Addendum to Final Business and Regulatory Impact Assessment for the Deposit and Return Scheme for Scotland Regulations 2020: October 2026

Issue and why it needs to be addressed

4. As part of plans to create a more circular economy, the Scottish Government intends to introduce a Deposit Return Scheme (DRS) for single-use drinks containers made of polyethylene terephthalate (PET), steel, and aluminium cans from 1 October 2027.

5. The Scottish Ministers have designated a private, not-for-profit organisation, Exchange for Change, as the scheme administrator that is responsible for undertaking the functions under the Deposit and Return Scheme for Scotland (Designation of Scheme Administrator) Order 2025 to deliver the scheme on behalf of industry.

6. The Deposit and Return Scheme for Scotland (Designation of Scheme Administrator) Amendment Order 2026 will amend the existing Deposit and Return Scheme for Scotland (Designation of Scheme Administrator) Order 2025 and, along with the Deposit Return Scheme for Scotland Amendment Regulations 2026 (the Regulations), will make some operational amendments to help support the introduction of the scheme for industry and correct minor drafting oversights.

7. The amendments are proposed to support the effective implementation, business readiness, and enforcement of the scheme across Scotland. They also seek to ensure maximum interoperability with schemes being delivered in England, Northern Ireland and Wales.

8. The proposed amendments to the existing DRS regulations and Designation Order will have the following effects.

9. SEPA regulatory charging. Bring forward the date from which the Scottish Environment Protection Agency (SEPA) can recover costs from the scheme administrator (Exchange for Change) to the date after the Regulations come into force. This will enable SEPA to fulfil its regulatory functions in relation to the functions of the scheme administrator and support scheme implementation prior to launch on 1 October 2027. It will also allow early commencement of SEPA’s powers enabling the enforcement of such charges from the same date.

10. Export shops. Remove the provision which exempts export shops from complying with obligations relating to marketing, offering for sale or selling articles, including charging a deposit on scheme articles, and also remove the return point exemption for export shops.

11. Hospitality retailers. Provide hospitality businesses (e.g. cafes or bars) with greater flexibility in determining whether to charge deposits on scheme articles which are sold exclusively for consumption on the premises of sale. Currently, there is an exemption for hospitality retailers who sell scheme articles for consumption exclusively on the premises of sale from complying with obligations relating to marketing, offering for sale or selling articles, including charging a deposit on scheme articles. The proposed amendments will replace this with a new provision to allow hospitality retailers to decide not to charge the deposit on scheme article sold exclusively for consumption on the premises of sale.

12. Hospitality retailers will have the option to charge deposits on scheme articles sold for consumption on premises, or to operate a ‘closed loop’ system with no deposit charged to the consumer when drinks are intended for consumption exclusively on the premises.

13. If operating a ‘closed loop’ system, the hospitality retailer will be required to inform customers that no deposit is required to be charged and that scheme packaging should not be removed from the premises.

14. If charging a deposit, the hospitality retailer will be required to comply with existing retailer obligations to inform customers that a deposit is charged, and the location of the nearest return point.

15. A hospitality retailer may retain empty drinks containers for collection by the scheme administrator, but will no longer be required under DRS Regulations to retain containers for collection. In these circumstances the scheme administrator must collect the DRS empty drinks containers if requested by the hospitality retailer. The hospitality retailer remains subject to the duty of care in relation to waste under section 34 of the Environmental Protection Act 1990 and the related code of practice.

16. These amendments bring obligations on hospitality retailers into alignment with schemes in England, Northern Ireland and Wales.

17. Scheme administrator powers to charge interest on late payments. The scheme administrator is given the power to charge interest on late payments of registration fees, should a registered producer fail to pay their fees at the times and intervals or by the means specified by the scheme administrator. This provides clarity for industry on the way in which the scheme administrator can carry out its function in relation to charging the registration fee to registered producers.