The issue of free riding is one of growing concern in light of distance sales already representing up to 20 and 30 per cent of the market across various waste streams in certain Member States. In a bid to solve this problem, the three organizations propose online sellers and fulfilment houses to be required to take on the duties of a ‘producer’ under the Directive dealing with the product they sell or stock.
Free-riding describes the process whereby companies placing products on the market circumvent Extended Producer Responsibility (EPR) obligations, including registering with EPR schemes and financing their products’ end-of-life management. By avoiding to pay for their collection and reprocessing costs, these sales distort the market: they impose an unfair cost on compliant producers, thus rendering these – mostly local companies – less competitive. In addition, they alter the collection rates: unregistered distance sales artificially lower the product-placed-on-the-market figures, thereby making the legal targets easier to reach.
In a bid to face this challenge, online sellers and fulfilment houses should furthermore be required to meet the full array of Extended Producer Responsibility obligations under both EU and national laws, from registration to cost-coverage and reporting.
For the purposes of monitoring and verifying compliance, Member States should moreover be allowed to lay down additional provisions for online sellers that tackle the specificities of their operations. Dedicated enforcement mechanisms should also be contemplated, including improved coordination between customs, tax, trading standards officials and environmental authorities responsible for product law.
The three organizations strongly believe that the EU waste proposals represent a unique opportunity to enhance the transparency and data accuracy in waste management practice across the EU. This is why online sales should be explicitly covered under the new EU waste legislation.