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Introduction

We launched a public consultation asking our customers for their views on proposed amendments we need to make to our enforcement and sanctions policy to apply Environment Act 2021 civil sanctions.

We proposed to:

• add a new annex (Annex 4) to explain our approach to using these new civil sanction powers, particularly in relation to the Producer Responsibility Obligations (Packaging and Packaging Waste) Regulations 2024 (the regulations)
• make minor amendments to our main enforcement and sanctions policy to enable the new Annex 4 to fit within it

We advised we would outline the new powers available and our proposed approach to using these powers including:

• how we鈥檒l determine the most appropriate enforcement response where the breach is also a criminal offence
• how we will calculate Environment Act 2021 variable monetary penalties
• when we鈥檒l accept or reject Environment Act 2021 enforcement undertakings

We also advised we would outline the appeal process.

This document provides an overview of how we ran the consultation and a summary of the responses we received. We identify key themes raised by consultees and set out our responses to each. We also confirm our final enforcement and sanctions policy in relation to the regulations and the overall outcome of the consultation.

The changes to our policy will take effect immediately.

How we ran the consultation

We ran the formal online public consultation for 8 weeks, between 8 January 2025 and 5 March 2025.

The consultation was hosted on 伊人直播 and our Citizen Space consultations website and was open to anybody to take part. Those not able to give their views online were able to request a copy of the consultation document and a response form to allow them to respond by email or post.

It was important for us to give our customers the opportunity to understand the proposals and the impact they will have. We encouraged our customers to give us their views through the consultation and publicised it openly.

We sent notification of the consultation directly to customers by email if we held an email address on our records.

We notified relevant trade associations directly when the consultation was launched and asked them to share the information with those whom they represent.

Summary of the key findings and actions we will take

We received a total of 68 responses to the consultation. Of these responses 64 were submitted using our Citizen Space consultation website, 3 were sent using our consultation response form to our National Customer Contact Centre and one response by letter was emailed to our contact centre. One response received was a duplicate submission.

We considered the email and letters alongside the formal responses submitted on Citizen Space.

The sector breakdown of the responses was:

• business 鈥� 21
• industry 鈥� 17
• packaging 鈥� 14
• others 鈥� 7
• waste management 鈥� 5
• environment 鈥� 2
• trade association 鈥� 1
• member of public 鈥� 1

We thoroughly reviewed all the responses, including all the comments received. We would like to thank all those who participated in the consultation and took time to provide such valuable feedback.

We considered all the information before making our final decision. The responses we received were very helpful in understanding our customers鈥� endorsement, suggestions and concerns.

We received 67 responses regarding the question on Annex 4 and whether it鈥檚 clear what Environment Act 2021 civil sanctions are available to us (Q1). Over 75% agreed or strongly agreed that our policy is clear on this point. Many comments were supportive. There were a few requests for clarity and simplified language. The following issues were raised:

• new obligations and support
• when will fixed monetary penalties (FMPs) become variable monetary penalties (VMPs)
• when will civil sanctions become criminal breaches and criminal offences

We received 67 responses regarding the question on Annex 4 and whether it is clear how we will use the Environment Act 2021 civil sanctions available to us (Q2). Over 65% agreed or strongly agreed that our policy is clear on this point. Many comments were supportive. There were a few requests for further clarity, in particular:

• how long we will allow for payment of VMPs and FMPs
• whether compliance notices are to be issued before or alongside monetary penalties
• we should extend our enforcement powers to impose additional penalties and widen our ability to pursue enforcement costs recovery notices (ECRNs)
• what happens to the funds from VMPs and FMPs

We received 67 responses regarding the question on Annex 4 and whether our method for calculating Environment Act 2021 VMPs is clear (Q3). Most respondents agreed that our policy is clear on this point. Many comments were supportive. There were a few requests for further clarity.

We received 66 responses regarding the question on Annex 4 and whether our method for calculating Environment Act 2021 VMPs is reasonable (Q4). The majority neither agreed nor disagreed that our policy is clear on this point. Many comments were supportive. One respondent asked which regulations are being considered when assessing the history of non-compliance of an organisation and will the compliance history of a director of a non-compliant organisation be taken into account in relation to a breach by the organisation.

We received 68 responses regarding the question on Annex 4 and whether our approach to calculating Environment Act 2021 VMPs will enable us to issue fair and proportionate VMPs (Q5). The majority agreed that our policy is clear on this point. However, there were some requests for further information and detail.

Many responses and issues raised in relation to questions 3, 4 and 5 were repeated or similar across all 3 questions.

