European rules meant to shrink the continent’s mountain of packaging waste came into force on 12 August, and the immediate effect on small Dutch webshops has been paperwork rather than anything greener.
Any retailer sending parcels across a border must now record exactly what each piece of packaging is made of. A cardboard box with a label means declaring the board, the paper, the ink and any coating.
Heavy metals and contaminants in the packaging have to be listed as well. The requirements tighten over the next few years: from 2030, sending a small item in an oversized box padded out with filler will no longer be allowed.
The problem the rules were written to solve is real. Around three in four of Europe’s 450 million consumers now buy something online, and packaging waste has reached more than 177 kilos per resident per year, 35 kilos of it plastic.
The rule is European. The paperwork is national.
The regulation applies across the European Union, but each member state was left to implement it in its own way. For a business shipping to customers in several countries, that turns one rule into a stack of separate national procedures.
A seller must appoint a representative in every destination country. Across the 27 EU states plus the United Kingdom, which is taking part, that means at least as many ministries, agencies and private bodies handling registration, each asking for different information in a different way.
France requires registration with two separate organisations. Some national portals operate only in the local language, which for a small Dutch trader can mean the process is simply unusable.
Traders comparing the various official websites have reported not being able to tell, at first glance, which were genuine and which were scams.
The bill before a single sale
An industry of intermediaries has appeared to handle the registrations. The cheapest widely used option, a German firm, charges 300 euros per country.
Covering the whole of Europe therefore costs close to 7,000 euros before a single item has been sold.
Set against that, a small operator may spend under 750 euros a year on packaging material in the first place. The compliance cost can be roughly ten times the cost of the thing being regulated, with no reduction in waste to show for it.
The pressure is not only financial. Retailers who sell through the large platforms have been told their listings may be pulled in markets where they cannot show a local registration, which turns an unfinished form into lost revenue overnight.
Why the large platforms are comfortable
Online retail specialist Patrick Petersen calls the result a textbook market distortion. Large operators absorb this kind of regulation with software and dedicated compliance teams, he argues, while a small webshop owner works through a forest of European registrations by hand.
The intention is good for the planet, but he warns the execution risks smothering innovation and local commerce in European e-commerce.
The platforms themselves do not dispute it. A spokesperson for Bol acknowledged that smaller sellers have less specialist capacity for legislation, compliance and data.
Amazon says it intends to offer a programme, at a price, to help selling partners meet the requirements.
Written at a desk
Hester Klein Lankhorst, director of Verpact, the Dutch organisation that arranges packaging collection and reuse on behalf of retailers, believes the rules were drafted with large webshops in mind.
It was all thought up at the writing desk, she said, without enough regard for small businesses or for how widely the rules vary between member states.
Verpact has decided to change nothing for Dutch traders until there is more clarity about how the regulation is actually to be applied. The body responsible for enforcing the rules here is, in effect, waiting to be told what they mean.
Brussels retreats, by social media post
The protest has not been confined to the Netherlands. Small traders across Europe have described online watching their businesses become unviable over the administration alone.
The European Commission appears to have heard it. In an Instagram post it said it would ask the European Parliament to scrap the requirement to register separately in each member state, and called on national governments to hold off on issuing fines for the time being.
The manner of the retreat has not gone down well. Traders have pointed out, with some bite, that a social media post is not a legal instrument, and asked whether a Commission Instagram account is a defence they can offer when a fine arrives.
