Canada’s economic success relies on an open, competitive marketplace. The free exchange of goods and services between businesses and individuals drives innovation, creates jobs, and sustains economic prosperity. The same is true for market-based policies designed to address environmental challenges, such as extended producer responsibility (EPR).
Creating a more competitive system
EPR is a policy approach used by governments to make companies, or producers, responsible for managing the recycling and safe disposal of certain products and materials once they have been discarded by consumers. It is most effective in an open market where both producers and waste management companies are free to compete and collaborate to find the most efficient way to collect and recycle products and materials, such as old electronics, used tires, and packaging. A recent report on EPR guidance by the Organization for Economic Co-operation and Development acknowledges this fact and encourages countries to strengthen competition in recycling markets both among service providers and producers.
Under Germany’s EPR system, for example, producers were initially allowed to carry out their responsibility to recycle through a single producer organization called the Duales System Deutschland (DSD). However, under this arrangement, the DSD began to engage in anti-competitive practices, which included awarding excessively long, sole-sourced contracts. In
response, the German Federal Cartel Office intervened by ending the process of selective tendering and allowing all qualified service providers to compete for contracts to collect and process waste. Next, the cartel office removed the monopoly control the DSD had over the marketplace and allowed new producer organizations to procure waste management services. Now, with competition among service providers and producers, costs are down significantly.
Canada and emerging opportunities
The ongoing developments and international discussion on competition are especially important for Canada as provinces continue to adopt EPR programs or adapt existing systems.
The Government of British Columbia is currently assessing the role of competition within its EPR system, and the Government of Ontario has affirmed the role of competitive markets in its recently passed Waste-Free Ontario Act. Of specific interest with Ontario’s legislation is the reference to Canada’s Competition Act. This provision makes it clear that nothing producers or service providers do in complying with the new provincial law provides them with a defence for anti-competitive behaviour as defined under federal competition law. It also ensures that Canada’s Competition Bureau can oversee and enforce all applicable competition rules in Ontario’s EPR markets.
The Waste-Free Ontario Act presents a unique opportunity for the province to not only increase waste diversion, but to also lead the North American and international discussion on market-based environmental policy by putting competitive concepts and principles into practice.
Moving forward, however, it will be important for the Competition Bureau to engage with producers and service providers to discuss the current dynamics within the EPR marketplace and ensure they have the proper guidance to operate in accordance with Canada’s competition laws.
ReThink Competition & EPR Conference
To facilitate a discussion about these recent developments, the Ontario Waste Management Association is bringing producers, regulators, municipalities, and waste management companies together this autumn at a special conference in an effort to chart the course for competitive EPR systems in Canada.
The ReThink Competition & EPR Conference will take place on November 8 at the Holiday Inn Toronto International Airport. The program will include a comprehensive overview of the issues, challenges, and opportunities facing industry and governments as provinces work to reform and build up competition in recycling markets.
At the event, you’ll hear from leading-industry experts from across Canada and around the world, as well as provincial regulators and representatives of the Competition Bureau, on designing competitive EPR systems, maintaining fairness and openness in the marketplace, and enforcing competition rules.
For such an important topic, you really won’t want to miss this excellent opportunity to learn about the latest trends, gain insight into the changing policy landscape across the country, and network with your colleagues in government, business, and the not-for-profit sector. Mark down November 8 on your calendar for this important conference and don’t forget the 7th Annual Canadian Waste to Resource Conference is at the International Centre on November 9 and 10.