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Deposit Return System (DRS) - November 15 is the deadline for compulsory registration!

Hungarian Companies have barely recovered from the first ordeal of Extended Producer Responsibility (EPR) obligations, and now they are confronted with the next challenge affecting waste management, the new mandatory Deposit Return System (DRS). Although the DRS is expected to impact fewer operators, it could pose a much greater challenge than the EPR. The official launch of the mandatory deposit return system is on January 1, 2024, with the obligation for distributors of affected products to register by November 15, 2023.

Beyond the first EPR declaration

The extended producer responsibility - EPR presented an unprecedented challenge for a wide range of hungarian companies, from multinationals to small-scale producers. Although the submission of the first EPR reports began on October 20, a significant portion of those obligated failed to fully complete the task. They are expected to catch up in the last quarter and fulfill their EPR obligations.

But before we take stock of the success of the EPR rules, we are already facing the next new challenge in waste management, the mandatory Deposit Return System (DRS),which is not only an obligation for operators but also for consumers.

What is the DRS - Deposit Return System?

Similar to other waste management regulations, the basis of the legislation can be found in EU directives, and at the national level, in the Waste Act, as well as in Government Decree 450/2023. (X.4.),which details the system.

Some detailed rules will be effective from November 1, but the mandatory deposit-charged products return system (DRS) starts in Hungary from January 1, 2024.

The abbreviation DRS, like EPR, comes from the system's English name. It is just as important for operators to deal with the DRS system as it is with the EPR system, but it is safe to say that the DRS affects significantly fewer operators, yet it may pose a much greater challenge compared to EPR.

As we are starting to get used to in the field of waste management, the operation of the mandatory deposit return system will also be carried out by MOHU.

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What products does the mandatory DRS apply to?

According to the regulation, the products included in the mandatory deposit return system will be:

  • Consumer packaging drink products made of plastic, metal, or glass,
  • In the form of bottles or cans,
  • And ranging in volume from 1 deciliter to 3 liters.

However, in addition to the main parameters, there are a few other considerations and factors worth being aware of regarding the products sorted into the DRS system.

There are two significant exceptions within the affected product range for the DRS

The first exception is for those above packaging that contains milk and milk-based drink products.

The other exception is linked to a quantity threshold. Namely, the distribution of a maximum of 5,000 units of the above packaging within one fiscal year does not establish the DRS obligation; only if this number is exceeded does a product become obligated by the DRS.

Furthermore, the regulation does not apply to specially shaped and sized bottles that are not returnable via a machine.

There is a category for mandatory or voluntary deposit returns

Besides the mandatory deposit-charged product category, the regulation also recognizes the possibility of distributing products with a voluntary deposit charge! Based on this, a manufacturer can choose to apply the system to its packaging – which otherwise would not be mandatory for a deposit return – provided that certain conditions are met.

Single-use and reusable products are both subject to the DRS

It is important that the regulation applies equally to single-use (e.g., metal cans) and reusable (glass) drink packaging within the aforementioned product categories! However, there is a difference in that the deposit fee for single-use products is 50 HUF, while the manufacturer sets the fee for reusable ones.

The DRS charge is already included in the purchase price

To simplify the above rules, any drink product whose packaging meets the outlined parameters – and almost all drink products do – will have the deposit charge included at the time of purchase, the amount of which is essentially unaffected by its material and size. The consumer purchases the product at an increased value including the DRS fee.

The mandatory return must be indicated on the product

According to the system, it must be apparent from the external appearance of the product that it is a product affected by the mandatory deposit return system. The placement of the designated marking for this purpose will be mandatory on such products.

How will the mandatory deposit return system work in practice? Who needs to operate a return machine?

If the consumer returns the product packaging, they will receive back the charged fee through an automated system. Part of the concessionary transformation of waste management also includes the incorporation of return machines into the system, and through

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