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12/01/04
Manufacturers set up recycling company “REPIC” to start operations in Spring
Manufacturers are setting up a company to manage the recycling operations under new European law which gives them responsibility for discarded electrical and electronic consumer products. REPIC – Recycling Electrical Producers Industry Consortium – is the working title of the company, which will begin setting up in the Spring.
They took the decision at a special meeting in London and issued an immediate invitation to the rest of industry: "Come and join us."
Twelve companies committed themselves to funding of £30,000 apiece to get the company up and running. They are Alba; B&W Loudspeakers; BSH Home Appliances; Glen Dimplex; Hoover Candy; In-Sink-Erator; Kohler Mira; Merloni Elettrodomestici UK; Numatic; Philips; SMEG; and Whirlpool.
AMDEA and Intellect are helping their member companies to establish the producer consortium which will manage all the processes required for manufacturers to meet their obligations under the new Waste Electrical and Electronic Equipment Directive [WEEED] from August 2005. SEAMA are also supporting the initiative.
A final draft of the Memorandum and Articles of Association for a member-based, not for profit company will be put before a meeting on 26 January. The consortium will be open to producers from the domestic appliance, consumer electronics and small appliance sectors. As defined by the Directive, these will include import agents and some retailers, as well as manufacturers.
The REPIC company name has been registered at Companies House, and three Web domains have been registered in its name. A job specification for a chief executive officer to head up operations has been agreed, recruitment specialists have been briefed and advertisements for the six-figure salary package post will appear shortly. It is expected that the company will begin operations in the Spring.
As Founder Members of the Consortium, the twelve companies have agreed to loan it £20,000 for two years. The Founder Member list will remain open to any other company until the end of March. There will be a flat membership fee for Founders of £10,000 – with a lower rate for SMEs. But after the 31 March deadline, the Membership Fee will be set at £30,000 – £6,000 for SMEs.
The government is preparing Regulations requiring all Producers to register between August this year and June 2005, possibly surcharging those who register after March 2005. From 1 January, DTI are proposing that these companies will be required to provide sales data to enable market share to be calculated to determine their responsibility for waste product.
REPIC think it likely that the registration authority may well ask which compliance scheme the applicant intends to use, or will otherwise record the company itself as taking direct responsibility for picking up and treating waste product. The Consortium will not only provide recycling services – it will also be heavily involved with the authorities in determining total market size so as to ensure producers do not take an unfair “market share” burden. The reduced Founder Member fee for REPIC therefore has an added attraction to companies who have not yet applied.
The Director General of AMDEA, Peter Carver, and Intellect’s Hugh Peltor announced the new company at a special meeting with DTI officials in charge of implementing the WEEE Directive in the UK. They explained that REPIC would write into its constitution commitments to high standards of environmental good practice in all its activities.
They made clear at that meeting that the Consortium would operate on a free market basis, and will be keen to reap the benefits of a competitive market among logistics and treatment service suppliers.
The consortium will benefit from economies of scale and competition among companies pitching for its business. With no shareholders to press for good profits, the aim is to offer attractively low prices.
Over 200 other companies eligible to join REPIC will shortly receive a letter from the trade associations, explaining the advantages of joining and inviting them to sign up.
Notes to Editors:
1) A member-based company is formed of organisations – in this case, manufacturing companies – rather than of shareholders.
2) "Not for profit" does not mean it cannot make trading surpluses. But these surpluses cannot be distributed like profits are to shareholders. They must be ploughed back into the business. And if the company is wound up, the assets cannot be distributed among the members – they must be passed on to be used for some like purpose.
3) Founder Members commit to make loan finance available to the Consortium of £20k over two years: the first tranche of £5k is payable on 31 March 2004 and the other three tranches of £5k on 31 July 2004, 31 January 2005 and 31 July 2005.
4) All Founder Members of the Consortium will pay a non-returnable £10k membership fee. Companies with turnovers of less than £3m who wish to be Founder Members will lend £4k to the Consortium through four payments of £1k, and their membership fee will be £2k.
5) The benefits for Founder Members are:
a) The ability to join with others to determine the structure, scope and trading policy of the Consortium;
b) The loans are interest-bearing
c) REPIC will be responding on 1 March to a DTI consultation on how the UK Regulations will be implemented in detail. So companies who join the new Company now will have input into that process.
6) Companies who become Members after 31 March will pay an entry fee of £30,000 [£6,000 for SMEs]
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