Producers' Financial Participation Policy

The Producers' Financial Participation Policy applies in in the framework of EPR Selective Collection and sets out: •   The obligated Producers (criteria, etc.); •   The targeted Materials; •   The Reporting terms, conditions and methodologies; •   The Eco-Modulated Financial Participation Schedule; •   The eco-modulation criteria; •   The Financial Participation payment terms; •   The collection procedures. The amendments to this policy, which was adopted by the board of directors of ÉEQ on March 30, 2023, are effective as of June 19, 2024. Producers are invited to consult ÉEQ website to see the tools available to assist them in the preparation of their Reports.

 

Scope

1.     This Policy applies to all Producers.

2.     The Small Producers’ Policy describes the criteria for exemption, eligibility for a simplified Report, the terms and conditions of a simplified Report and the resulting fixed Financial Participations.

3.     This Policy applies to any Voluntary Producer provided it meets the conditions set out in the Voluntary Producers' Policy and is duly accepted by Éco Entreprises Quebec (ÉEQ).

4.     This Policy forms an integral part of the Contract and the General Terms and Conditions, and it may be amended in accordance with the General Terms and Conditions to adapt to the evolving responsibilities of the Producers under the Regulation and changes to the System of Selective Collection of the Materials in Quebec.

Policy

5.     Unless otherwise provided, capitalized terms used in this Policy shall have the meaning ascribed thereto in the General Terms and Conditions.

6.     Obligated Producers

6.1  Obligated Producers are persons that:

(a)   Are the owners or users of a Name or Trademark;

(i)    When a Product or a Material is identified by more than one Name or Trademark owned by separate owners, the obligated Producer is the owner or user of the Name or Trademark that is most closely related to the production of the Product or Material;

(b)   Put Materials or Products, or offer Services on the Quebec market that generate Materials; and

(c)   Have a domicile or Establishment in Quebec.

6.2    Notwithstanding section 6.1 above:

(a)    Where a Producer has no domicile or Establishment in Quebec, payment of the PFP is then required from the First Supplier that has a domicile or Establishment in Quebec, with the exception of the manufacturer of:

                            (i)   a Product or Printed Matter whose Name or Trademark owner or user has no domicile or Establishment in Quebec;

                           (ii)   a Product that is commercialized, marketed or otherwise distributed without a Name or Trademark by means of a Container or Packaging; or

                          (iii)   a Material that is not identified by a Name or Trademark.

(b)    Where the First Supplier in Quebec does business under a Banner, the payment of the PFP is then required from the Owner of the Banner that has a domicile or Establishment in Quebec.

(c)    Where a Product or Printed Matter is acquired from outside Quebec as part of a sale governed by the laws of Quebec, by a person domiciled or having an Establishment in Quebec or by a municipality or public body within the meaning of section 4 of the Act respecting contracting by public bodies (CQLR c C-65.1), for their own use, payment of the PFP for the Materials (whether or not they bear a Name or Trademark) used for the commercializing, marketing or any other type of distribution in Quebec of such Product or Printed Matter is then required from:

(i)    the person who operates a transactional website through which the Product or Printed Matter was acquired, that allows a person who is neither domiciled nor has an Establishment in Quebec to commercialize, market or distribute a Product or Printed Matter in Quebec; or

(ii)     the person from whom the Product or Printed Matter was acquired, whether or not that person has a domicile or an Establishment in Quebec, in any other case.

6.3   Notwithstanding sections 6.1 and 6.2 above, in the case of Materials (whether or not they bear a Name or Trademark) added at a retail outlet or added when a Product or Printed Matter is acquired in Quebec through a transactional website, payment of the PFP is required from:

(a)   Where a point of sale is stocked or operated under a Banner:

(i)    the Owner of the Banner, if such Owner has a domicile or an Establishment in Quebec; or

(ii)     the Retailer, if the Owner of the Banner has no domicile or Establishment in Quebec;

(b)   Where a point of sale is not stocked or operated under a Banner:

(i)      From the Retailer, if the total surface area of the point of sale is ≥ 929 m²; or

(ii)     If the surface area is < 929 m², no PFP is payable, as provided in the Small Producers’ Policy.

(c)   When a Product or Printed Matter is acquired in Quebec through a transactional website:

(i)    From any person having added such Materials.

7.     Producers exempt from PFP

7.1  The Small Producers’ Policy sets out all the terms, conditions and criteria leading to a PFP payment exemption.

7.2  Voluntary Producers, as indicated in the Voluntary Producers' Policy, cannot be exempted from payment.

8.     Materials included, excluded or deductible from the Report

8.1  Producers are invited to consult the Materials Guide, available on ÉEQ’s website, which will guide them in the classification of the Materials included, excluded and deductible from the Report.

