What if the CEO asks me about… our exposure to packaging fees under EPR?

Published on 01 April 2025

The Producer Responsibility Obligations (Packaging and Packaging Waste) (EPR) Regulations 2024 (EPR Regulations) came into force on 1 January 2025. They will affect most businesses that supply packaging in the UK, particularly brand owners of branded packaged products, and those who import branded products into the UK from overseas.

1. Snapshot

The Producer Responsibility Obligations (Packaging and Packaging Waste) (EPR) Regulations 2024 (EPR Regulations) came into force on 1 January 2025. They will affect most businesses that supply packaging in the UK, particularly brand owners of branded packaged products, and those who import branded products into the UK from overseas. With new data reporting and recyclability assessment requirements already in force and (potentially significant) EPR fees payable from this October, it is important for businesses to get clear now on the requirements and the potential liability so they can prepare. Here we unpack ten practical considerations and key 'watch outs' for businesses getting ready to comply with EPR.

2. What is EPR and why does it matter?

The EPR Regulations require in-scope businesses to record and report data on household packaging supplied in the UK and, if they meet the required turnover and supply thresholds to be a 'large producer' (broadly >£2m annual turnover and >50 tonnes packaging), to pay EPR disposal fees to cover the local authority costs of recycling that packaging after use. These disposal fees could be significant, with the UK Government formally estimating they will bring in £1.1bn in the first year of EPR alone.

Note these requirements are in addition to the requirement to purchase PRNs/ PERNs from accredited waste reprocessors and exporters as evidence that packaging has been recycled, which rolls over from the previous packaging regime. Businesses must report packaging data and manage PRNs/PERNs through the government's online RPD system.

EPR disposal fees

The first 'assessment year' for EPR disposal fees runs from 1 April 2025 to 31 March 2026, and fees will be based on data reported for the previous calendar year. Broadly, EPR disposal fees will be calculated according to the weight in tonnes of household packaging that producers have supplied in the UK in the previous calendar year, which could mean significant additional costs for businesses operating in packaging-heavy sectors, or for UK brand owners supplying large volumes of branded packaged products in the UK. The UK Government has recently published illustrative base fees for different types of household packaging (glass, aluminium, plastic etc) which will give businesses a sense of the likely additional costs. The final base fees are expected to be published in June 2025 and the EPR scheme administrator, PackUK, will issue invoices for these disposal fees in October 2025.

'Eco-modulation'

From 2026, EPR disposal fees will be 'eco-modulated' meaning the level of fees payable by a business will increase or decrease depending on the environmental impact and recyclability of the packaging supplied. This is good news for businesses, as they will be able to reduce the level of EPR fees payable over time by phasing in alternative and more sustainable packaging that is easier to recycle. All large producers must now conduct recyclability assessments for household packaging supplied from 1 January 2025 and report it as 'red', 'amber' or 'green' in line with recent Government guidance (also see this decision tree). This data will be used to determine the eco-modulated fees payable in 2026.

3. Key practical considerations and 'watch outs':

Below we unpack ten practical considerations and key 'watch outs' for businesses getting ready to comply with EPR:

