Vinyl Foundation Frequently Asked Questions

Why has the Vinyl Foundation been set up - and why now?

The European PVC industry has a duty to meet the targets set out in the 10-year Vinyl 2010 Voluntary Commitment. Vinyl 2010 was set up to address the whole lifecycle of PVC, so logically the whole value chain has an obligation to also financially support this initiative. The raw material producers contribute through their membership of ECVM, ESPA and ECPI. Some funding has been provided by the PVC converting industry to date, but this has been supporting application specific recycling schemes. The Vinyl Foundation has been set up to meet the growing need to support mixed PVC waste streams, where there is a shared responsibility; and to spread these costs more equitably across the whole PVC value chain.

What is Vinyl 2010?

Vinyl 2010 is the European PVC industry's Voluntary Commitment. Since 2000, Vinyl 2010 has been progressing the sustainable development of the PVC industry through a series of externally-audited targets. The programme has also been recognised by stakeholders internationally, and it has been registered with the Secretariat of the United Nations Commission on Sustainable Development.

Don't the converters already pay into Vinyl 2010?

Through their membership of ECVM, ESPA and ECPI, the raw materials producers have always contributed at least 70% of the funding towards the Voluntary Commitment. Some PVC converters do already contribute to Vinyl 2010 schemes but to date this has been supporting application specific recycling schemes. There is a growing need to support mixed PVC waste streams to be able to meet the targets the industry committed to. To achieve the 30% balance of funding required for this is a shared responsibility that needs to be spread equitably across the whole converting sector.

What is the difference between the Vinyl Foundation and Vinyl 2010?

The Vinyl Foundation has been incorporated as a Belgian legal entity based upon recent legislation (stichting) by the converting sector to collect its 30% funding obligation for Vinyl 2010. Recycling and sustainability activities will continue to be carried out by Vinyl 2010.

How will the Vinyl Foundation payment scheme work in practice?

European PVC resin producers will be requested to supply sales volume information to KPMG Fiduciaire, on behalf of the Vinyl Foundation through a secure and confidential system. KPMG Fiduciaire will then issue payment requests to the converters based on the tonnage of resin bought.

What is expected of converters?

Converters will be asked to contribute a small sum per tonne of PVC resin bought from the resin producers. Companies will receive a payment request from KPMG Fiduciaire, who have been retained by the Vinyl Foundation to administrate an independent and confidential payment scheme.

What is expected of the producers?

PVC resin producers will be requested to supply sales volume information to KPMG Fiduciaire, on behalf of the Vinyl Foundation through a secure and confidential system. Volume data will be broken down by standard ‘AC-Fiduciare' categories so that KPMG Fiduciaire will then be able to issue payment requests to the converters based on the tonnage of resin bought and its end-use application.
(The ‘AC-Fiduciare' categories are being used because these are the categories already used by the resin producers when reporting the volumes that are used to calculate overall industry production levels each year. This will ensure the standardisation of data across the industry.)

Is it legal for my resin supplier to give my purchase information to a third party?

The Vinyl Foundation operates in a similar way to may other many other industry systems for securely aggregating confidential data. The concept has been carefully verified by an external legal firm White & Case and the secure KPMG Fiduciaire system is bound by strict, legally binding confidentiality agreements.

How do we know that information supplied to KPMG Fiduciaire will remain confidential?

Resin producers will supply sales volumes to KPMG Fiduciaire as the administrators of the Vinyl Foundation payment system, who will then issue requests for payment. This information will be completely confidential and cannot be accessed even by the Trustees of the Vinyl Foundation, themselves converters.

How much will Vinyl Foundation contributions be?

Vinyl Foundation contributions for 2006 volumes have been set at 0.35 €/T for PVC used to produce rigid PVC products; 1.25 €/T for PVC used to produce flexible PVC products; and 1.00 €/T for PVC supplied to traders and compounders. Converters and compounders who produce products just for export can request an exemption from contributions for these volumes and the same applies to producers of PVC packaging (sheets), which already have an effective national collection and recycling scheme in place in the EU.

It is not cost-effective to issue payment requests based on volumes to converting businesses who purchase less than 300 tonnes of PVC resin per year because of the administration costs involved. However , these companies may still wish to make a contribution towards end-of-life recycling for their products and be recognised as a Vinyl 2010 partner, able to use the Vinyl 2010 logo in their marketing and appear on the Vinyl Foundation contributor list. If this is the case for your business they can and pay a fixed minimum fee. The SME fixed fee for 2008 has been set at €375

Why is there a difference between the contributions set for rigid and flexible applications?