Summary of issues raised across questions 3, 4 and 5:

• more detail is required to understand what is meant by 鈥渉arm鈥� at step 1 of our approach to calculating VMPs

• we should calculate a VMP based the size of a producer鈥檚 obligations under the extended producer responsibility for packaging (pEPR) regulations, in particular the non-compliant producer鈥檚 disposal fee liability

• turnover of the organisation or individual should not be a factor when calculating a VMP at step 2
• more detail is required to understand our approach to calculating VMPs in relation to very large organisations at step 2

We received 67 responses regarding the question on Annex 4 and whether our approach is clear when considering and accepting or rejecting an Environment Act 2021 enforcement undertaking (Q6). The majority agreed that our policy is clear on this point. Many comments were supportive.

We received 67 responses regarding the question on Annex 4 and whether our approach when considering and accepting or rejecting an Environment Act 2021 enforcement undertaking will enable us to do so in a fair and proportionate manner (Q7). The majority agreed that our policy is clear on this point. Many comments were supportive.

Many responses and issues raised in relation to questions 6 and 7 were repeated or similar across both questions. Also, some responses to these questions were repeated or were similar to issues raised in questions 3 and 5.

Summary of issues raised across question 6 and 7:

• we should not be able to accept enforcement undertakings where a producer avoids its disposal fee liability
• we should restrict the circumstances in which an enforcement undertaking can benefit the producer or the waste industry
• concern that we will not have the appropriate governance structures and processes in place to make consistent and fair enforcement decisions in relation to pEPR
• enforcement undertakings and criminal prosecution

Responses to consultation questions

Q1. Is it clear in Annex 4 of the enforcement and sanctions policy, what Environment Act 2021 civil sanctions are available to us?

• strongly agree 鈥� 6
• agree 鈥� 46
• neither agree nor disagree 鈥� 9
• disagree 鈥� 6
• strongly disagree 鈥� 0
• prefer not to answer 鈥� 0
• not answered 鈥� 1

Summary of responses

We received 67 responses to this question with the majority agreeing it is clear in Annex 4 what Environment Act 2021 civil sanctions are available to us. Most comments were supportive, but there were a few requests for clarity on certain points.

New obligations and support

The sanctions are clear although it would be hoped that mitigating circumstances to be considered may be the extremely complicated rules and the confused way in which extended producer responsibility (EPR) has been communicated to producers who struggle to understand what they must do.

I agree that the enforcement sanctions and policy are clear, and appear to be fair and reasonable while tackling some significant issues, there is however the issue that when considering using them for failure to comply correctly with the packaging EPR regulations, there needs to be consideration of how complex, unclear and how many times the Packaging EPR guidance, rules and application has changed since launch 鈥� In our view the EPR scheme isn鈥檛 fit for purpose and therefore it鈥檚 unfair to apply these sanctions to EPR at this time.

Our response

Three other respondents made the same or a similar point in response to this question, and a further 6 in response to other questions. Our first response is usually to give advice and guidance or issue a warning to bring a person into compliance where possible.

There is a substantial amount of guidance, information and assistance available in relation to pEPR compliance, particularly for producers and compliance schemes:

• 鈥� this document is key to ensuring as far as possible, that the 4 UK regulators approach pEPR compliance consistently, particularly in relation to producer obligations
• 伊人直播
• Environment Agency helpdesk: packagingprodoucers@environment-agency.gov.uk
• Defra helpdesk: telephone: 0300 060 0002 EPRCustomerService@defra.gov.uk for report packaging data (RPD) related queries
• Defra Business Readiness Forums, which we attend and usually present at
• Defra Circular Economy Newsletter

When will FMPs become VMPs, and civil sanctions become criminal?

A simplified version is needed. It isn鈥檛 clear at what point fixed penalties could become variable and civil sanctions become criminal

Our understanding is the decisions on moving from fixed to variable is at the EA鈥檚 discretion, but it would be reassuring to see a table of tariffs which will avoid the EA not moving to the higher levels of punishments on subjective grounds.

Our response

The table in Schedule 13 of the regulations sets out which civil sanctions we can apply in relation to each breach listed in the first column. None of the breaches in the table allow us a choice as to whether to impose either an FMP or a VMP in relation to a specific breach. In each case we only have the power to impose just an FMP or just a VMP in relation to each breach (alongside compliance notices and acceptance of enforcement undertakings, as applicable).

Our usual approach will be to seek to make use of the powers we have to apply civil sanctions, to reflect the intention of the legislation in providing civil sanction powers. We will reserve criminal prosecution for conduct which has particularly reprehensible elements, such as fraud, bad faith, misleading statements or conduct.

Breaches and criminal offences

One respondent made the following statement:

on the distinction between 鈥渂reaches鈥� and 鈥渃riminal offences鈥�: The reference to breaches that are 鈥渘ot always criminal offences鈥� could be confusing for some readers.

