What is EPR and why it’s important for businesses

Compressed plastic bottles ready for recycling — Photo by Nick Fewings on Unsplash

In recent years, the Philippines has made strong progress in tackling plastic waste and promoting sustainability. One major step is the Extended Producer Responsibility (EPR) Law, or Republic Act No. 11898. This law requires businesses to take responsibility for their plastic products—from production to disposal. An understanding of the EPR Law is important for businesses, as it influences regulatory compliance and also aligns with global sustainability trends.

Understanding Extended Producer Responsibility (EPR)

Extended Producer Responsibility is an environmental policy approach that holds producers accountable for the environmental impacts of their products throughout the product lifecycle, particularly at the post-consumer stage. The objective is to incentivize producers to design eco-friendly products, reduce waste, and enhance recycling and recovery efforts. By internalizing the environmental costs associated with their products, producers are encouraged to innovate and adopt sustainable practices.¹

A closer look at the EPR law in the Philippines

The EPR Law, enacted in July 2022, serves as an amendment to the Ecological Solid Waste Management Act of 2000 (Republic Act No. 9003). This legislation institutionalizes EPR as a mechanism to address the country’s plastic waste problem. The law requires large enterprises—defined as businesses with total assets exceeding PHP 100 million, excluding land—to develop and implement programs for the proper management of their plastic packaging waste.²

Key provisions of the EPR law:
1. Scope of coverage: The law targets plastic packaging waste, including single-use plastics, sachets, labels, and other packaging components.

2. Obligated enterprises: Businesses classified as large enterprises are mandated to comply with the EPR Law. Micro, small, and medium enterprises (MSMEs) are currently exempt but are encouraged to participate voluntarily.

3. EPR programs: Obligated enterprises must establish EPR programs that include strategies for waste reduction, recovery, and recycling. These programs should be designed to achieve specific recovery targets set by the law.

4. Recovery targets: The law sets progressive targets for plastic waste recovery, starting at 20% for the year following the law’s effectivity and increasing annually to reach 80% by 2028.

5. Reporting and compliance: Enterprises are required to register their EPR programs with the National Solid Waste Management Commission (NSWMC) and submit annual compliance reports. Non-compliance may result in fines and other penalties.

Brainstorming in action: Mapping out ideas on the whiteboard. — Photo by Kaleidico on Unsplash

Implications for businesses in the Philippines

The EPR Law presents both challenges and opportunities for businesses. Compliance necessitates a reevaluation of product design, packaging materials, and waste management practices. However, it also offers avenues for innovation and leadership in sustainability.³

Challenges:

Operational adjustments: Businesses may need to redesign products and packaging to enhance recyclability and reduce environmental impact.
Financial investment: Implementing EPR programs requires investment in infrastructure, technology, and processes for waste collection, recycling, and reporting.
Supply chain coordination: Companies must collaborate with suppliers, distributors, and waste management entities to ensure the effectiveness of EPR initiatives.

Opportunities:

Brand enhancement: Demonstrating a commitment to environmental responsibility can enhance brand reputation and appeal to eco-conscious consumers.
Market differentiation: Early adopters of sustainable practices can differentiate themselves in the market, potentially gaining a competitive advantage.
Global alignment: Compliance with EPR regulations aligns businesses with global sustainability standards, facilitating entry into markets with stringent environmental requirements.

The role of Plastic Bank in supporting EPR compliance
Plastic Bank’s role in assisting businesses to comply with the EPR Law can be simplified as follows:

By enabling the exchange of waste for value, Plastic Bank incentivizes members in underserved coastal communities to register as collection members, gather discarded plastic from the environment, and exchange it for secure income, social benefits, and financial inclusion.
Companies can partner with Plastic Bank to fund traceable plastic collection that is equivalent to the amount they need to recover from the environment for their EPR compliance.
Collected plastic is set up for recycling to get a second life and re-enter the global manufacturing supply chain, creating a circular economy that benefits both the environment and local communities.

Plastic Bank’s initiatives in the Philippines:

Community engagement: Plastic Bank has established collection branches across the Philippines, registering thousands of collection members. Collection members receive incentives above market rates for the plastic they gather, which can be converted into grocery vouchers, access to training, and accident insurance.
Corporate partnerships: Collaborations with corporations like Coca-Cola Philippines have amplified impact. For instance, their partnership aims to collect and recycle millions of post-consumer PET plastic bottles, preventing their likelihood of ending up in the ocean.⁴
Technological integration: Utilizing blockchain technology, Plastic Bank ensures transparency and traceability in the plastic collection process. This innovation provides businesses with verifiable data on their plastic recovery efforts, aiding in compliance reporting.⁵

Steps for businesses to achieve EPR compliance
1. Assess plastic footprint: Conduct a comprehensive audit of the plastic used in manufacturing products and packaging, and identify areas for reduction or substitution with sustainable alternatives.

2. Develop an EPR program: Design a program that outlines strategies for plastic waste reduction, collection, recycling, and public reporting.

3. Partner with accredited organizations: Collaborate with entities like Plastic Bank to facilitate the collection and recycling of plastic waste, leveraging their established infrastructure and expertise.

4. Engage stakeholders: Involve employees, suppliers, consumers, and local communities in EPR initiatives to foster a culture of sustainability and shared responsibility.

5. Monitor and report: Implement systems to track progress toward recovery targets and ensure timely submission of compliance reports.