Notice to All Brand Owners Selling Beverage Products in New Brunswick

Subject: Update on Transition of New Brunswick’s Beverage Containers Program to an Extended Producer Responsibility (EPR) Model

With the many changes on the horizon regarding the April 1, 2024, migration of the New Brunswick Beverage Containers Program (BCP) to an extended producer responsibility (EPR) model comes much planning here at Encorp Atlantic/Atlantique (“Encorp”).

As the official not-for-profit producer responsibility organization (PRO) that will operate this EPR Program, Encorp recently met its obligation of submitting a 5-year Stewardship Plan for the new EPR program to Recycle NB, the umbrella organization that oversees all designated materials EPR programs in New Brunswick, as required by legislation, by August 1, 2023. The Stewardship Plan is currently being reviewed for approval by Recycle NB, and we will inform all stakeholders once it is approved and available for all stakeholders to read.

We ask all beverage product brand owners to take note of the following updates related to the transition to EPR. Should you have any questions or concerns, please email us at [email protected] or call us at 1-877-389-7320.

Timelines Mandated by the New Brunswick Government:

The New Brunswick BCP is mandated to transition to an EPR model on April 1, 2024. Important dates and associated requirements to note are the following:

• Before August 1, 2023, the Agent representing beverage brand owners, Encorp, is required to provide a Stewardship Plan to Recycle NB for approval. (Completed – Approval Pending)
• Before August 1, 2023, beverage product brand owners are required to register with Recycle NB. (Completed – brand owners who have not yet registered can still do so at https://www.recyclenb.com/industry-beverage-containers)
• Before March 31, 2024, the Agent representing beverage brand owners, Encorp, must attempt to enter into agreements with existing used beverage container (UBC) return facilities known as redemption centres to provide UBC collection services under an EPR model for at least two years. (Ongoing)
  

Deposits & Fees:

• The New Brunswick Designated Materials Regulation (Clean Environment Act) requires the new EPR BCP to move to a fullback deposit/refund structure. More details will be confirmed by Encorp this fall on what the deposit amounts will be per container type. Still, it is possible at this time to confirm that there is no planned increase to current deposit amounts. Note that under the current “half-back system” on all containers except refillables, the non-refunded part of the deposit for taxable beverages is subject to HST. Once the system moves to a fullback, the deposit will not be subject to HST.
• As with other fullback deposit models in Canada (i.e., British Columbia, Alberta and Saskatchewan), a container recycling fee (CRF) will be required to cover the shortfall between revenues from unredeemed deposits, material value and the cost to run the system, especially as container recovery rates increase. Details are as follows:

• • Brand owners may or may not choose to pass on the CRF (once instituted).
  • Unlike other provinces, but as is the case with every other product stewardship program in NB, recycling fees will have to be internalized.
  • The deposit paid by consumers will not be considered the fee, given that the customer can be refunded the deposit. Therefore, the deposit must be shown as a line item on the Point-of-Sale (POS) receipt.
  • The mandate for internalized fees does not apply to business-to-business (B2B) invoices.
  • The presence of the CRF will be allowed to be mentioned on shelf talkers and at POS, but must not be shown as a line item with the subtotal, HST, etc.
  • More details will be confirmed by Encorp this fall on what the CRF amounts will be per container type.
  • Once this CRF is implemented, it will be subject to HST.

Important Upcoming Communications for Brand Owners from Encorp:

• In October 2023, Encorp will send all brand owners who have registered with Recycle NB for the new EPR BCP a Brand Owner Information Package (including the deposit amounts and estimated CRF ranges as well as agreements to review/sign designating Encorp as their PRO/Agent for the new EPR Program). At this time, brand owners will also receive an invitation to participate in information webinars. The information package will be sent by mid-late October, and the webinars will be held within the following two weeks to give enough time to review the information package’s contents before participating in the webinar.
• In the winter of 2024, Encorp will issue follow-up communications with registered brand owners to prepare them for the implementation of CRFs and the new deposit/refund structure, including user login/password info and training on navigating a new portal on Encorp’s website to remit deposits/CRFs and details on important dates and other information related to the launch of the new EPR BCP (product registration, when to remit their first deposits/CRFs under the new EPR Program, reporting periods, etc.).

We appreciate your continued patience and cooperation as we navigate these changes. We will keep brand owners informed as best we can as we prepare for this important and exciting transition to EPR. The long-awaited move towards full refunds for consumers on deposits paid for beverage products required by the newly amended Designated Materials Regulation means we can expect UBC recovery volume increases and a renewed public interest in the program. Our Stewardship Plan, awaiting approval by Recycle NB, calls for providing tools and technologies to redemption centre operators to improve access and convenience to UBC recycling for beverage product consumers, increasing communication and outreach initiatives, and launching deposit-bearing UBC recycling programs targeted at schools and community groups across the province. The new EPR BCP will prioritize environmental performance, expand UBC return/collection options across the province, enhance the UBC return/redemption experience, and reduce littering in public outdoor spaces. We are excited for you to be part of this transformative journey with us.

Sincerely,

Pierre Landry, President & CEO, Encorp Atlantic