8.2  Essentially, the types of Materials to be reported are:

(a)   Containers and Packaging:

(i)    Made of flexible or rigid material such as paper, cardboard, plastic, glass or metal;

(ii)   Designed to contain, protect or wrap products;

(iii)  Intended for a single or short-term use;

(b)   Printed Matter, paper and other cellulosic fibres, whether or not used as a medium for text or images, except books with a useful life of more than five years;

(c)   Short-lived Containers and Packaging sold as Products, and Printed Matter sold as Products; and

(d)   Shipping Containers and Packaging used in the movement of products to the End Consumer, such as paper, cardboard, polystyrene cushioning packaging, or plastic film.

8.3  Materials to be excluded from the Report are:

(a)   Materials designed to accompany, protect or store a Product or Printed Matter throughout its lifetime, where such Product or Printed Matter is designed for a shelf life of 5 years or more;

(b)   Pallets designed to facilitate the shipping and handling of a number of sales units or grouped packaging, bags used to administer fluids or medications and bags used for force-feeding, syringes, with or without needles, and pressurized containers containing hazardous materials within the meaning of the Regulation respecting hazardous materials (CQLR c Q-2, r 32);

(c)   Containers and Packaging sold as products implicitly intended to contain or wrap materials other than those covered by the Regulation, such as household waste, organic matter and biomedical waste;

(d)   Materials generated by a Service or accompanying Products or Printed Matter intended only for use or consumption by an Ultimate Consumer on the premises where the product is distributed or sold, where such Materials are taken charge of on those same premises. Generally, without limitation, Materials accompanying food inside a restaurant are excluded, but not those accompanying drive-through orders or take-out food;

(e)   Materials for which the Ultimate Consumer is an industrial, commercial or institutional facility;

(f)    Books and documents of a didactic nature having a lifetime of more than 5 years; and

(g)   Printed Matter serving as personal identification documents, official documents or containing personal information, such as birth certificates, passports and medical charts.

8.4  Materials that may be deducted from the Report are:

                 (a)    Materials recovered during home delivery;

                 (b)    Returned Products that are part of a recall, that are expired, damaged, unable to be sold to an End Consumer or not distributed; and

                 (c)   Materials used or recovered in-house, not sold or not distributed and which are not otherwise covered by this Policy.

Every exclusion must be clearly described and justified in the ÉEQ Portal, otherwise the Materials shall be included in the Report.

9.     Terms and conditions related to the annual Report

9.1.  Every Producer must file its annual Report in the ÉEQ Portal not later than:

(a)   For the 2024-2025 Reporting Years: Not later than on the 60^th day following the effective date of the applicable Schedule of Contributions published under section 53.31.14 of the Environment Quality Act, CQLR c Q-2; and

(b)   For the 2026 and subsequent Reporting Years: Not later than May 31 of the Reporting Year.

9.2    The annual Report must include the following data and information:

(a)      The quantities of materials subject to a fee generated in kilograms during the Reference Year covered by that Report (for example, for the 2024 Report, the materials subject to a fee to be reported are those generated in 2023);

(b)      Description of the methodology supporting the reported data;

(c)      Description of the materials subject to a fee deducted from the annual Report and the number of kilograms or the percentage applied based on the materials subject to a fee;

(d)      The list of Names and Trademarks included in the Report, while identifying the status in respect of those Trademarks: owner, user, First Supplier, Retailer or transactional website operator;

9.3    In the case of Printed Matter, a Producer must include the list of Printed Matter it converted from a physical format during a Reference Year to a digital format it owns and offers throughout the Reference Year, if any, in order to document the Printed Matter reduction measures that have been implemented.

9.4    For every Material generated by a Product or Printed Matter put on the market in Quebec, the Producer must be able to specify, on request:

(a)   The Name or Trademark associated with it, if any; and

(b)   Its status in respect of the Product or Printed Matter, i.e., specify whether it is the owner, user, First Supplier, Retailer or operator of a transactional website through which the Product or Printed Matter was acquired.

9.5    The quantities of Materials that were generated must take into account the combined operations in Quebec at all of the points of sale, Establishments or businesses under the same Banner.

9.6    A Producer must keep and maintain up-to-date and accurate documentation, books, records and other data in support of its obligations under the Contract, the General Terms and Conditions, the Policies and the Regulation so as to justify the content of every Report, every credit request due to an eco-modulation measure and the amount of every PFP for a period of 5 years from the filing of its Report.

