On June 3, 2025, the Resource Productivity and Recovery Authority ("RPRA"), the regulatory body who governs Ontario's extended producer responsibility ("EPR") programs under the Resource Recovery and Circular Economy Act (the "Act"), published two new draft guidance documents for consultation: Collection System Requirements Guidance and Minimum Management Requirements Guidance. This bulletin is Part 3 of our three-part series on proposed changes to Ontario's EPR regimes and provides an overview of the draft guidance and its impacts on producers and Producer Responsibility Organizations ("PROs") involved in the programs regulated by RPRA. This draft guidance comes at the same time as proposed amendments to the Act (read more in Part 1) and proposed amendments to the Blue Box regulation (read more in Part 2).
Public consultation on this draft guidance is open until July 18, 2025. Public consultation on the proposed amendments to the Act and Blue Box regulation is discussed in Part 1 and Part 2.
Background
The Act implements EPR in Ontario for producers supplying designated products to consumers that end up in the residential waste stream at their end of life. The Act also creates and governs the operation of RPRA. Regulations under the Act set out program requirements for the management, collection and recycling of designated materials, specifically the Blue Box, Batteries, Electrical and Electronic Equipment ("EEE"), Hazardous and Special Products ("HSP") and Tires programs.
The draft Collection System Requirements Guidance and Minimum Management Requirements Guidance discussed in this bulletin only applies to the Batteries, EEE, HSP and Tires programs and focus on clarifying collection system compliance requirements and providing guidance on meeting the minimum management requirements. Notably, RPRA also provides guidance on the purchase and sale of performance credits, which up to this point has resulted in an unregulated market as the Act and its regulations are silent on this topic.
Draft Collection System Requirements Guidance
The draft Collection System Requirements Guidance clarifies some of the requirements around establishing and operating collection systems under the Batteries, EEE, HSP and Tires programs.1 It focuses specifically on public collection systems, being the network of collection sites and activities across the province that allows consumers to discard or drop off designated materials. This additional guidance is intended to ensure accountability for setting up and managing collection systems while also demanding a more structured, proactive approach to system design and reporting.
Key clarifications provided for in the guidance include:
- Producers/PROs are required to have formal arrangements with collection site operators or registered service providers, who have their own arrangement with the collection operator, to ensure their systems meet public accessibility and regulatory requirements. When collection sites or activities are shared between producers/PROs, they must enter into sharing agreements, which both fosters collaboration between obligated parties and mandates proactive commercial and administrative arrangements to meet their respective regulatory requirements.2
- When collection sites or activities overlap between multiple producers/PROs, the draft guidance provides that sharing agreements are required and recommends features of such agreements. Producers/PROs in fully shared systems must register their "Shared Collection Systems" and confirm with RPRA that there is a sharing agreement in place. With respect to partially shared collection systems, producers/PROs must submit plans to RPRA to address the overlap, which may include confirming the sharing agreement in place or reporting on additional independent collection sites and activities to meet their collection site requirements.3
In all instances, producers/PROs must maintain accurate and up-to-date records and be prepared to produce evidence of their required sharing arrangements, upon request by RPRA.
