Producer financial participation: Building the future of curbside recycling
Producers are legally required to pay a financial participation fee for the containers, packaging, and printed paper they put on the market each year. These payments are an essential part of the curbside recycling system.
We understand that recycling fees are putting financial pressure on some of our members.
Here's some important information to give some context.
How does Producer Financial Participation (PFP) work?
Under the Quebec government regulation based on extended producer responsibility, Quebec producers are legally required to report every year the quantities of materials they marketed the previous year. Their contributions are then used to finance the following year’s operating costs in real time,through quarterly payments.
Who sets the terms?
As the organization in charge of Quebec’s curbside recycling system, we apply the regulation introduced by the government of Quebec.We draw up the contribution schedules in accordance with the fee-setting formula and collect the payments.
Contribution schedules are drafted annually by Éco Entreprises Québec and approved by its Board of Directors. They are based on several factors, including the actual cost of the material in the system and its level of recyclability. ÉEQ provides producers with a Materials Guide to help you categorize them.
The PFP policy is included in the membership contractual structure you sign wih us as a producer.
The PFP represents around 80% of the total cost of the system, while the remainder is paid out of revenues generated by the resale of the materials, among other things.
Where does the money go?
We manage it on your behalf to pay for the following:
The transport of material within municipalities.
Sorting activities, including equipment upgrades.
Recovery of some problematic packaging.
Information, awareness, and education activities, such as our public-facing Bin Impact initiative.
The gradual expansion of curbside recycling services to multi-unit buildings and remote communities.
Future obligations in terms of outdoor public spaces and service to institutions, commerce, and industries (IC&I).
What is it?
The compensation plan, which came into effect in 2005, is based on the retroactive financing method. Payments made under the plan are used to compensate municipalities for the curbside recycling costs incurred the year prior to the reporting year.
The Schedule of Contributions sets out the rate, or fee, per kilogram of materials put on the market. It is used to calculate the total contribution producers must pay.
Who sets the terms?
We develop the fee structure and terms in collaboration with producers, then submit a draft Schedule to the Quebec government for approval. Once approved, the Schedule is implemented for the reporting year.
We collect your contributions and pay them to the government (RECYC-QUÉBEC), on your behalf. RECYC-QUÉBEC is responsible for distributing the funds to municipalities.
A necessary transition period
The compensation plan and Extended producer responsibility (EPR)will overlap until 2026. In 2025, we are required to compensate municipalities for curbside recycling costs incurred in 2024 and cover the full cost of the system in 2025.
This transition period means that companies will have to pay for two years at once (2024 and 2025). This is one of the factors behind the increase in the amounts payable this year.
Other factors that play a role:
Cumulative inflation over the past few years, which has increased collection, transportation, and sorting costs throughout the region.
Cost to maintain existing service levels and add new responsibilities.
Upgrade costs for sorting equipment
The investment required to take over an underfunded, 30-year-old collection system.
The government’s decision to postpone the expansion of the deposit system to include multilayer cardboard and glass ready-to-drink containers
How much is the PFP increase?
The average increase in PFP invoices is around 76% compared with the previous year. Around 1% of companies have to absorb an increase of over 100%.
Small companies with a place of business in Quebec that make less than $1.3 million in revenues or generate less than one metric tonne of marketed materials are still exempt from PFP payments.
What is being done to help businesses absorb this increase?
At Éco Entreprises Québec, we understand producers' concerns over the increase in financial contributions to curbside recycling, especially for small businesses.
Some mitigation measures have already been put in place:
Installment payments are possible through an individual agreement.
Deferral of the payment of the 2025 fee: invoices for the 2025 Schedule of Contributions will not be sent to producers until RECYC-QUÉBEC has provided information on the net costs to be paid to municipal organizations for 2024.
ÉEQ is actively considering additional measures.
What we have asked the government to do:
Create a temporary, government-administered, interest-free loan program to support producers equitably during the transition to EPR.
Postpone the new EPR regulatory obligations to 2030 and beyond.
You will receive three types of invoices:
Invoice type
Time frame
Annual contribution invoices for the 2025 SoC Provided for in the Schedule under the compensation plan
Issuance to be determined based on discussions with the government
Two special PFP invoices Provided for under Éco Entreprises Québec's policies
Issued only after submission of your 2023 and 2024 reports
Four invoices, each representing a quarterly installment for the 2025 annual PFP Provided for under Éco Entreprises Québec policies
All issued simultaneously as of fall 2024
Important note: These invoices are also payable by companies filing their first report. They will be required to file reports retroactively.
What happens after the transition?
All that remains is the annual PFP, payable in equal quarterly installments. You will receive one invoice per installment, or four invoices per year.
*Companies eligible for a flat fee will receive a single invoice, and payment will be made in a single installment. ÉEQ is looking into the possibility of offering payment installments for small producers as well. More information will be provided shortly.
Do you have any questions or concerns about the transition?
Join our monthly Q&A sessions to get answers and share your thoughts with our team. Go to the Tools & Resources section of our site to read transcripts from past sessions.