Malta’s craft beer and cider scene will dry up if a bottle recycling scheme run by beverage sector kingpins is not changed, small-scale importers and manufacturers fear.

In a letter addressed to Environment Minister Aaron Farrugia, smaller players in the beverage space say that the rules will price them out of business, by treating them in the same way as polluters that place millions of beverage containers on the market.  

Their worry stems from a requirement that will see the recycling scheme’s operator, BCRS Ltd, receive €100 for each individual beverage placed on the local market.

The result, small stakeholders say, is that it will cost just as much to register a craft beverage imported in tiny quantities as it will to register a mass-produced beverage such as Coca-Cola or Cisk.

“A small importer may place 300 different products on the market per annum, while a large importer may only import five, mass-market products but these could constitute millions of beverage containers,” they tell the minister in a letter leaked to Times of Malta.

Signatories include Malta’s most prominent craft drinks importers and retailers, as well as manufacturers of local craft beers such as Lord Chambray and Huskie.

Under the existing rules, an importer with 300 different products will have to pay €30,000 to the recycling scheme - irrespective of how many beverage containers they are actually placing on the market. 

The craft beverage sector argues that it contributes “less than 0.001%” of all beverage imports into Malta and that the financial and administrative costs of adhering to the scheme are just too high for them to survive.

Who will run the bottle recycling scheme?

The government’s long-promised beverage container refund scheme is due to begin operating in April, five years after it was first announced.

The scheme will see 10c added to the cost of beverages sold in steel, aluminium, glass or plastic containers. Consumers must then recycle those containers at specially set up machines to recoup that 10c charge.

Rather than operate the scheme itself, the government has farmed the operation out to a private operator, BCRS Ltd.

BCRS, which is legally bound to run on a not-for-profit basis, is made up of some of the biggest stakeholders in Malta’s beverage sector, with companies such as Farsons, General Soft Drinks and P. Cutajar & Co. among those represented on its board of directors.

Wines and spirits exempted 

According to government targets, the scheme is expected to collect and recycle 70 per cent of all single-use beverage containers by the end of 2022, rising gradually to 90 per cent of all such containers by 2026.

But rather than requiring all types of beverages to be recycled, the government has exempted wines and spirits from the rules. Instead, only water, soft drinks, beers and ciders, readymade coffee and flavoured alcoholic drinks will be subject to the scheme.

The scheme will cover plastic, aluminium and glass containers - but wines and spirits are exempt. Photo: Shutterstock

The government agency established to regulate BCRS, Circular Economy Malta, states on its website that this is “based on how best practice countries operate”.

Small-scale craft drink stakeholders say that distinction is arbitrary and makes no sense from an environmental or legislative perspective.

Alternative systems

They believe there are ways of implementing a recycling scheme that does not choke competition, and cite Denmark as an example in their letter.

The Scandinavian country recoups an estimated 92% of its bottles and cans, using a system that allows small imports to participate without paying a high cost.

But BCRS, the craft beverage sector alleges, is unwilling to adapt Malta's scheme to ensure small-scale operators can survive once the scheme becomes operational.

“We have tried to engage with the operator to try and address our concerns to no avail,” they tell the minister, adding that they hope the ministry will amend the law to fix shortcomings and ensure that BCRS “is not allowed to use the system to stamp out competition.”

A copy of the letter was sent to the Office of the Prime Minister, Finance Ministry and scheme regulator, CE Malta.