Eco-contribution: who has to pay the EPR tax EPR
You have probably heard of eco-participation or the EPR tax, but do you sometimes feel overwhelmed by the complexity of environmental regulations?
You are not alone.
Extended Producer Responsibility (EPR), often misunderstood, is more than just a tax. If you are a finance or compliance manager and need to understand in detail what this system implies for your company, you've come to the right place.
Do you have just one minute?
- The Extended Producer Responsibility imposes a financial obligation on companies that introduce products to the French market for the first time, to participate in the management of recycling and the recovery of waste from their end-of-life products.
- This financial contribution, called eco-contribution, varies greatly depending on the products you sell, as the recyclability of the materials used in your products has an impact on the actual costs of recycling.
- Products subject to EPR currently divided into 19 sectors. Waste prevention, collection, sorting, reuse, and recycling are managed by eco-organizations approved by the government. Penalties for non-compliance can be as high as €75,000.
- EPR offers companies the opportunity to play an essential role in preserving the environment.
Eco-participation or EPR tax? Let's clarify.
The eco-participation, also known as eco-contribution, is the financial contribution made by the purchaser of a new product to finance the recycling of that product at the end of its life.
The eco-contribution, often mistakenly referred to as the " EPR tax," is not a tax because it is not paid to the government. All eco-contributions are paid to eco-organizations, which are non-profit companies approved by the government. These eco-organizations, whose role is to collect, sort, reuse, and recycle waste, do not make any profit from the eco-contributions paid by companies. The entire eco-contribution is dedicated to the missions entrusted to them by the public authorities.
Please note
- The eco-participation is included in the sale price and, as such, is subject to VAT.
- It must be passed on in full to the customer (who must be informed if it concerns electrical or electronic equipment or furniture).
- The amount of the eco-participation cannot benefit from any discount or rebate.
- It applies to all products placed on the market, including those given away free of charge.
Eco-participation: Is my company affected?
The EPR system EPR on the "polluter pays" principle. In other words, anyone who manufactures, distributes, or imports a product must contribute to its end-of-life recycling costs.
You are considered a "Producer" within the meaning of the EPR you are the first to place a product on the market in France for the domestic market, regardless of whether you are a manufacturer, distributor, reseller, retailer, importer, French or foreign company. Extended Producer Responsibility therefore requires you to contribute financially to the recycling of your products.
The government has created 25 EPR channels, 19 of which will be operational by 2024. These channels group together large product families to facilitate sorting, recycling, or reuse. State-approved eco-organizations manage specific channels. They are responsible for waste treatment and are committed to complying with specifications that include collection and recycling targets.
This obligation arises from the AGEC law of 2022, which promotes the circular economy. The latter not only encourages the reuse of resources and the reduction of waste, but also encourages eco-design in the manufacture of products.
The EPR system improves the environmental impact of companies and reduces recycling costs, thus benefiting society as a whole.
If you market products that fall under several sectors, you will need to join as many eco-organizations as necessary, which will collect the eco-contribution for the end-of-life management of the products concerned.
Take the example of a watch manufacturer: if it integrates a battery or a connected function into its product, it is responsible not only for the end of life of the watch, but also for that of the battery, any instructions and its packaging.
As a result, depending on the nature of your products, you may be subject to several EPR Schemes simultaneously for a single product.
Eco-contribution: What will my financial contribution be used for?
France is actively organizing its recycling Schemes, with 25 of them by 2025. According to ADEME, this initiative has made it possible to manage 9.4 million tonnes of waste in 2021. The objective now is to extend this organization to the European level, in order to harmonize a market of nearly 350 million consumers.
Environmental regulations are constantly changing. Anticipating these changes can be beneficial for any company.
The eco-contribution is not just a cost; it represents an opportunity to contribute to a sustainable future. As entrepreneurs, our role is essential, not only for our businesses but also for the planet.
Particularly in internal communications, clearly communicating these efforts to your teams strengthens their commitment and promotes a responsible corporate culture. This is true even if it is a regulatory requirement, which could be perceived as a trivial action by consumers and citizens. It also attracts new strategic talent, which is essential to the development of your business.
Eco-participation: How much will it cost me?
The amount of the eco-contribution is determined by a scale set each year by eco-organizations. It varies according to the cost of waste treatment. Thanks to the Anti-Waste Law for a Circular Economy (AGEC), this amount will be reduced if the product meets environmental criteria (bonus) or increased if the product is highly polluting (penalty). This is known as eco-modulation.
Eco-participation rates are regularly revised by eco-organizations. In 2024, eco-participation costs were aligned with actual recycling costs, impacting companies' finances and environmental strategies.
There are several methods for managing the costs associated with recycling and sustainable product design.
Firstly, reducing the use of materials that are difficult to recycle from the design stage can generate significant savings.
The toy giant Playmobil, a major consumer of plastic, has been using plant-based plastics and packaging made up of at least 90% recycled cardboard and 100% recycled paper since spring 2024.
Secondly, investing in clean technologies that consume less energy and resources is another effective approach.
Thirdly, transparency about your recycling efforts not only helps to comply with regulations, but also improves your reputation.
Eco-participation: How and why to comply
Environmental regulations are constantly changing. Anticipating these changes can be beneficial for any company.
These complex calculation methods require constant vigilance on the part of companies to adapt to changes and avoid penalties. Eco-organizations are required to publish their rates, which are available online on their respective websites.
To remain compliant, it is essential to comply with reporting, eco-contribution payment, and annual documentation requirements.
The risks of non-compliance can lead to severe fines of up to 75,000 euros, or even prison sentences and business shutdowns.
CompliancR a self-service digital platform that offers you all the services you need to meet your EPR obligations, from automatically calculating eco-contributions for your products to declaring them to eco-organizations, joining the relevant sectors, and creating your UINs Unique Digital Identifiers).