Our response

When we refer to a breach, we mean a contravention of an obligation in the regulations. Not all breaches of the regulations allow us to bring a criminal prosecution or apply a civil sanction. Part 10 and Schedule 13 of the regulations set out our enforcement powers. Chapter 2 of Part 10 sets out the breaches that are criminal offences, where we have the power to bring a criminal prosecution. Chapters 1 and 3 of Part 10, and the table in Schedule 13, set out our powers to apply civil sanctions in relation to the breaches of a requirement or prohibition referred to in column one of the table. We have the power to either prosecute the criminal offence or apply a civil sanction in most cases, but not all.

Where we apply civil sanctions under the regulations, we must be satisfied that a breach has occurred 鈥渙n the balance of probabilities鈥� (the 鈥渟tandard of proof鈥� in civil cases) 鈥� this means it is more likely than not to have occurred (see regulation 121(1) of the regulations). This is different to the approach to RES Act civil sanctions where the criminal standard of proof of 鈥渂eyond reasonable doubt鈥� applies. pEPR civil sanctions are not Regulatory Enforcement and Sanctions (RES) Act civil sanctions; pEPR civil sanctions derive from the Environment Act 2021. The criminal standard of proof applies where we bring prosecutions under Chapter 2 of Part 10 of the regulations.

Q2. Is it clear in Annex 4 of the enforcement and sanctions policy, how we will use the Environment Act 2021 civil sanctions that are available to us?

• strongly agree 鈥� 6
• agree 鈥� 38
• neither agree nor disagree 鈥� 11
• disagree 鈥� 10
• strongly disagree 鈥� 2
• prefer not to answer 鈥� 0
• not answered 鈥� 1

Summary of responses

We received 67 responses to this question with the majority agreeing it is clear in Annex 4 how we will use the Environment Act 2021 civil sanctions available to us. However, several respondents wanted clarity on a variety of matters, some of which are addressed below.

What happens to the funds from FMPs and VMPs?

The intended outcomes are clear (compliance, deterrence, punishment) but it is not clear where the money from the fines will go 鈥� would these fund EA activities or be used to improve the environment?

FMPs should not be used as a means to plug a gap in Agency鈥檚 limited financial resources.

Our response

There were 2 further responses (in response to this question and Q5) that made the same point or asked the same question. We will not retain any of the funds we receive from the FMPs or VMPs that we impose under the regulations. When we receive any monetary penalty, we will pay it into the Consolidated Fund (the government鈥檚 general bank account at the Bank of England) as required by regulation 124(1) and (2)(a)(i).

The Environment Agency should extend its enforcement powers

In relation to offences where only fixed monetary penalties can apply, there appears to be no provision for regulators to apply additional enforcement measures, which may be useful in exceptional circumstances. For example, there appears to be no additional powers for regulators to increase fixed monetary penalties payable in the case of repeat or highly consequential offences, nor recover their enforcement costs via fixed monetary penalties.

We also wish to see a clear statements of additional penalties for repeat offences and / or where the EA is prevented from accessing records and powers to recover enforcement costs.

Our response

The full extent of our enforcement powers under pEPR are set out in Part 10 and Schedule 13 of the regulations.

We do not have the power to impose an FMP of an amount that is different to 拢1,000; this is fixed in the regulations (see paragraph 2(1) at Part 2 of Schedule 13).

If an FMP is not paid and no appeal is made within the period of 56 days beginning with the day of receipt of the final notice, the FMP is increased by 50% to 拢1,500.

If payment is not made within 28 days in the case of an unsuccessful appeal beginning with the date of the determination of the appeal, the amount of the penalty is also increased by 50% (see paragraph 8 of Schedule 13 of the regulations).

We do not have the power to serve an enforcement cost recovery notice in relation to FMPs or enforcement undertakings (see regulation 123(1) of the regulations).

We will check if the person in breach has a history of non-颅compliance or offending, including the:

• degree, number and nature of the breaches or offences
• time elapsed since the previous breach or offence

We will normally escalate our enforcement response if previous sanctions have failed to achieve the desired outcome.

Under pEPR we can impose more than one FMP for the same act or omission (the same breach) where it is a continuing breach (see paragraph 2(2) of Schedule 13 of the regulations). This also applies to VMPs (see paragraph 10(1) of Schedule 13 of the regulations). We do not have power to prosecute a person for failure to comply with an FMP or VMP, but we do in relation to compliance notices and enforcement undertakings (see regulation 118(5) of the regulations).

If our enforcement powers were extended in the way suggested, the regulations would need to be amended by Parliament.

How long will the Environment Agency extend time for payment of a VMP?

