ACCC extends environmentally-friendly container collection scheme

The Australian Competition and Consumer Commission has allowed an extension of an arrangement between agricultural and animal chemical manufacturers to charge a levy on the purchase by farmers of these chemicals to fund a container collection scheme, in a decision issued today.

"There is already an authorisation* in place for a scheme administered by Agsafe Limited to collect and dispose of unwanted empty agricultural and veterinary chemical containers", ACCC Chairman, Mr Graeme Samuel, said today.  "This determination extends immunity to allow the parties to the arrangement to continue imposing the levy and collection of the chemical containers".

The program is a component of the Industry Waste Reduction Agreement which aims to reduce waste at source and reduce the weight of packaging that is going to landfill throughout Australia.  Avcare Ltd, the Veterinary Manufacturers and Distributors Association, the National Farmers’ Federation and the Australian Local Government Association developed the drumMUSTER program to provide an environmentally responsible way of collecting and disposing of rigid steel and plastic containers which contain agricultural and animal chemicals.

"The ACCC believes that a scheme that protects the environment will benefit the public.  This scheme is likely to do that by reducing the number of non-returnable chemical containers being disposed of as waste, and provide an environmentally responsible way of collecting and disposing of rigid steel and plastic containers".

A levy of four cents per litre or kilogram on certain products sold in non-returnable chemical containers is imposed by the manufacturers, and paid for by farmers.  Without authorisation, the agreement may have raised concerns under the competition provisions of the Trade Practices Act 1974.

"The ACCC accepts that the imposition of the levy does constitute a detriment; but the ACCC considers that the impact on farmers is minimal given that the average percentage incurred by farmers on products is less than one per cent of the purchase price".

* The Trade Practices Act 1974 prohibits certain forms of anti-competitive agreements, including agreements between competitors that limit their ability to deal with whom they choose or on the terms they choose (including price). Authorisation provides immunity from court action under the Act arising from such agreements but can only be granted where the ACCC is satisfied that the public benefit flowing from the conduct outweighs any public detriment.