Ref.Ref. Ares(2021)4534463 - 13/07/2021 Ares(2018)2019372  - 16/04/2018 The Usage of Recycled Plastics Materials by Plastics Converters in Europe A qualitative European industry survey October 2017

2 The Usage of rPM by Plastics Converters in Europe EuPC is the leading EU-level trade association, based in Brussels, representing European plastics converters. Plastics converters use plastics raw materials to manufacture new products. EuPC now totals 46 European and national plastics converting industry associations; it represents more than 50,000 companies, producing over 50 million tonnes of plastic products every year. The European plastics converting industry makes a significant contribution to welfare in Europe by enabling innovation, creating quality of life for citizens and facilitating resource efficiency and climate protection. More than 1.6 million people are working in EU converting companies (mainly SMEs) to create a turnover in excess of €260 billion per year.

The Usage of rPM by Plastics Converters in Europe 3 Foreword The EU Commission is working on an EU plastics strategy which will be published towards the end of 2017 or in early 2018. This strategy will pave the way to develop more sustainable plastics production and consumption. One of its main objectives will be to further stimulate the use of recycled polymers by plastics converting companies. For this reason, EuPC decided during its General Assembly 2017 to carry out an EU-wide survey to get more extensive knowledge of the current and future use of recycled plastics materials (rPM) by converters. Michael Kundel It has to be said, that for the last decades, the EU legislation has been stimulating primarily the collection of plastics packaging waste and that other waste streams were only marginally impacted. Recycling (collection) targets will most likely double or even triple and EU member states will face a huge challenge to reach the new objectives. The industry will have to work harder together throughout the whole value chain to ensure that appropriate markets for rPM will be developed. These markets will have to be created simultaneously with quality product standards as well as quality collection and separation guidelines in order to ensure a constant flow Alexandre Dangis        of recycled polymers towards the plastics converting industry. However, currently, only a limited number of converting technologies is able to absorb larger quantities of recycled polymers and new technologies need to be found to support this future development. We therefore hope the EU Commission will set up an “Innovation Fund” to help converters find new technologies to use more recycled plastics. This survey is conducted at the right time, when legislation might be pushing for more use of recycled polymers and converters have to investigate possible future uses of these materials as alternatives to virgin polymers in products. What are the limits of using recycled polymers? Which markets and which technologies can absorb the growing volume of recycled polymers? Which requirements are needed to encourage the use of more recycled polymers? Is there a specific pricing mechanism or financial incentive to consider to stimulate more use? Do converters intend to purchase more recycled polymers in the future? What is driving the use of recycled polymers in Europe? All these qualitative questions and many more incontestably offer very interesting insights into a new circular economy for the plastics industry. It is not only about what legislators can do to stimulate growth of rPM usage, but also about the current and future technological developments in the plastics converting industry that will ensure a sustainable circular future to the plastics industry in Europe. Michael Kundel                                                Alexandre Dangis EuPC President                                             EuPC Managing Director

4 The Usage of rPM by Plastics Converters in Europe

The Usage of rPM by Plastics Converters in Europe              5 Content Foreword ......................................................................................................................... 3 Content ........................................................................................................................... 5 Executive Summary ......................................................................................................... 8 Objective of the EuPC Survey on the Usage of Recycled Plastics Materials (rPM) ....... 12 Results of the EuPC Study in Detail ............................................................................... 16 1. Participating Companies ..................................................................................... 16 2. Incentives for and Barriers to the Usage of rPM ................................................ 19 3. European and National Regulatory Aspects and Framework ............................. 25 4. Future Developments ......................................................................................... 27 Conclusions ................................................................................................................... 32 Contact .......................................................................................................................... 35

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The Usage of rPM by Plastics Converters in Europe 7 Double page executive summary 2 Executive Summary

8    The Usage of rPM by Plastics Converters in Europe Executive Summary The PCE survey on the use of recycled plastics materials (rPM) by plastics converting companies in Europe was conducted over a period of 5 months between Mai and September 2017. EuPC commissioned the survey to get a deeper insight into the challenges the European plastics converting industry is facing when it comes to the usage of rPM. The PCE survey was conducted at an important time, while the EU strategy on plastics is being drafted and legislation might soon be setting higher recycling targets. The plastics converting industry forms by far the biggest part of the plastics value chain, not only regarding the number of companies, but also regarding turnover and employment. Converting companies play a crucial role in the transition towards a more circular economy. The charts below show the allocation of employees, companies and turnover in the European plastics industry. Number of Employees                Number of Companies                        Turnover 30,000    140,000                      1000 2000                    2 Billion € 100 Billion € 2%         8%                         2%     4%                     0.55%         27.62% 1,600,000 - 90%                       50,000 - 94%                 260 Billion € - 71,82% Plastics Converters         Plastics Producers      Plastics Recyclers The participation of 485 respondents from 28 different countries ensures that the results give a representative image of the industry as a whole. The industry sample as well adequately represents the whole industry in products segments, with companies from all major sectors participating. The results shed light on the incentives for the use of rPM as well the barriers hindering its usage. Furthermore, the current legislative framework is assessed regarding its ability to support the use of rPM by converters, and an outlook on future developments is given.

The Usage of rPM by Plastics Converters in Europe   9 The following statements present the main results of the survey and draw first conclusions on the current state and the future developments of the European plastics converting industry: 1. Quality and steadiness of the supply show to be equally strong barriers to the use of rPM for plastics converting companies. The results of the study draw a negative image of the supply situation in Europe, as the majority of participants (almost 60%) finds it hard or very hard to find a satisfactory supply of rPM. 2. Price is the main incentive for converting companies to use rPM, while a better environmental image and a favourable carbon balance also play an important role. The results furthermore reveal that the requests of customers can be a decisive factor. The fact that they play this role for just 2% of the participants clearly shows that the customers of converting companies lack behind in the embracement of rPM. 3. When it comes to barriers to the use of rPM, quality as well as stability of the supply are the most important factors. Only 15% of the participants state that the price prevents them from using rPM. This indicates that the quantity of rPM on the market is not a problem, but its inferior quality. Legal issues are hindering the use of rPM as well, especially regarding food contact applications, where the European Commission has failed to establish a working system more than 9 years after the regulatory framework was adopted. The same applies for the legacy additives issues for long-life products, where converting companies are still facing legal uncertainty. 4. The attitude of the customers of the converting companies towards the use of rPM needs to be improved to increase the quantity of rPM processed by converters. Without the support of its customers, the plastics converting industry will not be able to boost the use of rPM. The first step to change that attitude would be an increase of awareness, which should in return lead to a better acceptance of rPM. More value chain collaborations with specifiers (e.g. architects) and brand owners are needed to achieve this. 5. The fact that a majority of almost 60% of the converting companies thinks that the current product regulations are not suitable to support a stronger use of rPM in the future shows that the regulatory framework needs to be adjusted. For example the introduction of quality standards would lead to more use of rPM by 41% of the participating companies. 6. The vast majority of European plastics converters is already using rPM, despite the numerous barriers. In the future, this number will further increase to more than 90%. This development however needs to be backed and could be further improved through the support of the customers of converters and adjustments of the legal framework. 7. The fact that the participants mostly consider only two converting processes to be able to incorporate a bigger use of rPM in the future shows that the number of technologies that are able to use large amounts of rPM currently is limited. More innovation is needed in order to find additional converting technologies to absorb the increasing amount of recycled polymers that is expected to arise in the future.

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