On page 2, in relation to when a variable monetary penalty becomes payable it is stated 鈥渋f we consider it appropriate to do so, we may extend the time for payment鈥�. It is not clear how much further this deadline can be extended by. [We suggest that] the Annex either state how long the deadline can be extended by in firm terms or provide a useful indicative guideline.

Mention is made of extending the time for payment. It would be clearer if a timeframe were given.

Regarding civil sanctions and extending the time for payment if considered appropriate, for clarity please state in the Annex how long the deadline can be extended by or provide indicative guidance.

Our response

We cannot specify how long we would extend the time for payment of an FMP or VMP as this would remove our ability to be flexible in any given set of circumstances. When deciding whether to extend the deadline or not, we will take a case-by-case approach. All requests for further time for payment must be supported by evidence.

Will compliance notices be issued before or alongside monetary penalties?

In Section 1.3 on Compliance notices, it states that 鈥榃e may issue a compliance notice in conjunction with a variable monetary penalty or fixed monetary penalty.鈥� For clarity, please confirm in the Annex whether notices are to be issued before or alongside monetary penalties.

Our response

Two further respondents made the same point in response to this question. We may issue a compliance notice in conjunction with a VMP or FMP, depending on the circumstances of the particular case. We are unable to state when compliance notices will be issued in relation to VMPs or FMPs, as this would limit our ability to tailor our approach to the specific circumstances of each case.

Q3. Is our method for calculating Environment Act 2021 variable monetary penalties, including our approach to assessing aggravating and mitigating factors together in Step 3, clear?

• strongly agree 鈥� 3
• agree 鈥� 25
• neither agree nor disagree 鈥� 17
• disagree 鈥� 17
• strongly disagree 鈥� 4
• prefer not to answer 鈥� 1
• not answered 鈥� 1

Summary of responses

We had 67 responses to this question. The majority agreed that our method, in Annex 4, for calculating Environment Act 2021 VMPs is clear. Responses to questions 3, 4 and 5 are dealt with together in the sections that follow.

Q4. Is our method for calculating Environment Act 2021 variable monetary penalties, including our approach to assessing aggravating and mitigating factors together in Step 3, reasonable?

• strongly agree 鈥� 3
• agree 鈥� 19
• neither agree nor disagree 鈥� 24
• disagree 鈥� 15
• strongly disagree 鈥� 3
• prefer not to answer 鈥� 2
• not answered 鈥� 2

Summary of responses

We had 66 responses to this question. Most respondents neither agreed nor disagreed that our approach, in Annex 4, to calculating Environment Act 2021 VMPs is reasonable.

Which regulations are being considered when assessing the history of non-compliance, and will a director鈥檚 compliance history also be considered?

It is not clear which Regulations are being considered when assessing the history of non-compliance, specifically will offences under PWR also be taken into account?

It is not clear when assessing the history of non-compliance, if it is only the company鈥檚 history, or if the director鈥檚 history is also considered.

Our response

We will always have regard to the compliance history of the person that breached the obligation, such as repeated breaches of a similar type or demonstration of overall management failure.

This includes taking into account any:

• compliance history that the person may have in relation to compliance with the Producer Responsibility Obligations (Packaging Waste) Regulations 2007
• other relevant compliance history, such as a reprocessor鈥檚 compliance with waste management controls

In addition to enforcing against an organisation, we have additional powers to enforce against individuals that are either a director, partner, manager etc of the organisation in question, if the breach is due to the act or default of the individual. Also, where a breach by a person is due to the act or default by any other person, we have additional powers to enforce against that other person (see regulation 120 in respect of criminal offences and regulation 121(2) and (3) in respect of civil sanctions).

Responses to the issues raised across questions 3, 4 and 5 are dealt with together in the following sections.

Q5. Do you think our approach to calculating Environment Act 2021 variable monetary penalties, will enable us to issue proportionate and fair variable monetary penalties?

• strongly agree 鈥� 3
• agree 鈥� 21
• neither agree nor disagree 鈥� 19
• disagree 鈥� 20
• strongly disagree 鈥� 5
• prefer not to answer 鈥� 0
• not answered 鈥� 0

Summary of responses

We had 68 responses to this question. Most respondents agreed that our approach in Annex 4, to calculating Environment Act 2021 VMPs will enable us to issue proportionate and fair VMPs. However, this question drew nearly an equal number of responses from those who neither agreed nor disagreed or who disagreed. Responses to the issues raised across question 3, 4 and 5 are dealt with together in the following sections.

