Ontario proposes to expand producer responsibility for hazardous and special products: What your ‎business needs to know to manage the transition

As discussed in our previous article on Ontario’s Blue Box waste diversion program, the Ontario Ministry of the Environment, Conservation and Parks (the “Ministry”) is developing a suite of regulations under the Resource Recovery and Circular Economy Act, 2016 to further extend producer responsibility for the collection and management of a variety of products at the end of their useful life. This article continues this discussion by examining a recently proposed draft regulation for hazardous and “special” products, which, if approved by the provincial cabinet, will come into full effect July 1, 2021.

On February 11, 2021, the Ministry published a proposed Hazardous and Special Products (“HSP”) Regulation, which, if approved, will shift responsibility over all products managed by the Municipal Hazardous or Special Waste Program and other hazardous products, such as mercury-containing barometers and thermometers, from municipalities to producers of those products. This change will make producers legally accountable and financially responsible for collecting and managing HSP at the end of the product lifecycle. The stated rationale is that the transfer of the financial burden from municipalities and taxpayers to producers will make the system more efficient as it encourages producers, who are in a better position to facilitate necessary changes, to find newer, more innovative, and more cost-effective ways to manage HSP and establish sustainable business models.

Specifically, the Ministry describes its proposed HSP Regulation as requiring producers to:

• establish free collection networks for consumers;
• manage all collected HSP properly by adhering to disposal and recycling procedures;
• provide promotional and educational materials to increase public awareness; and
• register, report, and provide audited/verified sales data, as well as comply with various other requirements, including the keeping of records concerning the acceptance, transferring, processing and disposal of HSP.

The Ministry intends for the proposed changes to make the HSP collection network more accessible to consumers, thereby helping to reduce the quantity of hazardous material going to landfill and promoting greater resource recovery.

Who is a producer?

A “producer” in the proposed HSP Regulation means a person who is required to carry out responsibilities in the proposed regulation. Generally, it is the brand holder resident in Canada. However, in certain situations where the brand holder is not resident in Canada, an importer of the product resident in Ontario or the first marketer of the product could be the producer for the purpose of the regulation with the resulting responsibilities.

Four categories of HSP

The proposed HSP Regulation will divide and manage HSP materials into four categories and impose differing levels of obligations and requirements per category:

Category A includes non-refillable pressurized containers and oil filters;

Category B includes antifreeze, paints and coatings, pesticides, solvents, oil containers, and refillable pressurized containers;

Category C includes barometers, thermometers, and thermostats that contain mercury; and

Category D includes fertilizers (excluding fertilizer used for commercial or agricultural propose, or supplied in large containers).

Establishing collection networks

Producers of Category A and Category B Products are required to establish and operate a collection system for each applicable HSP, which will consist of collection sites and collection events. The minimum number of collection sites will depend on the municipality’s population, the number of retail locations that supply applicable HSP in the area, and the size of the producer (determined by the quantity/weight of HSP supplied). A producer will generally be required to establish one or more collection sites in each local municipality where retail locations supplying the applicable HSP are located. Similarly, a producer will, in most instances, be required to establish at least one collection site in any local municipality with a population of 1,000 or more, even if no retail location is present. The more retail locations or higher the population, the more collection sites are required.

Large producers will also be required to operate HSP collection events in each local municipality with a population of 5,000 or more. The population in each municipality will determine the minimum number of event required in the municipality.

Should the HSP Regulation be approved in its present form, producers will have 18 months to establish their collection network and obtain all necessary Ministry approvals.

Management of HSP

Once collected, producers of Category A, B, and C Products are required to manage the collected HSP in accordance with the HSP Collection, Processing and Disposal Procedure spelled out in the draft regulation. Producers also have to ensure that the HSP processors are registered, process the recovered resource in accordance with the procedure, and meet certain recycling efficiency rates prescribed for each product type.

Producers of Category A Products have to meet additional target requirement of managing a minimum amount of materials from each HSP calculated by the weight of Category A Products supplied in the past three years.

Promotion and education

All producers of HSP are required to implement promotional and educational programs to raise public awareness of the producer’s efforts in managing HSP, including distribution to consumers. In general, the programs inform the public about the details of HSP collection sites and events and encourage public participation. Additional obligations or different requirements may apply depending on the category of the products.

Registration, reporting, auditing, and record keeping

If the draft HSP Regulation is approved, every producer who markets HSP in Ontario will be required to ‎register on or before May 31, 2021 if the producer marketed HSP between January 1, 2018 and May 31, ‎‎2021, or within 30 days if the producer marketed HSP after May 31, 2021. There is no registration ‎deadline, however, for a “volunteer organization”. A volunteer organization is a brand holder not resident ‎in Canada that voluntarily registers as a “producer” in order to fulfill the requirements of the HSP ‎Regulations on behalf of an importer, or marketer of the volunteer organization’s product, who would ‎otherwise be obligated to comply with the regulations.‎

Every registered producer must submit an initial report describing how it plans to fulfil its HSP responsibilities. The deadline for such submission is May 31, 2021 for producers who register on or before May 31, 2021. Additionally, registered producers will also be required to submit annual reports that describe the actions taken to fulfil any responsibilities, including information on the total weight of HSP collected, processed, and disposed. Related parties, such as volunteer organizations, producer responsibility organizations, HSP haulers, and HSP processors, are subject to similar annual report obligations.

Every producer and all related parties must keep records for five years. Producers of Category A, B, and C Products have the additional responsibility of preparing and submitting annual audit reports.

Exemptions

There is a quantity exemption available to producers. If the weight of the Category A, B, or C Products that is supplied by the producer in Ontario in the previous calendar year is not more than the product specific limit, ranging between 1 to 20 tons depending on the types of product (although no information on the limits of Category C Products is available as of the writing of this article), the producer may be exempt from collection, management, registration, reporting, and auditing obligations. However, the exemption does not appear to directly relieve the producer from promotion and education obligations.

Protocol

The Ministry is currently seeking public feedback on the proposed HSP Regulation. Stakeholders who wish to provide input into final form taken by the proposed regulation can review the draft regulation and provide feedback here. The deadline for ‎public comments is Sunday, March 28, 2021‎.

This article provides only general information about legal issues and developments, and is not intended to provide specific legal advice. Please see our disclaimer for more details.