Extended Producer Responsibility fees used to be simple: pay a rate per tonne based on your material type, and move on. That model is disappearing. Across the UK and EU, EPR schemes are shifting to modulated fees - charges that vary based on the recyclability of your packaging. The commercial impact is significant, and the businesses that understand it earliest will pay the least.
What fee modulation means in practice
Fee modulation means that the cost of your EPR obligation depends on how recyclable your packaging is. Packaging that is easy to collect, sort, and recycle attracts lower fees. Packaging that is difficult or impossible to recycle attracts higher fees - sometimes substantially higher.
This is not a future concept. It is happening now. The UK, Germany, and France all apply some form of fee modulation today, and PPWR will extend it across the entire EU by 2030.
UK: RAM scores drive the invoice
The first UK packaging EPR scheme year was charged at base rates, with recyclability modulation applying from the second year. The UK system uses the Recyclability Assessment Methodology (RAM v1.1, developed by Defra and PackUK) to classify components as Red, Amber, or Green. The classification directly influences the fee multiplier.
A Green-rated component - one that is widely collected, sorted, and recycled in the UK - attracts the standard fee. An Amber-rated component, where recycling infrastructure is developing but not yet established, attracts a higher fee. A Red-rated component - not recyclable in practice in the UK - attracts the highest fee.
The difference between Green and Red can be substantial. For a large producer, the aggregate cost difference across thousands of SKUs runs to hundreds of thousands of pounds per year.
Germany: ZSVR minimum standard
Germany has had recyclability-linked fees for longer than most markets. The Zentrale Stelle Verpackungsregister (ZSVR) publishes a minimum standard for recycling that determines whether packaging is considered recyclable under the VerpackG system. Dual system operators (Der Grune Punkt, Interseroh+, and others) use this assessment to set fee levels.
Non-recyclable composites and multi-material flexible packaging attract the highest fees. Mono-material packaging that is compatible with existing sorting and recycling infrastructure attracts the lowest. The bifa catalogue published alongside the ZSVR standard provides the technical assessment framework.
France: explicit bonuses and maluses
France, through CITEO, applies the most explicit eco-modulation system. Packaging that meets recyclability criteria receives a bonus (fee reduction). Packaging that uses disrupting materials - materials that contaminate recycling streams - receives a malus (fee surcharge). Including recycled content above certain thresholds triggers additional bonuses.
The French system publishes a detailed schedule of bonuses and maluses, making the financial impact of each design choice transparent. A packaging designer can look up exactly what a specific material change would save or cost in CITEO fees.
The compounding effect across markets
A brand selling the same product into the UK, Germany, and France faces three different fee structures, three different recyclability assessments, and three different optimisation levers. A design change that reduces fees in one market may have no effect - or even increase fees - in another.
For example, switching from a multi-material laminate to a mono-material PE pouch might improve your ZSVR score in Germany (reducing fees there) but have no effect on your CITEO fees in France if the new material still attracts a malus for another reason. Without modelling the fee impact across all your markets simultaneously, you are optimising blind.
What to do about it
The approach is straightforward: model your fee exposure per jurisdiction, identify which components drive the highest cost, and prioritise redesign where the financial and recyclability gains overlap.
This means running each component through the relevant recyclability assessment for each market (ZSVR for Germany, COTREP for France, RAM for UK, KIDV for Netherlands, and so on), mapping the results to the fee schedules published by each scheme, and aggregating the cost at SKU and portfolio level.
Merchant Packaging holds the recyclability grade for each component and the fee schedules per scheme. It estimates UK EPR fees from them, and applies eco-modulation bonus and malus rules in the France and Germany declarations, so you can see where your money is going - and where design changes would reduce it.
The data you already hold in Merchant Packaging for EPR declarations is the same data that feeds fee estimation. The cost reduction opportunity is already in your system.