Should drinks producers sign up to Circularity Scotland's deposit return scheme, and what are the financial and operational risks?

Members overwhelmingly advise **against** joining Circularity Scotland at present. The scheme poses significant financial and logistical risks that outweigh any benefits for producers.

**Key concerns identified:**

- **Cross-border arbitrage risk** — Because Scottish-specific barcodes are logistically unmanageable, the scheme cannot prevent English products being brought into Scotland and redeemed for deposits. Members cited realistic scenarios where a producer forecasting 10,000 cans sold in Scotland could face liability for 100,000+ redeemed cans they never sold there, with the cost difference (e.g., £23k on 100,000 cans at 23p per can) unrecoverable from wholesalers who sold to English distributors instead.

- **Scottish wholesaler collapse risk** — The price differential caused by the scheme is expected to drive local Scottish wholesalers out of business, while English wholesalers and cross-border traders gain advantage. One member noted this creates perverse incentives for opportunistic collection and resale across the border.

- **No consumer demand yet** — Several members reported that retailers (e.g., Waitrose) are asking for producers' positions, but there is no indication that end consumers are driving adoption. Holding fire on enrollment until the deadline (end of February cited) is the consensus approach.

- **Enrollment fee and uncertainty** — Members are deferring payment of enrollment fees until the last moment, reflecting low confidence in the scheme's viability and fairness.

**Poll result:** 4 members voted "No, not planning to join"; 0 voted "Yes."

**Current status:** Some producers have completed mandatory initial filings but are not actively participating. The consensus is to wait and see whether customer demand (beyond retailer inquiries) materialises before committing financially.