Two of the three proposed methodologies for the calculation of a compliance fee under the WEEE regulations propose that T2E oversees the administration of compliance fees for WEEE schemes. A third recommends the use of Mazars, the UK’s eighth largest accountancy firm.
The three proposals were released by BIS on October 24 2014 and have been submitted to the department by industry. The two which suggest working with T2E are a joint submission by Dataserv, DHL, Transform, Valpak and Veolia and a separate submission by the Environment Exchange itself. A third proposal is from the producer and WEEE scheme trade body the Joint Trades Association (JTA) and would see Mazars coordinating the compliance fee work.
Each of the proposals incorporates a sliding scale which increases the fee the further from their collection targets a scheme has ended up.
Under the WEEE rules, producer compliance schemes are liable to pay the fee if they fail to meet their members’ recycling obligations through buying sufficient recycling evidence in 2014 and similarly in subsequent years. The Department for Business has asked for views on each of the proposals to be submitted by Friday November 28.
The idea of a fee is intended to discourage compliance schemes from collecting volumes of WEEE significantly above their collection targets and then seeking to sell the surplus evidence to schemes seeking evidence to meet their obligations, because schemes could then choose the alternative of paying the fee instead of buying evidence.
Details of the proposal submitted by the JTA – which represents the nine major trade associations in the electronic sector and works with three producer-led compliance schemes, ERP, Recolight and REPIC – had previously been made available when the group submitted the plans in September (see letsrecycle.com story).
The proposal is based on the average net cost of collections and treatment incurred by schemes that decide to use the fee for a collection stream and will see an escalator applied to the calculation, depending on how far the scheme is from its collection target.
Under the proposal, fees paid to the administrator of the scheme, Mazars LLP, will be distributed to local authorities for the improvement of collection and recycling for household WEEE.
The two alternative submissions both propose that the scheme should be operated by T2E, and would see the organisation run an ‘independent contract reconciliation centre’ to which schemes would pay money to balance any shortfall in evidence collected.
T2E has proposed that the fee would be worked out based on the evidence fee for each category, the percentage shortfall from a scheme’s overall obligation and the number of streams in which a shortfall occurs.
The system proposed by Dataserv, DHL, Transform, Valpak and Veolia would see schemes submit the highest, lowest and average net cost of the treatment and collection of WEEE from schemes, with the final fee derived from a sliding scale also dependent on the shortfall of WEEE collected.
This, it is claimed, will benefit schems which largely meet their targets but are short by a small tonnage and punish those that have collected very little and have made “no contribution to national collections and therefore should pay correspondingly more per tonne to compensate”.
The escalator will be calculated for each scheme and each stream separately by reference to their tonnage collected and target in that particular stream.
Following the consultation, BIS will announce its decision as to which methodology will apply from February 2015. Any schemes which fall short of their collection targets in 2014 will be liable to pay the fee in accordance with the chosen method from that date.