Packaging in 2026: How the UK’s EPR Law Redefines Producer Responsibility

Packaging waste is no longer just a consumer or council problem; it’s becoming a producer’s responsibility. Around the world, governments are rewriting the rules of waste management to drive more sustainable supply chains, and packaging is at the center of the shift. 

In the UK, new Extended Producer Responsibility (EPR) legislation will make brands and manufacturers financially accountable for the recycling and disposal of the packaging they put on the market. And the UK is not alone; other major economies are already preparing to follow suit. 

What is Extended Producer Responsibility (EPR) Legislation?

In 2023, the UK implemented EPR regulations that aimed to encourage producers to manage the entire lifecycle of their packaging waste. Businesses that fall under the UK government’s definition of a packaging producer are now obligated to collect and report their data to the Department for Environment, Food and Rural Affairs (DEFRA). From October 2026, these data returns will generate a company-specific waste management fee based on levels of recyclability and volume of packaging waste, which will now be fully enforceable. 

A producer under UK EPR is any UK business that puts packaging on the UK market, either under its brand, by importing, or by directly supplying packaging to consumers. It is important for distributors and OEMs to understand their responsibilities under this system, and to seek out clarification where regulatory impact is unclear. 

How EPR Legislation Could Hit Your Bottom Line 

An Illustrative example of potential EPR impact – (note actual DEFRA fees is still to be finalized, this is a hypothetical case). 

The implementation of EPR will have a measurable impact on a company’s profitability. Consider a mid-sized CPG company as an illustrative scenario, with £500M in revenue and 5,000 tons of packaging per year. EPR fees and compliance costs could reduce net profit by as much as £2.25M, or 2.25% (based on a 40% gross margin and 20% operating expense assumption). This includes £2M in packaging fees and £250,000 in administrative and reporting expenses. Beyond the immediate financial impact, businesses may also bear additional costs from supply chain adjustments, potential price changes and investments in more sustainable packaging. 

Actions for Producers of Packaging Waste 

Businesses must immediately determine whether they qualify as a ‘producer’ of packaging waste in the UK and extend this assessment to all regions where new legislation is coming into force. This includes the EU’s Packaging and Packaging Waste Regulation (PPWR), which will progressively tighten enforcement between 2025 and 2030; making proactive compliance essential to avoid penalties and secure competitive advantage. 

Companies need to take action if all of the following apply-: 

• Individual business, subsidiary or group (but not a charity)
• Annual turnover of £1 million or more, based on your most recent annual accounts up to April 7th
• Responsible for importing or supplying more than 25 tons of packaging to the UK market in the previous calendar year
• Carry out any of the packaging activities 

Companies identified as impacted by the EPR scheme must immediately ensure full compliance with all data recording and reporting requirements from the previous year. They should proactively assess the financial impact of fees and charges, exploring mitigation options through supplier negotiation, procurement strategies, or adjustments to product pricing. 

Source: Extended producer responsibility for packaging: who is affected and what to do - GOV.UK 

Equally critical is maintaining robust, auditable packaging data as EPR regulations evolve, particularly as fees become increasingly linked to recyclability and reporting accuracy. High-quality historical data is not only essential for compliance, but for avoiding penalties, reducing fee uncertainty, protecting margins, and maintaining control over long-term EPR cost exposure in a rapidly tightening regulatory landscape. 

Opportunities for Packaging Producers 

EPR and associated legislation might appear like a potential headache for packaging producers, but through early adoption and a re-thinking of supply strategy, firms have an opportunity to capitalize on the change. 

Development of brand capital: 

There is an opportunity for firms to position themselves as ‘early adopters’ as part of a wider sustainability strategy. This is particularly relevant for CPG companies where demand is heavily reliant on the brand loyalty they can generate amongst their consumer base. In many regions of the world, environmental impact is becoming a key component in consumers’ purchase decisions—compliance and overall waste management improvement under EPR will only improve this. 

Cost-sharing with manufacturers: 

Whilst responsibility lies with the importer of record or entity bringing the goods to the market, companies should engage with their own suppliers to clarify EPR and to bear some of the potential costs associated with legislation changes in their future pricing. 

Develop a roadmap for future packaging innovations: 

Companies should engage internally and externally to help develop more sustainable packaging innovations. This could be through a reduction in existing use of packaging, or by switching to materials and designs with greater recyclability and therefore lower charges under EPR. 

Modulated EPR fees turn packaging design into a cost lever: 

Producers that simplify materials, improve recyclability, and optimize labels can move into lower fee bands and avoid recurring penalties, while poor design choices lock in higher costs year after year. Acting early allows producers to control future EPR exposure rather than absorbing escalating, non-negotiable fees. 

By rethinking their approach now, packaging producers can turn regulatory pressure into competitive advantage. Those who act early and leverage their supply chains and relationships effectively won’t just comply with legislation; they’ll lead the shift toward more sustainable packaging, win customer trust, and stay ahead of slower-moving competitors.