Deposit return schemes — what retailers need to know by 2027

From 1 October 2027, the UK will introduce new deposit return schemes (DRS) for drinks containers under:

• The Deposit Scheme for Drinks Containers (England and Northern Ireland) Regulations 2025.
• The Deposit Return Scheme for Drinks Containers (Wales) Regulations 2026.

These schemes form part of a wider effort to reduce litter and improve recycling and will affect most businesses selling drinks in single-use containers.

Hetal Patel, national president of the Federation of Independent Retailers said: “This will provide customers with a positive nudge to return their bottles and cans so they can be recycled, reducing waste.”

Here, Claudia Sivori from our specialist retail sector team explores the key changes and outlines the practical steps that retailers need to take ahead of 2027. 

What’s changing?

Under the new rules, customers will pay a small refundable deposit when they buy drinks in certain containers.

They can then reclaim that deposit by returning the empty container to a participating return point, such as a shop or reverse vending machine. 

The schemes are expected to go live from 1 October 2027. 

Which containers are covered?

• England and Northern Ireland: plastic with polyethylene terephthalate (PET), aluminium and steel drinks containers between 150ml and 3L. 
• Wales: the above materials plus glass bottles, with a phased introduction for glass. 

This difference is important for retailers operating across borders.

What do retailers need to do?

The introduction of DRS will bring a range of new responsibilities for retailers. While the detail may vary depending on the size and type of business, some of the key obligations are outlined below.

1. Add the deposit at the point of sale

Retailers must pay the deposit to producers and wholesalers when purchasing the in-scope drinks and then apply the deposit to consumers at the point of sale. 

Consumers are expected to pay a 20p deposit when purchasing eligible drinks and receive it back when containers are returned for recycling.

2. Register with the scheme administrator

Businesses will need to engage with the Deposit Management Organisation (DMO) that was set up in April this year to run the scheme and oversee compliance. 

3. Meet labelling & reporting requirements

Retailers must make sure that in-scope products:

1. come from registered producers
2. carry the correct DRS labelling.

They’ll also need to comply with reporting requirements set by the scheme, including data on the number of products placed on the market or handled through the scheme.

Exchange for Change (EfC) — the not-for-profit, industry-led organisation — has been appointed to design and deliver the UK’s Deposit Return Scheme (DRS) across England, Scotland and Northern Ireland. From 1 October 2027, use of the scheme logo in line with the published guidance will be mandatory for producers across the UK in order to remain compliant with DRS regulations.

The logo will help consumers to recognise drinks containers that are included in the DRS when it’s launched.

Wales’ decision to include glass has introduced some complexities. The industry has voiced concerns to the Senedd Committees to highlight how the scheme could be susceptible to fraud without a UK-wide barcode system to return your glass items. 

However, the motion was agreed on 24 March 2026 by the Senedd. While glass drinks containers will be part of the scheme and collected from the outset, there’ll be a transition period during which glass drinks containers will be exempt from labelling and carry a zero‑pence deposit but can still be collected at return points. 

4. Accept returns (in some cases)

Many retailers — particularly larger stores — will be required to act as return points, accepting empty containers from consumers and facilitating the refund process. The deposit can then be returned via voucher, card or cash. 

Information must also be displayed so that consumers understand how the scheme works. 

Some smaller retailers may be able to apply for exemptions but qualification will depend on size, location and local return provision.

Alongside widening the scope of exemptions, EfC has confirmed a £60m funding initiative aimed at supporting the installation of reverse vending machines in advance of the scheme’s 2027 introduction.

Under the programme, up to 10,000 small, independent retailers across England, Scotland and Northern Ireland may qualify for grants of up to £6,000 per location.

Where drinks are sold for consumption on the premises, the business may operate a ‘closed loop’ model, meaning that it isn’t required to act as a return point for customers and can instead manage containers internally. This doesn’t mean that businesses are able to opt out of the DRS entirely. Rather, it remains within the scheme. 

In practice, this means that the business collects and stores empty containers on-site and arranges for their collection through the scheme — and the DMO oversees this process. 

A separate issue is whether the deposit is passed on to the customer. In most on‑premises settings, the deposit isn’t charged, as the container remains on-site and there’s no mechanism for the customer to return it. However, if a business does choose to charge the deposit, the standard principle still applies: the deposit is repaid to whoever returns the container.

Accordingly, where the premises retains and returns the containers itself, it’s the business — not the customer — that’s reimbursed once those containers are processed through the system. 

What does this mean in practice? Five key considerations

For retailers, DRS isn’t just a pricing change — it’ll affect day-to-day operations. 

Key considerations include:

1. Pricing updates to incorporate the deposit.
2. Store layout changes, particularly where returns must be handled.
3. Staff training, including managing returns and customer queries.
4. Logistics and storage, especially for returned containers.
5. Cross-border complexity, given the differences between the Welsh and English schemes.

More broadly, DRS forms part of a wider shift towards placing greater responsibility on businesses for the lifecycle of packaging and encouraging higher levels of recycling and reuse.

The enforcement authorities for the DRS are the Environment Agency and Trading Standards in England and the Northern Ireland Environment Agency in Northern Ireland. They will be responsible for ensuring that obligated suppliers and the deposit management organisation are compliant with the regulations.

Looking ahead 

The schemes introduce new compliance requirements and operational responsibilities, particularly around returns and reporting. Early planning will be important to ensure that businesses are ready ahead of the 2027 launch and to minimise disruption when the schemes go live.

Talk to us

If you’re unsure how the new regulations apply to you or where to start with preparation, now is the right time to seek advice. 

Our retail sector and regulatory specialists help food and drink businesses with gap analysis, documentation, training and ongoing compliance support.

Talk to us by calling 0333 004 4488, emailing hello@brabners.com or filling in our contact form.