Canada: Green Wall Of China Disrupts Waste Trade, Spurs Waste Policy Reform

On January 16, 2018, the European Commission unveiled the European Strategy for Plastics in a Circular Economy (the "Strategy"). The Strategy responds to a redirection in global waste trade and management spurred by China's ban on certain types of imported waste (the "Ban"). The Ban, implemented in December 31, 2017, is part of China's 'Operation Green Fence', which aims to crack down on an China's recycling industry, which has been criticized for causing environmental and human health issues in the country.

In 2016, China imported about 51 percent of the world's plastic waste, a global trade pattern that allowed (mostly) developed nations to divert their waste and bolster civic revenues. Like Europe, which shipped more than 85 percent of its plastic waste to China, Canada's federal, provincial and municipal governments will have to explore short-term (new trading partners and diversion streams) and more long-term action (policy reform towards waste reduction, waste management, and sustainable materials use) to address its growing waste management problem.

The Strategy

The Strategy, which provides a useful framework for potential Canadian legal and policy reforms, includes four ambitious and collaborative goals:

  1. improvement in the economics and quality of plastics recycling;
  2. curbing plastic waste and littering;
  3. driving investment and innovation towards circular solutions; and
  4. harnessing global action.

The Strategy includes a kaleidoscope of legal and non-legal implementation measures including:

  • regulatory schemes respecting:
    • packaging and labelling of biodegradable and plant-based plastic materials;
    • single-use plastics;
    • marine litter; and
    • microplastics;
  • extended producer responsibility schemes;
  • taxation; and
  • funding and awareness programs.

Short-Term Impacts: Growth in Resin Exports

The Ban's disruption of global waste trade has created a vacuum on both ends of the plastics supply chain. China's switch away from recycled inputs to virgin resin has increased virgin resin's demand, and price, benefiting resin manufacturers and exporters.

Though virgin resin may be a short-term stopgap for the supply vacuum created by the Ban, the world's growing global supply of waste plastics is likely to spur significant longer-term shifts in both demand and supply, including innovations in and changes to the recycling, bioplastics, and zero-waste manufacturing and retail industries.

China's refusal to continue to be a dumping ground for foreign waste is a global call to action for other jurisdictions to implement legal and policy reform to address the rapidly growing over-supply of waste plastics.

Canadian Reform

In Canada, municipalities lead the way with waste management reform, the City of Vancouver's Single-Use Item Reduction Strategy, the Checkout Bag Regulation Bylaw in Victoria, contemplated reduction strategies in Halifax, and many other municipal initiatives in smaller communities.

Although, provincial, federal, and international efforts have been at the discussion stage, decisive and coordinated action has lagged. Canada's national food policy, which is currently in consultation, is likely to address issues around food packaging waste, which makes up a significant portion of Canada's plastic waste. Whilst strategies are typically non-binding policy guides, they often lead to corresponding legal reform in pursuit of a strategy's aims (e.g., regulation, taxation, and financial incentives are currently under consideration by the City of Vancouver).

Companies operating in the plastics supply chain, waste management, and sustainable manufacturing and retail industries should remain cognizant of the challenges and opportunities posed by impending reform and the growing social policy movement towards zero-waste. Bennett Jones will continue to monitor legal developments in this area.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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