Q3, 4 and 5 鈥� summary of issues raised

Harm to the integrity of the pEPR regime and the size of a producer鈥檚 obligations under the regulations, in particular the disposal fee liability: step 1

Several respondents to these questions asked for more detail relating to the categories of harm at step one in our approach to calculating VMPs. Also, in the context of producers鈥� obligations, they said that the categories of harm should be based on the size of the producer鈥檚 packaging obligations under pEPR, in particular a liable producer鈥檚 disposal fee liability or potential liability.

Extracts from these responses:

[We believe] that for offences committed in relation to the Packaging Waste Regulations, the size of a producer鈥檚 obligation, tailored to the corresponding offence, be the basis upon which a system of scaled variable monetary penalty guidelines are developed, for penalties applicable to be most appropriate, fair and proportionate.

We believe that allowing producers to effectively bypass their EPR obligation undermines the integrity and effectiveness of the scheme and risks the system haemorrhaging funds.

Allowing producers to evade obligations to provide funding to PackUK means that the system will be underfunded, undermining the integrity and proper functioning of the scheme. Non-compliant producers should be required to pay their disposal fee obligations and additionally face penalties.

In relation to Step 1 where regulators must consider the level of harm caused by an offence to determine the category of the breach concerned, [we] suggest the descriptions of the harm levels be enhanced to be include wording that enables them to be more applicable to breaches under the pEPR Regulations. We support that 鈥榟arm鈥� can be interpreted as the level of harm inflicted on the integrity of the regulatory regime concerned but believe the sentencing guidelines should be developed further to describe the harm caused by producers鈥� non-compliance, for example with disposal fee payment or packaging data reporting obligations on the wider producer responsibility system.

Further guidance and qualification needed for the level of harm to make them relevant to breaches under the pEPR Regulations.

Further clarity would be required however on how the categories of harm will be structured where the harm is to the integrity of the regulatory regime. There is not a straightforward read across between the harm to the environment in the current guidelines and the harm to the regulatory regime.

The relationship between our enforcement powers and liable producers鈥� disposal fee liabilities聽

Our response

In relation to the breach of producer and compliance scheme obligations under pEPR, we can impose a VMP in response to a breach:

• of a large producer鈥檚 recycling obligation
• of a range of other obligations that either underpin compliance with the recycling obligation or the obligation to pay disposal fees, or both,聽such as producer registration, reporting of packaging data or reporting of recyclability assessments as appropriate

We have no enforcement powers in relation to the requirement on producers to pay disposal and administration fees. This is a matter for the pEPR scheme administrator. Our enforcement powers relate to the underlying obligations that support the disposal and administration fee obligation, such as the requirement to register or report packaging data.

The pEPR scheme administrator has the power to apply civil sanctions where a liable producer breaches its obligation to pay a disposal fee invoice 50 days after the due date. Where a liable producer avoids its disposal fee liability by failing to register and, or report packaging data for example, the scheme administrator may subsequently issue a disposal fee invoice to that producer.

Only the scheme administrator is required to apply the formulas at paragraphs 10(3) and (4) of Schedule 13 of the regulations (as appropriate) when calculating a VMP in response to a liable producer鈥檚 failure to comply with its obligation to pay its disposal fee invoice. These formulas do not apply to us when we calculate VMPs. The VMPs that the EA can impose are those listed in column one of the table in Schedule 13 of the regulations. This is as indicated in column 3, as read with regulation 114(a)(ii), which excludes the breach of non-payment of disposal and administration fees from our enforcement powers (regulation 114(b)).

For example, a liable producer fails to report its household packaging in breach of regulation 25(1)(c)(i).聽The VMP amount we impose in response will not include or extinguish the producer鈥檚 avoided or potentially avoided disposal and administration fee liability, as a consequence of failing to report its household packaging.聽The producer remains liable for any outstanding disposal fees or potential disposal fee liability connected with the breach, which is a matter for the scheme administrator.聽The VMP we impose is an enforcement response to the liable producer鈥檚 breach of its obligation to report household packaging.

In the same way, FMPs and compliance notices that we impose and enforcement undertakings that we accept, will not include a liable producer鈥檚 disposal fee obligations.

If we impose an FMP on a liable producer for breach of an underlying disposal fee obligation, such as failure to keep household packaging records, payment of the FMP will not have any impact on that producer鈥檚 disposal fee liability under the regulations.

An enforcement undertaking accepted by us will not include any action to secure that contravention of a liable producer鈥檚 obligation to pay disposal and administration fees does not continue or recur. Neither will it include any action to restore the position to what it would have been if the liable producer had met its disposal and administration fee liabilities. The responses to questions 6 and 7 give further details.聽The same position applies in relation to compliance notices imposed by us 鈥� they will not include steps that relate to or require a liable producer to pay disposal and administration fees.

