The UK Government is set to block the deposit return scheme by refusing to grant a trading exemption for cans and bottles from outside Scotland, reports suggest.
The Scottish Sun understands the UK Government will reject the demands for an exemption to trading laws.
Sources claim this would fatally undermine the DRS, which is due to start on 16 August, and any move to go ahead would put Scottish businesses at a huge disadvantage.
However, Greens Cabinet Minister Lorna Slater has again said the scheme is “definitely going ahead”, but the Scottish Government needs an opt-out from the UK’s Internal Markets Act. The regulations could not be enforced for single-use packaged drinks from elsewhere in the UK without it.
Experts have also warned the initiative could create a trading barrier between Scotland and the rest of Britain — and contravene the UK’s Internal Markets Act, which was passed following Brexit.
The UK Government has confirmed to The Scottish Sun that no formal request for an Internal Markets Act exemption has been made by the Scottish government.
However, Slater told BBC’s The Sunday Show that UK Internal Markets Act exemption was “something we have been working through”.
Slater added: “We went through the exact same process last year with the ban on some of the most problematic single-use plastics.
“It is something that’s in process right now.”
Slater also hinted that smaller businesses may be given a one-year exemption from the scheme after a huge backlash from businesses.
A Scottish Government spokesman told The Scottish Sun: “We expect a decision from the UK Government as soon as possible. This is what is needed to give industry absolute clarity.”
In addition, the future of the DRS has also been placed in doubt after Kate Forbes – one of the contenders to succeed Nicola Sturgeon as leader of the SNP and First Minister - said she would “pause” the scheme’s rollout.
The Finance Secretary warned the initiative needed to be re-examined in the context of businesses who were overwhelmed by sharp rises in energy costs.
