In the UK, packaging design is increasingly becoming a cost variable. From 2026/27, under the Extended Producer Responsibility (EPR) for packaging scheme, the disposal fees charged to large producers for household packaging waste are being modulated according to recyclability. Packaging that is harder to recycle attracts higher fees, while packaging rated as more recyclable can benefit from a discount.
The change directly affects liable UK businesses, but it also has implications for food manufacturers and exporters around the world. Where the EPR liability sits with a UK importer, brand owner or another operator in the supply chain, the packaging selected by the overseas supplier can influence the cost borne by its commercial partner. Recyclability may therefore increasingly become part of retailer specifications, sourcing decisions and supplier negotiations.
How EPR fee modulation works
The UK's Extended Producer Responsibility for packaging scheme shifts part of the cost of managing packaging waste to the businesses responsible for placing packaging on the UK market. Large producers covered by the scheme have obligations that include annual registration, six-monthly packaging data reporting and the payment of waste disposal fees for household packaging.
From the second operational year of the scheme, 2026/27, these fees are modulated using the Recyclability Assessment Methodology (RAM). In-scope packaging is assigned one of three ratings:
- green, for packaging that is more readily recyclable through existing UK infrastructure;
- amber, for packaging that faces certain challenges in collection, sorting, reprocessing or the quality of the resulting recyclate;
- red, for packaging that is more difficult to recycle at scale.
Amber is effectively the reference level. In 2026/27, red-rated packaging is subject to a 1.2 modulation factor against the amber fee, equivalent to a 20% uplift. The factor is scheduled to rise to 1.6 in 2027/28 and 2.0 in 2028/29.
For green packaging, the mechanism works in the opposite direction. The additional revenue generated by red-rated packaging is redistributed to reduce fees on green-rated packaging. The green discount is therefore not fixed in advance, as it depends on the overall mix of green, amber and red packaging reported across the scheme.
How much difference can recyclability make?
Final disposal fee rates for 2026/27 are not yet available. In its operational plan published in August 2026, PackUK said producer data would be scrutinised by the four environmental regulators before Year 2 disposal fees are calculated in November 2026.
Earlier illustrative rates nevertheless show how modulation can affect costs. For several packaging materials widely used in the food and beverage industry, PackUK published the following estimates:
| Material | Green | Amber | Red |
|---|---|---|---|
| Glass | £185/t | £205/t | £245/t |
| Paper and board | £190/t | £210/t | £250/t |
| Aluminium | £245/t | £270/t | £325/t |
| Plastic | £415/t | £455/t | £545/t |
| Fibre-based composites | £475/t | £525/t | £630/t |
These figures are illustrative only. They were published to help businesses forecast potential Year 2 costs and should not be treated as the final 2026/27 fee rates.
The main material is not the only factor
A RAM assessment does not simply ask whether a pack is made of glass, plastic or paper. The methodology considers whether the packaging can actually move through collection, sorting, reprocessing and application using established recycling infrastructure in the UK.
This means that labels, sleeves, closures, films, adhesives, coatings, barrier layers and combinations of different materials can all matter. A component that improves shelf life, technical performance or shelf appeal may also make a package more difficult to recycle.
This is particularly relevant in food packaging, where protection against oxygen, moisture, light or contamination often requires multilayer structures, barriers or components made from different materials. Businesses therefore need to look at the actual packaging configuration rather than simply the material that appears to be predominant.
Who is responsible for imported food packaging?
EPR obligations depend on the role an organisation performs in the supply chain and on its size. In general, an organisation is an obligated producer if it is established in the UK, has worldwide annual turnover above £1 million and is responsible for supplying or importing more than 25 tonnes of packaging in the UK.
Organisations with annual turnover above £2 million and responsibility for more than 50 tonnes of packaging are classed as large producers. Among their obligations, large producers must pay waste disposal fees for household packaging. Small producers have more limited registration and reporting requirements and do not pay these disposal fees.
For imported packaged goods, responsibility can fall on the UK importer or the first UK-established owner of the packaging, depending on the structure of the supply chain, whether there is a UK-established brand owner and who is responsible for the import.
An overseas food manufacturer that is not established in the UK - for example, because it has no UK registered office, branch, warehouse or other business address - will generally not be directly responsible for paying UK EPR disposal fees simply because it exports packaged food to the country. In these cases, responsibility for imported packaging will typically fall on the relevant UK-based operator, such as the importer or first UK owner, provided it meets the applicable EPR thresholds.
EPR can nevertheless have a direct commercial impact on overseas suppliers. The packaging they use affects its recyclability rating and, as a result, the disposal fees that may be paid by their UK partner. Importers and retailers may therefore increasingly ask suppliers to provide detailed packaging data, switch materials or components, or redesign formats that result in higher EPR costs.
Why importers and retailers may ask suppliers to change packaging
If the EPR cost is borne by a UK importer, retailer or brand owner, the supplier's packaging design contributes to the cost that operator may ultimately have to pay. RAM performance can therefore become increasingly relevant to product selection and supplier specifications.
A buyer may ask for more detailed information about packaging composition, require evidence supporting its recyclability assessment, prefer particular packaging structures or request changes to components that lead to a less favourable rating. EPR costs may also become one of the variables considered in price negotiations or when assessing the profitability of an individual SKU.
The commercial incentive is set to become stronger. The uplift applied to red packaging rises from 20% above the amber fee in 2026/27 to 60% in 2027/28 and 100% in 2028/29.
Why overseas suppliers should prepare now
There is also an important timing issue. The first modulated disposal fees for 2026/27 are calculated using data on packaging supplied in 2025. A redesign introduced today will therefore not change the first year of modulated fees, but it can affect assessments and costs in subsequent periods.
Food suppliers selling into the UK may benefit from collecting more granular information for each SKU, including packaging weight, materials, components, laminates, coatings, adhesives, labels and closures, and comparing their packaging formats against the RAM applicable to the relevant reporting year.
PackUK has already published RAM 2027, which applies to packaging supplied during the 2027 reporting year. RAM version 1.1 continues to apply to packaging reported for 2026.
For exporters, understanding the likely RAM performance of a pack can therefore become a commercial advantage as well as a compliance issue. It allows suppliers to enter discussions with importers and retailers with better information and to assess potential redesigns before recyclability becomes an even more significant component of the total cost of selling a food product in the UK.
Official information and guidance are available in the UK Government's Extended Producer Responsibility for packaging collection.