Additionally, it would not be possible for us to calculate or estimate a liable producer鈥檚 disposal fee liability when we impose a VMP; it is the scheme administrator alone that has the function and ability to do so.

Where we impose a VMP on a producer or compliance scheme for breaching its recycling obligation, we will take into account any identifiable financial gain and avoided costs as a result of the breach when we assess aggravating and mitigating factors at step 3 of our approach.

However, when we calculate a VMP we will take into account the harm to both the recycling obligation and the disposal fee systems embedded within the pEPR regime when a producer breaches an obligation that supports either system, such as producer registration or failure to report packaging data.

How we will take into account harm when we calculate a VMP

Our response

We have provided more detail in Annex 4 to explain how we will categorise 鈥渉arm鈥� when we determine the breach category at step 1.

In our draft Annex 4 document that accompanied the consultation document, in relation to our approach to 鈥渉arm鈥� at step 1 we said:

We will use the categories of harm in the guideline, but where appropriate we will substitute harm to the integrity of the regulatory regime rather than to the environment.

In relation to pEPR, due to the nature of the regime, it is appropriate to rely on harm to the integrity of the pEPR regime when applying the categories of harm in the guideline: 鈥渋nterference with, prevention or undermining of other lawful activities or regulatory regime due to offence鈥� and that is the approach that we will take. There are 2 overriding objectives of the pEPR regulatory regime, the trust in, transparency, reliability and effectiveness of:

• the recycling obligation and packaging waste recycling note (PRN) and packaging waste export recycling note (PERN) evidence system
• the disposal fee and costs system

Most obligations in the regulations relate to one or both of these systems. For example, producer registration and reporting of household packaging data relates to both. Some obligations relate to only one of them, for example, an accredited reprocessor鈥檚 requirement to issue PRNs in accordance with its accreditation conditions relates only to the recycling obligation and PRN system and a liable producer鈥檚 obligation to report its recyclability assessment relates only to the disposal fee and costs system. Some obligations have no relationship with either system, for example producers鈥� obligation to report data on plastic or paper bags supplied in England and small producer obligations. We will categorise harm to the integrity of the pEPR regime based on whether the obligation that has been breached impacts either system.

We will normally apply the categories of harm in the guideline as follows, a breach which impacts:

• both systems will be assessed as category 1 harm to the integrity of the pEPR regime
• one of the systems will be assessed as category 2 harm to the integrity of the pEPR regime
• neither system will be assessed as category 3 harm to the integrity of the pEPR regime

There are a small number of breaches where the impact of the breach on either system is not clear cut. In those cases, we will determine the harm category of the breach on a case-by-case basis by assessing whether the breach impacts either system on the facts of the specific case.

We will also reserve the flexibility to regard a breach which impacts:

• both systems as category 2 harm, if the facts of a particular case do not justify the approach of applying category 1 harm
• one system as category 3 harm, if the facts of a particular case do not justify the approach of applying category 2 harm

Because category 4 harm relates only to 鈥渞isk of category 3 harm鈥� in the guideline, we will not utilise category 4 when determining the category of harm to the integrity of the pEPR regime.

Turnover of the organisation or individual: step 2

Several respondents to questions 3, 4 and 5 said that they did not want us to take into account an organisation鈥檚 or individual鈥檚 turnover at step 2 of the approach:

The reason for disagreeing is covered in the answers to Q.4 and Q.5 where we suggest by ensuring the same level percentage wise of impact is the same for all offenders irrespective of business size then the fines will be proportionate. Fairness can only be assessed by understand the degree of seriousness for the offenses named. Is it the belief they are all equal in terms of offense? We feel they aren鈥檛 and the most serious not registering, not submitting data and submitting under-estimated data are the most serious offenses.

Overall, [our] position is that if a smaller organisation is found to be grossly non-compliant, then it should receive the same level of fine as a larger organisation that has committed the same severity of offence.

It is not appropriate to use producer turnover as the basis upon which to institute a system of scaled variable monetary penalties in relation to offences committed under the Packaging Waste Regulations, on two grounds. Firstly, as turnover data isn鈥檛 reported in pEPR data submissions, meaning further investigation is required to determine an offender鈥檚 turnover which is then to be used to determine which scale of variable monetary penalty guidelines to use. Secondly, turnover may not provide a strong enough correlation to the size of a producer鈥檚 financial obligations and therefore their impact on the proper functioning and integrity of the Packaging Waste Regulations.

For many of the offences named the total turnover of a business may not relate in any way to the tonnage of packaging they place on the market. For some higher turnover businesses packaging may account for a small part of their turnover. For some offences the size of what should have been a business鈥檚 EPR bill is more appropriate.

