In 2023, Hungary introduced the Extended Producer Responsibility (EPR) system, which places the financial responsibility for the waste management of circular products on producers.
The EPR system encompasses a wide range of product streams, including packaging, single-use and other plastic products, electrical and electronic equipment, batteries and accumulators, motor vehicles, tyres, office paper, advertising paper, cooking oil and fat, textile products and wooden furniture. Producers, or in the case of foreign manufacturing, the first domestic distributor of such products, are required to comply with registration, reporting and EPR fee payment obligations.
From dual obligations to sole EPR compliance
A significant recent change in the regulatory framework is the removal of the dual obligations that previously applied to certain products. Prior to the recent amendments, products such as packaging, batteries, electrical and electronic equipment, tyres, office paper and advertising paper were subject to both the environmental product fee and the EPR system. These parallel responsibilities created an excessive compliance burden for the affected businesses while securing no additional tax income for the state budget.
With the recent revisions, the environmental product fee payment obligation has been eliminated for these products, and producers are now only required to comply with the EPR system. While this simplifies the regulatory landscape by removing overlapping obligations, it also places greater emphasis on ensuring compliance with the EPR rules.
Changes in sanctions for non-compliance
Failure to meet the EPR registration, reporting or fee payment obligations can result in substantial financial penalties. Businesses that fail to register are required to pay retroactive EPR fees for the products placed on the market before registration.
Another key change introduced by the amendments is the imposition of stricter sanctions for non-compliance with EPR reporting and fee payment obligations. Effective from 1 April 2025, if a producer fails to meet its reporting and fee payment obligations, or if false data is provided leading to a lower fee payment, the competent waste management authority may impose a fine. This fine will be determined by multiplying the difference between the actual quantity and the reported quantity by half of the unit fee established for the relevant product stream. Thus, fines can quickly escalate, especially for businesses with large product volumes.
Timely registration, accurate reporting and diligent EPR fee payments are essential to avoid significant fines and penalties. As Hungary's EPR system continues to evolve, seeking legal advice and proactively managing compliance will be critical to mitigating financial and reputational risks.
By Viktoria Hiesz, Attorney at Law, and Barbara Darcsi, Associate, Schoenherr