9.7    A Producer must notify ÉEQ promptly if it becomes aware that the information contained in the Report on the ÉEQ Portal is incorrect or incomplete.

9.8    Methodologies used to extract the data to be included in the Report:

(a)   ÉEQ encourages the use of actual data to prepare the Report.

(b)   The methodology used must be able to support the data entered in the ÉEQ Portal and show, in particular:

(i)    Product identification data, such as UPC (SKU);

(ii)   Description of each Product or Product group;

(iii)  Product format; and

(iv)  Weight and type of each component of the Product.

(c)   The studies carried out by the Producer or by a Producer association justifying the deductions applicable in Quebec.

9.9      The data reported will be used to prepare the Eco-modulated Financial Participation Schedule for the next Obligation Year and the billing of the resulting PFP, if any.

9.10   ÉEQ reserves the right to revise the Report at any time and issue a revised PFP invoice in accordance with the Audit Policy.

10    Time frame for requesting an amendment to the Report in accordance with the Audit Policy

10.1   Any Producer that believes it has grounds that could justify a revision of its Report shall have a period of 2 years following the submission due date of such Report. The admissible grounds are set out in the Audit Policy.

10.2   Upon receipt by ÉEQ of a notice of termination of membership sent by the Producer or upon expiry of the prior notice sent by ÉEQ for this purpose, as provided in section 9 of the General Terms and Conditions, a Producer shall have 30 days to deliver a Report amendment request. No amendment requests will be accepted after that time period.

10.3   All relevant documents and information enabling ÉEQ to proceed with a full analysis of the amendment request and render an informed decision must be submitted within the same time frame.

11   Eco-modulated Financial Participation Schedule and eco-modulation measures

11.1   The Eco-modulated Financial Participation Schedule and the eco-modulation measures:

(a)     Are considered to be a lever to promote circular economy, to meet the undertakings of ÉEQ and the Members described in the General Terms and Conditions, and to facilitate the achievement of the performance targets identified in the Regulation;

(b)     Are updated annually and appended to this Policy;

(c)     Will be presented to the Members for consultation prior to their final adoption by the board of directors, in accordance with the General Terms and Conditions; and

(d)     Must allow the financing of the costs of the System of Selective Collection and related expenses, as provided in the General Terms and Conditions.

11.2    Eco-modulated Financial Participation Schedule

(a)      Under the Contract, the General Terms and Conditions and the Regulation, the Eco-modulated Financial Participation Schedule is dynamic, in order to take into account, in particular, the following factors, as the data justifying the measures introduced gradually become available:

(i)       The recyclability of the Materials;

(ii)      The presence of outlets for the Materials;

(iii)     The incorporation of recycled materials in those Materials; and

(iv)     The reduction efforts at source in the manufacturing of those Materials.

(b)        The Eco-modulated Financial Participation Schedule contains a list of materials subject to a fee to be reported and the rates ÉEQ has set for each of these materials.

11.3    Eco-modulation measures

(a)     In accordance with the Contract and the General Terms and Conditions and with a view to extended producer responsibility, ÉEQ makes an effort to encourage the Producers to choose Materials that are compatible with selective collection or to dissuade them from choosing less compatible Materials by instituting eco-modulation measures in support of its Eco-modulated Financial Participation Schedule.

(b)     The eco-modulation measures are dynamic, and they are updated annually so as to keep up with developments in the Materials generated, the capacities of the System of Selective Collection to process and recycle the Materials, and the potential for introducing recycled content in the Materials with a view to a circular economy.

(c)     The eco-modulation measures are presented globally in an Eco-modulation roadmap, which is available on the ÉEQ website.

(d)     The eco-modulation measures that apply to a given Report are presented in an appendix to the Eco-modulated Financial Participation Schedule for that Obligation Year.

(e)     Producers eligible for credits and other eco-modulation measures are Producers that have:

(i)      Generated Materials in the Reference Year;

(ii)     Submitted a detailed Report, including a Small Producer that has chosen to make a detailed Report of its Materials, even if it is eligible for a simplified Report leading to a fixed PFP;

(iii)    Fully paid the PFP related to that Report, within the prescribed time frame, unless there was a prior written agreement with ÉEQ; and

(iv)   Transmitted the form and the information required for the credit or eco-modulation measure within the prescribed time frame.

(f)      Producers that are not eligible for credits or other eco-modulation measures are Producers that:

(i)    Are exempted from paying the PFP;

(ii)     Have availed themselves of a fixed PFP under the Small Producers’ Policy; or

(iii)    Have sent a notice of termination of membership to ÉEQ or have received a prior notice of termination from ÉEQ.

