German Drinks Packaging Deposit Draws Legal Challenge

BRUSSELS, Belgium, October 21, 2003 (ENS) - The European Commission has opened a new chapter in the controversy over Germany's deposit and return system for one-way drinks packaging by deciding to start a legal trade infringement procedure. The EU executive believes the system may constitute a "disproportionate barrier" to imported drinks, it said today.

EU Internal Market Commissioner Frits Bolkestein tried to launch infringement proceedings against Germany in the summer but was blocked after lobbying from German Chancellor Gerhard Schroeder.

German Environment Minister Juergen Trittin won another delay at the end of September. Time has now run out, the Commission has decided.

The containers in which German soft drinks are sold are piling up in landfills across the country. (Photo credit unknown)

The deposits law took effect in January, but without a "clearing system," meaning that consumers must return containers to the point of purchase to claim back their deposit.

Industry groups say the result has been chaos - consumption of beer and soft drinks is down 10 to 14 percent and "thousands of jobs" are being lost, they claim.

Under intense lobbying from industrial opponents of the scheme - as well as counter-lobbying from the German government - the Commission now says it agrees with critics that there is "no properly functioning nationwide return system" in place.

German retailers are taking imported drinks off their shelves because of the mandatory deposit and the absence of an effective return system, the Commission says.

"If EU beverage manufacturers were effectively excluded from the German market, this would reduce choice for German consumers and could constitute a serious violation of Community law," it adds.

In a first reaction, Trittin insisted that the Commission's legal warning does not threaten the integrity of the deposits system. Germany will try to convince the EU executive that foreign companies are not being put at a disadvantage, as claimed, he said.

German Environment Minister Juergen Trittin represents the Green Party. (Photo courtesy Government of Germany)

In May, retailers' association HDE, which has fought the introduction of deposits at every step of the way, made a bid to introduce a packaging tax instead of deposits on the one-way drinks packaging. But the environment ministry quickly quashed any possibility of a tax, saying that the government had no intention of rescinding its deposits policy. A tax would be "poison to the economy" and would absolve the drinks industry of its responsibility for the proliferation of one-way drinks containers, the ministry said.

The scheme appeared to take a step forward in July when Trittin introduced the first take-back machine for one way drinks containers at an outlet of supermarket chain Netto. Netto's take-back machine accepts both refillable containers and one way PET plastic bottles subject to the new deposit system. Trittin said that Netto's installation of the machine means that retailers could continue to offer consumers the choice of one way or refillable drinks containers.

The minister said he hoped that other retailers would join a nationwide scheme being set up by kiosk supplier Lekkerland and supermarket chain Spar.

German Member of the European Parliament Hiltrud Breyer - like Trittin a Green - accused the Commission of putting industry interests ahead of environmental protection and stoutly defended the deposit system as in line with core European Union policies such as waste prevention.

However, the Commission has backing from other members of the European Parliament, three of whom held a press conference on Tuesday afternoon during the European Parliament's plenary session in Strasbourg. The Parliament was due to debate the issue of German deposits this evening.

{Published in cooperation with ENDS Environment Daily, Europe's choice for environmental news. Environmental Data Services Ltd, London. Email: envdaily@ends.co.uk}