Extended producer responsibility scheme
Newsletter – 10.05.2023
Following the Community law, the extended producer responsibility (EPR) system will apply in Hungary as from 1 July 2023 to circular products. In addition, the Waste Act imposes new obligations on the taxpayer.
Our specialists support your activities with a full range of services related to EPR obligations, in particular including:
- support with registration with MOHU MOL and with the waste management authority,
- the EPR categorization of business activities,
- the EPR classification of manufactured (distributed) products, including their components and accessories,
- EPR register, creation of circulation codes,
- classification of circular products under the EPR fee code,
- assistance with the data provision,
- advice on EPR-related invoicing rules and modification of invoicing programs,
- for foreign manufacturers and foreign online stores, function as authorized representative for EPR purposes,
- advice on assuming EPR obligations and individual performance,
- assistance in dividing the green tax and the EPR payment obligation.
The level and the administration of obligations shall be different for waste producers and producers (distributors).
Though waste producers are a smaller group of stakeholders, their obligations are broader and earlier deadline applies. The registration of the concession with the MOHU MOL must be done by 30 April 2023.
A waste producer is a company that produces waste covered by the EPR (e.g., by dismantling packaging from abroad), collects it separately and transfers it to a waste recovery organisation. The notion does not include scrap or waste generated during the production process.
The EPR obligation arises when the manufacturer places the circular product on the market. Producers of circular products include manufacturers and, if the product is not produced domestically (but comes from the EU or a third country), the first person placing it on the market in Hungary.
In connection with the EPR, producers (distributors) must register with the waste management authority and with the MOHU MOL as concession company. The deadline is 31 May 2023.
In addition to the registration, record keeping obligation and quarterly reporting to the waste management authority apply. Based thereon, the extended producer responsibility fee shall be paid to the concession company on basis of its invoices.
The EPR system will operate parallel to the green tax though both systems do not fully overlap, which also makes it difficult to establish correct EPR obligations. For example, in the case of packaging, the person liable to pay the green tax and the EPR fee will be different. At the same time, the authorities will compare the EPR data submitted to the waste management authority and the green tax data received by the tax authority and use them as a control instrument.
In addition, manufacturers (distributors) must provide for specific wording related to the EPR on their invoices, which requires a set-up of billing programs as soon as possible.
In the event of non-compliance, the waste management authority may impose fines and prohibit the placing of circular products on the market.
A circular product is considered as placed on the market and subject to EPR in the following cases:
- the first domestic free transfer or transfer for consideration,
- a use for its own purposes (e.g., use of a foreign circular product in the context of an investment or renovation under the Accounting Act, use or placing into use in the context of the provision of services, final separation of the product from its transport or protective packaging),
- sale from a foreign online shop to households or other persons in Hungary.
Circular products are defined to include:
- packaging (e.g., paper, plastic, metal, wood consumer, collection and transport packaging),
- certain single-use and other plastic products (e.g., food storage containers, beverage bottles, beverage cups, wet wipes),
- electrical and electronic equipment (e.g., heat exchange equipment, certain computing devices, lighting fixtures),
- batteries (e.g., portable batteries, accumulators, car accumulator),
- motor vehicles,
- tyres (rubber tyres, retreaded rubber tyres),
- office paper (e.g., copy paper, binder box, notebook),
- advertising paper (e.g., books, newspapers, printed matter),
- frying oil, frying fat (for example, sunflower seed, rape seed, olive oil of specified tariff headings),
- certain textile products (e.g., certain knitted or crocheted articles of clothing, blankets, carpets, footwear), and
- certain wooden furniture (e.g., convertible seating furniture, kitchen furniture, bedroom furniture, office furniture).
We are pleased to assist you with our services in meeting these obligations in a timely manner, including assistance with changes to the green tax in relation to the EPR.
Please do not hesitate to contact us!