(g)     Eco-modulation measures may result in the granting of credits (bonus) or the charging of penalties (malus). Certain measures may be subject to an analysis prior to being validated by ÉEQ.

(i)    ÉEQ has the authority to review all requests for credits, bonuses and other eco-modulation measures and to request additional supporting documentation if necessary;

(ii)     Further to its analyses and reviews, ÉEQ has the authority to generate a full or partial credit or to grant no credit for the eco-modulation measure in question;

(iii)    Credits are granted by means of a separate invoice issued in the year following the deadline for submission of the Report;

(iv)   Credits resulting from an eco-modulation measure are applicable against the PFP for the following year; and

(v)    Penalties (malus) are applicable on the amount of the PFP for a given Obligation Year and are included in the billing for the Report.

12   Coming into force of the Eco-modulated Financial Participation Schedule and the eco-modulation measures

12.1    The Eco-modulated Financial Participation Schedule and the eco-modulation measures shall come into force following the adoption of the rates by ÉEQ’s board of directors.

12.2    Until such time as it is paid, any previous balance shall remain due and owing in accordance with the Eco-modulated Financial Participation Schedule for the Obligation Year applicable to it.

13   Determining the PFP

13.1 The amount of the PFP for a given Obligation Year is determined by:

(a)   Multiplying:

(i)    The quantity in kilograms of each of the materials subject to a fee generated during the Reference Year;

(ii)   By the rate applicable to each under the Eco-modulated Financial Participation Schedule for the Obligation Year,

(b)   The penalties (malus) resulting from eco-modulation measures for that Obligation Year are added to the amount owed, if any.

13.2    The credits resulting from an eco-modulation measure that are obtained by a Producer are applicable to the balance to be paid for the following Obligation Year.

14   Taxes applicable to the PFP

14.1    The taxes in force in Quebec under the Act respecting the Québec sales tax, CQLR c T-0.1 apply to the Producers’ Financial Participation.

15     Billing and payment of the annual PFP

15.1    Once the Eco-modulated Financial Participation Schedule comes into force, all Producers will receive an email with the invoice(s) for the PFP based on the information contained in the Report, with or without amendments, as applicable.

15.2    All annual or special PFP payments or instalments must be paid in full, by the due date, in the year following the Report, based on the following schedule and terms:

Payment schedule	Payment due dates
Quarterly payments of the annual PFP
1st payment due (25%)	January 31st yearly
2nd payment due (25%)	April 30th yearly
3rd payment due (25%)	July 31st yearly
4th payment due (25%)	October 31st yearly
Payment of the special PFP
Special PFP 2023	January 31st 2024
Special PFP 2024	October 31st 2024

 

15.3     All payments of the annual PFP must be made in the lawful currency of Canada.

15.4     Payments may be made by either:

(a)     Direct deposit (ÉEQ’s preferred method): ÉEQ’s banking details are available on every invoice issued. A written notice must be sent to recevables@eeq.ca. Failure to send such notice shall release ÉEQ from any liability for allocating the payment;

(b)     Credit card via the Moneris platform, available through the ÉEQ Portal if the total amount owing is less than $10,000; or

(c)     A cheque made to the order of Éco Entreprises Québec sent to 1600, René Lévesque Blvd. West, Suite 600, Montréal (Quebec) H3H 1P9. In the latter case, kindly allow enough time for mailing in order to meet the payment due dates and avoid charges being applied.

15.5     Any past due sums shall bear interest in accordance with the terms, conditions and rates listed in the Interest, Penalties and Sanctions Policy.

16   Reporting terms and conditions for new Members

16.1   Any Producer that commences operations in Québec shall submit a Report in the year following the year during which it began its operations. The time between such beginning of operations and December 31^st shall be the Reference Year for the purposes of the Report. The Producer shall comply with the terms, conditions and time periods set forth in this Policy.

16.2   As mentioned in the Contract, a Producer that becomes a Member retroactively shall submit all missing Reports, in addition to the Report for the current year, in the ÉEQ Portal. The Policies in force at that time and the Eco-modulated Financial Participation Schedules specific to each of the Obligation Years shall then apply. Charges and penalties shall also apply under the Interest, Penalties and Sanctions Policy.

17   Establishing a special PFP

17.1    ÉEQ reserves the right to request a special PFP in the following instances:

(a)    In order to meet all its obligations and assume its responsibilities under the Regulation, including, without limitation, the creation of a reserve fund;

(b)    Following an adjustment to a given Eco-modulated Financial Participation Schedule, due to significant changes in the System of Selective Collection or the context thereof.

17.2    If a special PFP is required, a special Eco-modulated Financial Participation Schedule will be developed to cover the necessary costs.