Assess if you're in scope: assess whether you are in-scope of the EPR Regulations and, if so, to register with the appropriate environmental regulator before 1 April 2025. For branded products supplied in the UK, the brand owner will generally be liable (although this is subject to exceptions), and it is generally only if there is no UK-based brand owner that a packer/filler, importer or distributor will be liable instead. The EPR Regulations are complex and not always clear, so it is important to get legal advice on the exact scope of the business's obligations. Make sure you agree with your suppliers/ customers which entity is liable for EPR and bake this into your commercial agreements to mitigate the risk of dispute further down the line.
Impact on overseas brands: overseas brand owners that are 'established in the UK' will be liable for EPR fees for all branded packaging supplied in the UK (whether themselves or via distributors/ licensees). Note that the threshold for being 'established in the UK' is low and can mean as little as having a branch or postal address in the UK (e.g. having a PO box, office, warehouse, or domestic premises in the UK). Overseas brand owners should check now if they are in-scope of EPR and, if so, get clear on their legal obligations.
Check what packaging data to report: if your organisation has not already been keeping records and reporting packaging data to the relevant environmental regulator, check what you need to report and ensure that you submit any data promptly (including ahead of the next deadline of 1 April 2025). Get clear on the exact scope of the data to report. Inadvertently over-reporting your packaging data could result in additional disposal fees that would otherwise not be payable. On the flip side, under-reporting could result in enforcement action by the environmental regulators with the potential for fines and reputational damage. The environmental regulators are now beginning to audit businesses to ensure they have reported the correct data, so make sure your house is in order. Note that the deadline for reporting 'nation data' (i.e. information about which nation of the UK packaging is supplied/ discarded in) and 'self-managed organisation waste' (i.e. waste you have collected on-site for recycling) has recently been pushed back to 2026 to give businesses more time to comply.
Start your recyclability assessments now: start conducting your recyclability assessments for household packaging now to determine whether it is classified as 'red' (difficult to recycle), 'amber' (recyclable but with challenges/limitations), or 'green' (widely recyclable). This will impact the 'eco-modulated' disposal fees payable from 2026 onwards – with lower fees for 'green' packaging and higher fees for 'amber' and 'red' packaging. The results of these recyclability assessments must be reported to the environmental regulators by 1 October 2025 (for household packaging supplied in the period 1 January – 30 June 2025). Legal and sustainability teams can use the results of these recyclability assessments to help drive packaging re-design with stakeholders and key decision-makers internally to reduce the business's environmental footprint and reduce its EPR liability over time.
Check what counts as 'household packaging': get clear on whether you are supplying household packaging. The definition of 'household packaging' is very broad and covers some items you might not expect (and which may, in fact, be unlikely to end up in household bins). Under the current EPR Regulations, this includes packaged products supplied to hospitality/ the on-trade (unless very narrow exceptions apply). There are increasing calls from industry for the UK government to exempt on-trade products from EPR fees through an amendment to the legislation. This is due to the risk of hospitality businesses being double-charged and having to pay both EPR fees (which are passed on from their suppliers) and commercial waste management fees. The government has recently published guidance to help businesses assess what qualifies as household packaging and what does not.
Commonly binned packaging: Note that EPR disposal fees also apply to certain categories of 'commonly binned packaging' such as takeaway cups/boxes for food and drink, packaging for confectionary and savoury snacks (like chocolate wrappers and crisps packets) and packaging for cigarettes, e-cigarettes and vaping refills. Make sure you are reporting the correct data and work with legal advisors and relevant trade associations to understand how EPR applies to your products and sector.
Tread carefully with exclusive licences: where exclusive distribution licences change hands between licensees, get clear on which entity is liable to pay EPR disposal fees. Whilst the UK Government has issued guidance on this, it is important to build this into distribution agreements now to ensure clarity and minimise the risk of legal disputes when EPR invoices are issued later this year.
Plan for EPR disposal fees: only large producers (those with > £2million annual turnover and supplying >50 tonnes of packing per year) have to pay EPR disposal fees. Check whether you meet the thresholds and, if so, work with the business to ensure it can cover the EPR fees when they are due in October 2025. Check the latest illustrative base fees to help the business budget for likely EPR liability. The final base fees are due in June 2025.
Check the overlap with DRS: businesses in the drinks industry should get clear on which packaging is in scope of EPR. Single-use drinks containers made of PET plastic, aluminium or steel between 150ml to 3litres are not in scope of EPR (and will instead fall under the Deposit Return Scheme), however producers must still report sales of these containers to the environment regulators under a separate 'drinks containers' category. Under current rules, if there is no DRS in place by 1 January 2028, these containers will come into scope of EPR. Note that glass drinks containers are in scope of EPR.
Monitor EPR developments: there will likely be changes to the EPR scheme in year two. As well as the introduction of eco-modulation (see above), Defra and the Devolved Governments are currently drafting an amending SI which will make changes to the EPR Regulations to improve operational efficiency of the EPR scheme and address issues flagged by stakeholders (including some of those above). The draft SI will be notified to the EU over the summer 2025 and laid before the UK Parliament in the Autumn 2025.

Key dates to watch out for:

1 April 2025:

deadline for registering with the environmental regulators and reporting data for packaging supplied from 1 July – 31 December 2024
further updates expected from Defra on eco-modulation of EPR fees

mid-April 2025 : updated version of the Recyclability Assessment Methodology (RAM) for packaging expected to be published (this updates the previous version from December 2024). The updated RAM will apply to recyclability assessments for packaging supplied in 2025

June 2025:

final version of the EPR base fees published (taking into account latest data reported by producers up to 1 April 2025)
deadline for PackUK to publish policy statement on eco-modulation of EPR fees.

1 October 2025 – deadline to report data for packaging supplied from 1 January – 30 June 2025, including first reporting of recyclability assessments for packaging supplied during that period