A Scottish retailer taking legal action against deposit return scheme (DRS) administrator Circularity Scotland Limited (CSL) claims he would lose over £60,000 a year if the commission offered to stores isn’t increased.
DRS is set to be rolled out across Scotland next August. Earlier this year, CSL revealed the handling fees participating stores would receive.
Those operating a manual scheme will receive a 2.69p handling fee per item returned, and those operating a reverse vending machine (RVM) will earn 3.55p for the first 8,000 items returned each week, with an extra 1.5p for each additional item.
Abdul Majid, owner of 2,500sq ft Nisa Local Bellshill, North Lanarkshire, raised judicial review proceedings in the Court of Session against CSL last week, claiming “the handling fees aren’t enough to cover the costs involved in operating the scheme”.
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He told Better Retailing: “After calculating the costs involved to run a RVM in store, with the current commission, I’m standing to lose approximately £1,200 a week, equating to £62,000 a year.
“The way this has been sold to retailers is far too simple. These projections were done about four years ago, and if you look at the current energy and inflation crisis, it is clearly going to cost more now.”
The move has been supported by the Scottish Grocers’ Federation, which has already issued a pre-action letter to CSL, warning of similar challenges.
Majid added he believes the handling fee needs to be raised to 12.1p per container.
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