Our response

We will follow the guideline and assess the size of the organisation by turnover or equivalent to take the financial circumstances of the organisation into account. If the non-compliant person is an individual, we will assess turnover or income, whichever is appropriate. See our earlier response in relation to the concern that VMPs should be based on a producer鈥檚 tonnage of packaging or the value of their avoided recycling obligation or disposal fee liability.

Where the producer is a registered company, we can obtain turnover information that is publicly available from Companies House, as well as other sources.

Our approach to very large organisations (VLOs) at step 2

The draft annex appears to be somewhat contradictory, in that whilst it is clearly stated that regulators can apply variable monetary penalties of an unlimited amount, it is also stated that a 拢1 million fine, increasing to 拢3 million where necessary, for the most serious, deliberate offence is the recommended 鈥渢op鈥� of the tariff scale for non-compliant parties of a 鈥楲arge鈥� size.

Also the sentencing guidelines outline that on occasions it may be necessary for regulators to apply a variable monetary penalty that goes beyond the codified scale, especially in the case of an organisation with a turnover that defines the organisation as 鈥榲ery large鈥�. We suggest guidelines for the penalty recommendations for very large organisations be codified, given there is likely a considerable number of obligated businesses whose turnover is considerably greater than 拢50 million in 2025.

Our response

There is nothing contained within the guideline on this point, and we do not believe that it is helpful for us to create guidance specifically for VLOs. We have explained our approach to VLOs as far as we can in our final Annex 4.

Q6. Is our approach to considering and accepting or rejecting an Environment Act 2021 enforcement undertaking clear?

• strongly agree 鈥� 2
• agree 鈥� 35
• neither agree nor disagree 鈥� 16
• disagree 鈥� 6
• strongly disagree 鈥� 6
• prefer not to answer 鈥� 2
• not answered 鈥� 1

Summary of responses

We had 67 responses to this question. Most respondents agreed that our approach in Annex 4 is clear regarding how we will consider and accept or reject an Environment Act 2021 enforcement undertaking.

Responses to the issues raised across questions 6 and 7 are dealt with together in the following section.

Q7. Do you think our approach enables us to consider whether to accept or reject an Environment Act 2021 enforcement undertaking in a fair and proportionate manner?

• strongly agree 鈥� 2
• agree 鈥� 34
• neither agree nor disagree 鈥� 21
• disagree 鈥� 4
• strongly disagree 鈥� 5
• prefer not to answer 鈥� 1
• not answered 鈥� 1

Summary of responses

We had 67 responses to this question. Most respondents agreed that our approach in Annex 4 will enable us to consider and accept or reject an Environment Act 2021 enforcement undertaking in a fair and proportionate manner.

Responses to the issues raised across questions 6 and 7 are dealt with together in the following section.

Q6 and 7 鈥� summary of issues raised

A few respondents made this statement:

It鈥檚 clear when an enforcement undertaking would likely be accepted or not, as opposed to a prosecution.

Our response

This statement is misleading because an enforcement undertaking will not necessarily be an alternative to prosecution under pEPR. Under pEPR, we have already stated in draft Annex 4 that:

Our usual approach will be to seek to make use of the powers we have to apply civil sanctions, to reflect the intention of the legislation in providing civil sanction powers. We will reserve criminal prosecution for conduct which has particularly reprehensible elements, such as fraud, bad faith, misleading statements or conduct.

When will we accept an enforcement undertaking as opposed to imposing a VMP?

One respondent made the following comment:

The EA could set out how it would use the culpability (blame) and harm factors guidance more clearly to determine what would be an appropriate level of offer, and when the harm level dictates that the offer would be rejected.

Our response

When we assess offers of enforcement undertakings, amongst other things, we will compare the amount of money or the value of the benefit or improvement offered, to the amount that we would calculate if we were to impose a VMP (where applicable) using our stepped approach for pEPR explained earlier. We would expect the amount of money or value of the benefit or improvement offered to be broadly equivalent to the amount of a VMP.

In relation to enforcement undertaking offers made in relation to offences under the Producer Responsibility Obligations (Packaging Waste) Regulations 2007, we generally expect offers of enforcement undertakings to be increased by:

• 10% of avoided costs and, or financial gain where the offer made has been proactive
• 30% of avoided costs and, or financial gain where the offer made has been reactive

Under pEPR we will not apply this approach, but we will still consider whether the offer is proactive or reactive at step 3 (aggravating and mitigating circumstances) of our approach.

We have amended the list of circumstances in which we will not normally accept an enforcement undertaking offer. We may consider enforcement undertaking offers irrespective of the category of harm we consider to have been caused. Also, we may consider enforcement undertaking offers after we have served a Notice of Intent to impose a VMP.