17.3    In accordance with the Contract and the General Terms and Conditions, the special Eco-modulated Financial Participation Schedule and the conditions justifying its implementation will be presented to the Producers for consultation.

17.4    Such special PFP will be payable in the time frame indicated on the invoice. However, the minimum time frame will be 30 days following receipt of the invoice.

17.5    Any past due sums shall bear interest in accordance with the terms, conditions and rates listed in the Interest, Penalties and Sanctions Policy.

18   Collection procedure for outstanding balances

18.1   Any balance outstanding on the PFP due date stipulated in this Policy shall be subject to collection measures up to and including legal recourses, as provided in the Interest, Penalties and Sanctions Policy.

18.2   The collection measures may be taken by ÉEQ or by a third party on behalf of ÉEQ.

19   Producers in default

19.1    Any Producer that is in default under the Contract, the General Terms and Conditions, the Regulation or this Policy must notify ÉEQ promptly if it becomes aware that the information contained in its Report is incorrect or incomplete.

19.2    Any Producer that is in default under the Contract, the General Terms and Conditions, the Regulation or this Policy shall incur charges, penalties or sanctions, in accordance with the Interest, Penalties and Sanctions Policy.

For any assistance understanding your obligations, preparing your Report, classifying materials or others, including the eco-modulation measures, do not hesitate to: Ø  Consult the tools and information made available to you on the ÉEQ website: •       Materials Guide •       Methodology sheets by activity sector •       Excel file for the classification of Materials   Ø  Contact a Company services agent who will be pleased to assist you: service@eeq.ca 514-987-1700 or 1-888 – 987-1491

 

 

Appendix 1

Eco-Modulated Financial Participation Schedule and Eco-Modulation Measures

Financial Participation Schedule

 

Applicable eco-modulation measures

1.     Post-consumer recycled content credit (PCRCC)

a)    A Producer that has generated Materials for which the post-consumer recycled content percentage reaches or surpasses the threshold presented below is eligible for a credit of 20% of the PFP payable for the Materials in question if the Report has been filed on time.

Materials eligible for a credit	PCRCC Thresholds 2023 FPS	PCRCC Thresholds 2024 FPS	PCRCC Thresholds 2025 FPS
·     Newsprint inserts and circulars	80%	80%	To be determined
·     Magazines, catalogues and publications	50%	50%	To be determined
·     Telephone books	80%	80%	To be determined
·     Paper for general use and other printed matter	80%	80%	To be determined
·     CP: Kraft paper shopping bags	100%	100%	To be determined
·     CP: Kraft paper packaging	100%	100%	To be determined
·     CP: Paper laminants	100%	100%	To be determined
·     CP: Polyethylene terephthalate (PET) bottles	100%	100%	To be determined
·     CP: High-density polyethylene (HDPE) bottles and containers < 5 L	100%	100%	To be determined
·     CP: PET containers	100%	100%	To be determined

 

2.     The supporting documents required to determine such post-consumer recycled content must be forwarded to ÉEQ 30 days following the Report due date. The ÉEQ application form available for this purpose must be completed and submitted on or before the Report due date.

3.     Eco-design incentive bonus

(a)   A bonus of up to 50% of the PFP payable for the Product Containers or Packaging concerned by an eco-design measure may be granted to an eligible Producer that has implemented an eco-design measure for Containers or Packaging and that demonstrates that its measure meets the requirements described on the ÉEQ website.

(b)   A Producer may submit a bonus request for several Products to ÉEQ. A separate request must be submitted by the Producer for each Container or Packaging concerned by an eco-design measure.

(c)   The form and the supporting documents needed to justify the request for an eco-design incentive bonus must be submitted to ÉEQ 60 days following the Report due date.

(d)   A Producer may obtain a credit of up to $25,000 per bonus request and may combine several credits up to a maximum of $60,000.

(e)   A minimum amount of $5,000 per Producer will be granted to any Producer whose single or multiple bonus requests are deemed admissible by ÉEQ. That minimum amount will be capped at the total amount of the PFP in the Reference Year if the PFP is less than $5,000.

(f)    The eco-design bonus is granted exclusively for the reported quantities of eco-designed Containers and Packaging put on the market in the Reference Year.

4.     Eco-modulation measure specific to newspapers

(a)   A Producer which, in the Reference Year, has put newspapers on the market having a total weight ≥ 15 metric tonnes, must demonstrate that, throughout the Reference Year, it has had and offered one or more digital products.

(b)   Otherwise, ÉEQ may invoice an amount corresponding to 1% of that Producer’s PFP as additional PFP (malus).