Packaging Waste Recovery Note

A Packaging Waste Recovery Note (PRN) or Packaging Waste Export Recovery Note (PERN) is the tradable evidence that demonstrates that an 'obligated company' (i.e. a company, business or organisation that falls within the remit and/or threshold of the Packaging and Packaging Waste Directive) has met its responsibilities under The Producer Responsibility Obligations (Packaging Waste) Regulations 1997, as amended.

Background

The Producer Responsibility Obligations (Packaging Waste) Regulations 1997, as amended, introduces obligations on producers to provide financial incentives to the packaging recycling industry to collect and reprocess (or export for reprocessing elsewhere) sufficient material to meet the targets set by the Government - a direct application of the Polluter Pays Principle. Targets are set annually for Packaging Waste recycling and these are listed on the Packaging Waste page.

PRNs can be delivered by producing evidence by an 'obligated company' or can be purchased from a Reprocessor of Packaging Waste (issued as evidenced with the Regulator) to deliver against the producer’s obligations whereas PERNs are issued at the point of export to a Reprocesser outside the UK. The values of PRNs and PERNs fluctuate with the targets set for Packaging Waste recycling annually, the volume of material available in the market and other factors such as oil prices, secondary raw material prices and exchange rates.

Review

The 'Packaging Producer Responsibility System' was under review, with first stage consultations having completed in July 2019 and was to be replaced by an Extended Producer Responsibility system - originally planned for final consultation in 2021 for implementation from 2021 to 2025 - as captured in the most recent DEFRA Waste Management Plan for England.

However, following publication of the EPR consultation in March 2021, it was indicated that the PRN/PERN system would be retained as an 'interim solution' until a wider EPR could be implemented.

In March 2022 a further consultation was launched to modify the PRN/PERN system to align with the published consultation output in March 2022 on the review of the EPR system. This anticipates extending the PRN/PERN to 2026 to 2027 with some changes designed to improve the way it runs.

Obligated Companies

Businesses that handle packaging are called “producers” and are “obligated” under the regulations if:

• they handle over 50 tonnes of packaging material annually

• their turnover exceeds £2 million.

Those involved include importers, brand owners, packaging material manufacturers, packers/fillers as well as distributors and retailers, regardless of whether the material supplied is for household or business consumption.

Smaller producers below either of these thresholds do not have any obligations under the regulations. Small and medium-sized enterprises (SMEs) with a turnover of £2 million–£5 million currently have a 30-t recycling allocation threshold. This means that the targets on larger obligated businesses are slightly higher in order for the UK as a whole to meet its requirements under EU rules.

How the PRN System operates

Obligated producers can either join a compliance scheme or register themselves in the National Packaging Waste Database (NPWD).

A compliance scheme registers businesses with the appropriate environmental regulator, obtains evidence of your compliance and submits the certificate of compliance (CoC) each year. Businesses that register themselves are responsible for registering, getting evidence of compliance and submitting the CoC.

PRNs are certificates that show a company has met its obligations to fund the recycling and recovery of packaging waste as required by the UK regulations. The system works as follows.

• Packaging is created and sold to customer or consumer.
• Packaging Waste is collected, recovered and/or recycled by an accredited reprocessor.
• PRN is generated as evidence of compliance.
• Compliance company buys PRNs to meet their members’ obligations.
• Packaging data and PRNs are submitted to the Environment Agency, demonstrating compliance with packaging waste regulations.

Businesses do not need to recycle their own packaging. Purchasing PRN certificates from accredited reprocessors demonstrates that an equivalent amount of Packaging Waste has been recovered and recycled on their behalf, to meet their obligation.