Contribution levels have been set to reflect the funding requirements for recycling different types of PVC products where rigid PVC recycling required significantly less investment by the industry than for flexible applications.

Do I have to contribute to the scheme?

Payment of the payment requests that will be issued to all converters cannot be enforced, but all sectors of the PVC industry are strongly encouraged to contribute a relatively modest sum to ensure that we are able to meet the Vinyl 2010 commitments.

What will the tax and VAT implications of payments into the Vinyl Foundation be?

KPMG Fiduciaire have studied both the VAT and corporate tax implications of the Vinyl Foundation payment system. Contributions will be VAT exempt both between the converters and the Vinyl Foundation and the Vinyl Foundation and the projects which it funds. Contributions can be considered as tax deductible in most EU countries. KPMG Fiduciaire can be consulted to answer specific queries in this area.

Will Vinyl Foundation payments be ongoing annual charges?

Yes, commencing with a payment based on 2006 trading, the plan is for Vinyl Foundation payment requests to be sent out annually, at least until the Vinyl 2010 commitment is fulfilled in 2011 (2010 figures).

What will I get for contributing to the scheme?

Apart from sharing in the future of the industry by ensuring that it fulfils its obligations under the Vinyl 2010 Voluntary Commitment, all converters who pay into the Vinyl Foundation will be recognized as official Vinyl 2010 Partners and able to use the Vinyl 2010 Partner for Sustainability logo.

What will being a ‘Vinyl 2010 Partner for Sustainability' do for me?

Being a Vinyl 2010 Partner for Sustainability will show that your company is committed to sustainable development and will highlight the eco-efficiency of your PVC products. Converters can use the logo on their marketing materials, letterheads, business cards etc.

But beside a potential image benefit, what value will contributing to the Vinyl Foundation add for my business?

The Vinyl 2010 Voluntary Commitment is underpinning the sustainable development and political credibility of the whole European PVC industry, by transparently improving processes and closing the end of life PVC recycling loop. Contributions made via the Vinyl Foundation represent an investment in the long-term future of the European PVC industry.

I'm not in a trade association. Can I still become a Partner of Vinyl 2010?

All European converters who purchase resin from a European producer within the scheme will receive a payment request even if they are not part of one of the Vinyl 2010 associations. Payment of the request will entitle your business to be recognized as official Vinyl 2010 Partner.

As an EuPC member, I'm already contributing to Vinyl 2010 through my national/sectoral association. Am I going to have to pay "twice"?

The level of Vinyl Foundation contributions has been calculated to reflect contributions already being made to existing recycling schemes. This is the fairest way of sharing the costs across the converter sector.

This contribution per tonne is equal to a hidden tax. Won't this increase the likelihood of production outside the European market?

The contribution requested per tonne through the Vinyl Foundation is modest. If Vinyl 2010 fails to meet its obligations voluntarily, then based on the evidence of alternative mandatory recycling schemes that have been imposed across the EU, the cost to the industry in the long term would be far greater. The Vinyl Foundation trustees, themselves converters can see the importance of safeguarding the future of the European PVC industry and supporting a significantly more cost-efficient recycling system.

As a resin producer won't I lose customers if I ask for extra payment?

The payment request will come directly from KPMG Fiduciaire on behalf of the Vinyl Foundation based on the information provided by the PVC resin producers. In future converters should receive payment requests no matter which producer they purchase PVC resin from in Europe. The contributions requested from the converters will go towards supporting the sustainable development initiative Vinyl 2010, which is in the interests of the whole industry.

As a resin producer we supply a significant proportion of our resin through our own compounding operation internally and via a third party distribution company externally. How can Vinyl Foundation request for payments reach end-user converters in this instance?

The intention of the Vinyl Foundation system is to levy a contribution towards Vinyl 2010 recycling schemes from the whole value chain, and to provide end converters with the opportunity to use the Vinyl 2010 branding for the positive eco-marketing of their products. We recognize that the system will not be perfect in every circumstance and it may be desirable to adapt the basic process to meet the desired objective of the system. For example, in the situation described, ideally the resin producer and the intermediary (compounder/distributor) should cooperate to behave as co-suppliers:
1. jointly ensuring that all the end-user converters being supplied are written to
2. both signing confidentiality agreements so that and relevant customer details and tonnage information can be supplied jointly to KPMG Fiduciaire for all resin volumes supplied.
Thus the intermediary will effectively become invisible for the purposes of the Vinyl Foundation system and KPMG Fiduciaire will be able to process payment requests directly with the converters as intended by the system.