Business

How will the contribution fee for the compulsory collection and recycling tool be used?

By Khoi Minh December 27, 2022 | 10:45 AM GMT+7

According to Phan Tuan Hung, director of the Legal Department under the Ministry of Natural Resources and Environment, the contribution fee for the collection, recycling and treatment of hazardous waste is mandatory for the purpose of encouraging businesses to adjust their product design as well as their production and business methods toward an environmentally beneficial direction.

The 2020 Law on Environmental Protection (LEP) introduces the concept of circular economy through fostering policy, highlighting the responsibility of producers and importers to recycle products and packaging.

Following this, the government issued Article 54 and Article 55 which details requirements on collection, disposal, and recycling of waste products, plastic waste, and others.

In details, Article 54 provides that “Organizations and individuals producing and/or importing products and packages with recycling value shall implement the recycling at the obligatory rates and according to prescribed specifications."

Article 55 states that “Organizations and individuals producing and/or importing packages, containing toxic substances, which are hardly recyclable or impede the collection and treatment, shall pay financial contributions to support daily-life solid waste treatment activities.”

While lots of businesses concerned about the cost pressure, Hung affirmed that the contribution fee is to encourage businesses to not only organize their own collection and recycling, but also change the product design.

He added that the purpose of the EPR fee is not to "collect more money". The EPR policy is only really successful when manufacturers and importers no longer have to pay EPR fees.

Fausto Tazzi, vice president of Vietnam Packaging Recycling Organization (PRO Vietnam), commented that in order to achieve the expected outcome, the mandatory collection and recycling rates need to be determined appropriately and scientifically.

"If the collection and recycling targets are set too high, businesses will choose to make financial contributions to 'don't have to think too much', instead of finding ways to optimize production and business activities," said Fausto.

How to use EPR money?

To enforce the extended responsibility of producers, the EPR operates under a general mechanism, with the Producer Responsibility Organization (PRO) acting as the center of the system.

It represents the producers to organize the collection and recycling of abandoned products and packages of producers and importers, and perform other duties related to the recycling responsibility, such as registration of recycling, and reporting on recycling results, communication to raise community awareness of garbage sorting at source.

Under this mechanism, the producers may select recycling forms via PRO, or through financial payments to the Vietnam Environmental Protection Fund.

This money of the fund will be used to support the following activities, incuding collection, transportation and treatment of residential solid wastes from family households; research and development of solid waste treatment technologies, techniques and innovations; and collection, transportation and treatment of plant protection drug packages.