Enforcement undertakings and disposal fees

Several respondents made this and similar statements:

It is not appropriate to allow producers that are non-compliant with an obligation to pay pEPR disposal fees or to undertake recyclability assessments to make offers of enforcement undertakings鈥� Allowing producers to evade obligations to provide funding to PackUK means that the system will be underfunded, undermining the integrity and proper functioning of the scheme. In our view, non-compliant producers should be required to pay meet their disposal fee obligations and additionally face penalties. To this end, we are supportive of the 20% disposal fee liability or turnover-based penalty installed within the pEPR Regulations, however it is not clear whether non-compliant producers can evade paying this penalty and instead opt to make an offer 鈥� potentially of lower value - of an enforcement undertaking to a cause unrelated to PackUK鈥檚 endeavours.

Our response

We have the power to accept an enforcement undertaking where the table in Schedule 13 of the regulations indicates that we can.

Please refer to section Q3, 4 and 5 鈥� summary of issues raised, which explains the relationship between the civil sanctions we can apply and a liable producer鈥檚 disposal fee liability. We will not accept an enforcement undertaking that purports to take into account an avoided or potentially avoided disposal fee liability. A liable producer鈥檚 liability for disposal fees is a separate matter for the scheme administrator. The formulas in the regulations at paragraph 10(3) and (4) of Schedule 13 that apply to the calculation of VMPs do not apply to us. They only apply to the scheme administrator where it imposes a VMP in response to non-payment of a disposal fee invoice 50 days after the due date.

We should restrict the circumstances in which an enforcement undertaking can benefit those operating in the private sector

We do not consider that the funds should be used for the recovery and recycling of packaging waste. This opens up numerous opportunities for the wrong behaviour and whilst it must not have financial benefit to the offeror, could it benefit a different company in their group, or even the compliance scheme that has prepared the offer for their member on a consultancy basis? We consider that accepting any offers based on recycling and reuse of packaging to be potentially unfair to other operators.

Our response

We will always consider and review any enforcement undertaking offers made to us and either accept or reject the offer based on the individual circumstances of each case. We will follow our usual approach in relation to beneficiaries of enforcement undertakings and the proposed benefit or improvement to the environment. We will assess whether the benefit or improvement offered under an enforcement undertaking meets the policy objectives of the pEPR regime. Any charity identified as a potential beneficiary of an enforcement undertaking offer, must have objectives that align with improvement to the environment, preferably related to the pEPR regime objectives 鈥渟uch as the prevention of littering, or an increase in the reuse and recycling of packaging鈥� but this is not essential (see paragraph 20(1)(c), Schedule 13 of the regulations).

Offers must be unrestricted donations and the person making the offer must not derive any benefit of any type from the donation or have a conflict of interest.

Enforcement undertakings that benefit or fund the core business activities of for example, compliance schemes, consultants or waste recycling operators will not be accepted.

Concern that we will not have the appropriate governance structures and processes in place to make consistent and fair enforcement decisions in relation to PEPR

Several respondents were concerned that we will not be consistent in our approach to calculating VMPs and accepting or rejecting enforcement undertakings under pEPR.

We will have procedural safeguards in place to ensure the person in breach understands the case against them. We will set out the alleged breach and the reasons for the proposed monetary penalty in the notice of intent, together with the VMP assessment and calculation summary or amount of the FMP, as applicable. When we serve a compliance notice, we will also set out the alleged breach and the reasons for imposing the notice.

Organisations and individuals that receive a VMP or FMP notice of intent will have 28 calendar days from which to make written representations or objections. We will carefully review these together with any evidence we hold. The person in breach can also make representations at an earlier stage.

In all cases where a VMP is recommended, the amount of the monetary penalty will be reviewed by our Enforcement Governance Group with oversight provided by the National Civil Sanctions and Penalties Panel, supported by National Technical and Legal experts. This robust governance structure will help us achieve consistency.

All VMPs and offers of enforcement undertakings will be subject to deputy director and a senior managing lawyer approval.

Miscellaneous point: sharing the responses with the other pEPR UK regulators

Several responders recommended that we share:

feedback from this consultation where appropriate, with the environmental regulators of the other UK nations where they are considering their own enforcement approaches to the regulations.

Our response

This consultation response will be shared with Natural Resources Wales, the Scottish Environment Protection Agency, the Northern Ireland Environment Agency and PackUK, the current scheme administrator, for their awareness.

Next steps

We have published our summary of the main consultation findings. We will now progress with publishing our revised enforcement and sanctions policy and associated Annex 4.

If you wish to discuss your responses, or points made within this response document in more detail you are welcome to contact us by emailing enquires@environment-agency.gov.uk with the subject 鈥楥onsultation on applying Environment Act 2021 civil sanctions鈥�.