DSD packaging scheme competitor ruled illegal

Court orders municipality to cease recovery scheme contravening national packaging law

Germany's national packaging recovery company DSD has won a court ruling that could force out of business a small competitive scheme that aimed to offer lower costs to municipalities (ENDS Daily 5 May 1998). In a ruling on 20 August, but only given wide publicity more recently, the Hesse administrative court found that a joint venture between the municipality of Lahn-Dill and a private company called Landbell was illegal.

According to a court statement posted by DSD on its web site, the venture did not have appropriate official clearance and failed to comply with the 1991 national packaging ordinance's requirement that all sales packaging should be separated by householders for collection. The ruling prohibits Lahn-Dill from continuing to participate in the "unauthorised, competitive [and] private" scheme for waste packaging collection.

The ruling overturns an earlier judgement by a local court, which rejected DSD's complaint against Lahn-Dill's recovery system in April 1998. According to the statement issued by the Hesse administrative court there is no right of appeal to its new ruling.

ENDS Daily was unable to obtain comment on the case from DSD today. However, in the wake of the court's ruling the Hesse state environment minister called on the federal government to amend the packaging ordinance to allow more competition and to help reduce costs to consumers.

The twin issues of costs and environmental standards lie at the heart of the dispute. DSD was given a national monopoly and charged with meeting high packaging recycling targets but has come under strong industry criticism for the costs it has imposed. Under Landbell's alternative, cheaper scheme, householders separate fewer types of packaging and the remainder is sorted centrally before the residual fraction, including plastics packaging, is incinerated.

In a confusing twist to the tale, a spokesperson for Landbell today denied that the Lahn-Dill collection scheme had been ordered to stop operating. According to the company, the court ruling has only required Lahn-Dill to drop out of its joint venture with Landbell and to cease advertising the scheme. Landbell's operations do not contravene national packaging law, the firm maintains, and have not been stopped. Furthermore, said the spokesperson, the municipality was, in fact, entitled to continue defending the scheme in the courts.

Follow Up:
DSD, tel: +49 2203 937 260; Landbell, tel: +49 6131 2356 520; Hesse environment ministry,, tel: +49 611 815 1022.

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