Symphony Environmental statement on the EU OXO legal case (FREE)

THE JUDGMENT

(1) the Judgment and ruling of the Court was as to whether the Defendants had acted within the limits of their discretion with regard to the amendment to the Directive. The claim was for compensation focussed on the legality of their conduct.

(2) The Court found that the Defendants had not exceeded the limits of their discretion, so compensation was not awarded to Symphony.

(3) This Judgment was not an assessment of the effectiveness of the d2w technologies. The Court took into account only the information that was available at the time the Directive was adopted and did not include further studies that have supported the d2w technology and the distinction between oxo-biodegradable and oxo-degradable plastics. Nor did it include any expert evidence for which the Claimants had paid, nor the opinion of the EU Chemicals Agency as to the formation of microplastics.

(4) The distinction of d2w from being captured under the Directive is supported by the opinion of Symphony’s King’s Counsel following the Judgment, and it is Symphony’s view in conjunction with that opinion that d2w should not be captured within the EU prohibition.

THE BUSINESS

d2w technology had not been widely used in the EU for several years, and the lengthy legal process and Judgment has therefore very little effect on Symphony’s existing business.

The Directors of Symphony believe that a key reason behind the lack of use of d2w in the EU is the wording of the amendment to Article 5 of the draft Directive inserted at a late stage in one of the committees of the European Parliament, which led to confusion in the market place with no distinction being made between oxo-degradable plastic and the oxo-biodegradable technology used in d2w.

Symphony was not able to change the wording of the Directive, which resulted in the Board finding it necessary to file a claim for compensation. In the Judgment, the Court has cited the CEN definition TR15351 which shows that oxo-degradable and oxo-biodegradable plastic are different materials. The Company will publish a detailed note on the Judgment next week, which will be available on its website.

OVERVIEW

The problem with plastic is that a lot of it gets into the open environment, where it creates persistent microplastics. Symphony had therefore developed a method of making plastic so that it converts into biodegradable materials and biodegrades much more quickly if it becomes litter at the end of its useful life. This technology (branded d2w®) has been in use around the world for the last 15 years, and is considered by Symphony to be the only way to prevent plastic which has escaped into the open environment from accumulating there for decades.

Symphony’s d2w and other approved brands are mandatory for a wide range of plastic products in Saudi Arabia, the United Arab Emirates, and other countries, who have carried out their own due-diligence on the technology, supported by robust international standards to prove biodegradability, recyclability, and non-toxicity. Symphony also sells d2w in many other markets around the world.

Commenting on the Judgment, Michael Laurier, CEO of Symphony said “We firmly believe that we were right to challenge this amendment to the draft Directive, and maintain that we should have received compensation for the confusion caused. We will continue our communications programme to explain the value of d2w biodegradable technology to protect the environment around the world from persistent plastic litter.

Symphony is heavily invested in a number of exciting territories around the world for our d2w and d2p technologies, and whilst it is frustrating that this Judgment makes it more challenging to sell d2w in the EU, the Group has a good pipeline of global opportunities for d2w, and we remain confident of communicating further progress in the coming months.”