Producer Responsibility Organisations (PROs)
).
The PRO is a cooperative industry effort to shoulder the responsibilities of
its member companies and meet their EPR obligations...
Most PROs in operation
collect a fee directly from the producers based on a specific fee structure.
PROs can also have various functions extending beyond the financing and logistics
of take back, such as education and training of producers and consumers,
controlling, reporting and supporting research and development. The
proliferation of EPR laws has resulted in the setting up of many, mainly
not-for-profit, PROs, especially in Europe.
E-waste in Switzerland,
and in several other countries, is managed by PROs which bear the responsibilities
of the producers collectively.
Monopoly Power
EPR may in certain cases result in firms abusing a
dominant position and indulging in price fixing and anti-competitive behaviour
which results in inefficiency. The waste
management and recycling fields in particular have always been connected with
the problem of monopolies. In the case of the SWICO and SENS
systems, there is the threat of the PROs becoming monopoly players as well as
large recyclers who might drive out smaller recyclers and create a monopoly.
PRO Monopoly
The ORDEE does not elaborate the implementation of the
directive, merely outlines the essential guidelines. Therefore, it doesn't give
the PROs the specific mandate for the collection. The companies have the choice
of either participating in the PRO or setting up a parallel system. In case of
consumer or recycler complaints of monopolistic abuse of power by the PROs, the
competition authorities have the power to intervene. Transparency regarding the
collection, financing and contracting processes helps alleviate the concerns of
PRO monopoly.
Recycler Monopoly
In the current system, recyclers are licensed by the PROs,
with licenses being granted only for a two year period. The SWICO system, which
grants the rights to the lowest bidder, prevents large firms from becoming a
monopoly player by restricting territorial rights to recyclers who can show
that the transport distances are, on an average, 30 km or less, from the
dealers to the recycling facility. The SENS system ensures competition for the
market among recyclers by fixing an average price, between the highest and the
lowest quotes, and letting the retailers choose the specific recycler. The
project team also monitors recycling prices in neighbouring countries to ensure
that recyclers do not over bid.