Draft Minimum Management Requirements Guidance
Under Ontario's EPR regime, producers are required to collect and manage a certain amount of designated material they have supplied, either through their own systems or through the use of PROs, referred to as their minimum management requirements. The draft Minimum Management Requirements Guidance clarifies when and how producers/PROs can meet their minimum management requirements and provides guidance around buying and selling "recovered weight" as "performance credits" within the Batteries, EEE, HSP and Tires programs. This guidance defines "recovered weight" as the amount of designated materials collected and processed by a producer/PRO during a performance period under the respective program regulation and defines "performance credits" as the verified recovered weight that can be bought and sold between producers/PROs to meet minimum management requirements set by the respective program regulation.4
While Producers/PROs are encouraged to have agreements with registered service providers for collection and management of recovered weight in place ahead of the performance period, RPRA will only recognize recovered weight that was "transferred through an agreement with a service provider before or within the performance period". The language in the draft guidance is unclear as to whether this means that the agreement must be in place before or within the performance period or if the recovered weight can only be transferred before or within the performance period. We assume the former is intended by RPRA, as the latter would result in allowing recovered weight to be counted outside of the performance period, which does not align with any of the program regulations under the Act. This will hopefully be clarified in the final version of the guidance.5
Minimum Management Requirement Shortfall & Surplus
The guidance also suggests that if producers/PROs anticipate a shortfall in meeting their minimum management requirement, they should (1) monitor progress regularly throughout the year, (2) improve recycling efficiency and expand or enhance collection networks, (3) collaborate with other producers/PROs to share collection sites or recovered weight, or (4) purchase performance credits to cover any deficits. After the performance period ends, however, the only option to make up for a minimum management requirement shortfall is to purchase performance credits from other producers/PROs with a surplus of recovered weight before the annual reporting deadline for that performance period expires.6
RPRA does have two exceptions it will consider on a case-by-case basis where it may allow recovered weight or performance credits to count towards a minimum management requirement after the annual reporting deadline, being when: (1) newly registered producers must come into compliance with regulations, or (2) adjustments to supply reporting are required.7
Where producers/PROs have surplus recovered weight, they can sell them as performance credits to other producers/PROs with a shortfall. They can also adjust their public collection system to avoid significant surplus in the future, which may be completed by increasing sharing of collection sites or re-evaluating the need to continue collecting from private sites. Interestingly, the draft guidance warns producers/PROs about the potential for competition related concerns associated with the purchase and sale of performance credits and suggests seeking competition law advice in establishing these agreements.8
Audit & Verification Process
The guidance provides that recovered weight must be audited in accordance with the applicable verification and audit procedure set out in the applicable regulation and must be completed at the latest two weeks after the annual reporting deadline for the performance period. The guidance strangely provides that this audit should (but is not required) to confirm: (1) the designated materials were collected during the performance period from collection sites in Ontario, (2) processed materials were recovered according to applicable regulatory requirements; and (3) agreements between service providers and producers/PROs were entered into prior to or within the performance period.9
Similarly, performance credits will also need to be verified by an accredited third party (whose qualifications are designated in the draft guidance) in accordance with the Canadian Standard on Regulated Services (CSRS 4400), or equivalent standard, to ensure there is an agreement in place for the transfer of the performance credits at the latest two weeks after the annual reporting deadline for the performance period. Again, rather than create mandatory requirements for these agreements, the guidance strangely provides that this agreement should acknowledge that the recovered weight will be reported by each party plus or minus the performance credits purchased or sold and should allow for a third party audit of these performance credits to ensure they are not counted more than once.10
The guidance also encourages, but does not require, agreements for purchase/sale of performance credits to be entered into before or during the performance period and to set out a methodology for pricing and verifying the performance credits.11
Key Takeaways
This guidance directly affects how producers and PROs claim and account for collected and managed designated materials in meeting their management requirements and intends to ground the currently unregulated performance credit market in published RPRA guidance. It is therefore notable where RPRA chooses to make suggestions or encourage behaviour in the guidance rather than establish a mandatory requirement. Without clear rules on what is and is not required, particularly where it comes to verification of performance credits, producers/PROs may face challenges in navigating the performance credit market.
This guidance is intended to help producers/PROs prepare for and manage their recovery obligations while supporting transparent and verifiable reporting. Stakeholders may seek further clarification on or changes to the draft guidance by making submissions to RPRA while the consultation period remains open.
Footnotes
1. Collection System Requirements Guidance, pg.1.
2. ibid, at 4-5.
3. ibid, at 5-7.
4. Minimum Management Requirements Guidance, at 4.[5] ibid, at 4-5.
6. ibid, at 5-6.
7. ibid, at 6-7
8. ibid, pg. 5-6.
9. ibid, at 7
10. ibid, at 7
11. ibid, at 5.
The foregoing provides only an overview and does not constitute legal advice. Readers are cautioned against making any decisions based on this material alone. Rather, specific legal advice should be obtained.
© McMillan LLP 2025
