recipients,

including the transfer of ownership as an accessory or component part of another product, with the exception defined in the EPR regulation (e.g. the transfer of a circular product in the context of a non-economic activity is not to be considered as distribution);

• for own use or
• removal of the circular product from a VAT tax warehouse or from a product fee warehouse under the Environmental Product Fee Act to the territory of the country.

According to the EPR regulation, an own use arises in case of a circular product, including as an accessory or component part of another product, used in the course of an economic activity

• use for the manufacturer’s own private use or that of an employee, as defined in the Act on Accounting,

• basic research,
• applied research,
• experimental development,
• investment,
• renovation 

consumption during a maintenance or any other use not mentioned above, including use, consumption during of the supply of services, which does not result the creation of own stocks as defined in the Accounting Act, if the product turns to waste after use in the country.

The EPR regulation imposes the following obligations on the manufacturer:

• Registration. They have to submit an application to the waste management authority (county government office) until 31st May with the data specified in the EPR regulation. Those who start distributing circular products after the entry into force of the EPR regulation, must apply for registration before the beginning of their activities. 

• They must provide quarterly data to the waste management authority by the 20^th of the month following the quarter in question, using a form, on the products placed on the market.

• The extended producer responsibility fee is to be paid on a quarterly basis to the concession company (MOHU MOL Hulladékgazdálkodási Zrt.) on the basis of an invoice issued by the concession company within 15 days after receipt of the invoice.

A detailed explanation of the obligations of manufacturers, as well as legislative changes related to the introduction of the EPR and the environmental product charge, will be discussed in the following parts of this blog post.

LeitnerLeitner provides the following services in fulfilling the obligations in connection with the EPR:

• providing support to fulfil the registration (to MOHU MOL) and notification obligations (to the waste management authority)
• classification of enterprises activity on the basis of EPR regulation classification of the products manufactured (distributed) and their parts and accessories
• EPR recording, development of product codes for circular products
• the classification of products under the EPR tariffs
• assistance in fulfilling reporting obligations
• advice on EPR-related invoicing rules, modification of accounting software
• fulfil EPR obligations as an authorised representatives in the case of a manufacturer established abroad or an online shop abroad
• advice on the assumption of EPR liability and individual fulfilment
• assistance in splitting the payment of the environmental product charge and the EPR