Policy paper

Welsh Government deposit return scheme – UK Internal Market Act exclusion

Published 12 February 2026

Applies to Wales

The UK government is committed to ensuring a well-functioning UK internal market, underpinned by a framework that supports businesses to trade unencumbered by unnecessary costs and other barriers. This benefits both businesses and consumers across the UK, whilst respecting devolution and enabling the devolved governments in Scotland, Wales and Northern Ireland to design and implement policies that meet needs of people locally.

The Welsh Government has proposed an exclusion from the UK Internal Market (UKIM) Act’s market access principles through the Resources and Waste Common Framework. The exclusion has been considered following the processes set out in the review of the UKIM Act published in 2025. As set out in the review, the UK government has considered economic impacts, environmental protection and public health impacts, to ensure a balance of factors are considered. The UK government has engaged extensively with industry and environmental stakeholders to carefully consider the Welsh Government’s proposal.   

The UK government believes in the benefit of UK-wide deposit return schemes (DRSs) which are interoperable, with a common launch date to keep things simple for both businesses and consumers. The UK government recognises the very high recycling rates in Wales and the Welsh Government’s inclusion of glass bottles in their DRS, but also the feedback from industry about the impacts of divergence within the UK internal market and the need to have time to adapt.

The UK government has therefore offered an exclusion for single-use glass bottles in Wales, which will be implemented in legislation at the earliest opportunity. This exclusion is subject to the Welsh Government committing to all of these points:

• commencing its DRS for plastic and metal drinks containers as planned on 1 October 2027 
• ensuring that its DRS for plastic and metal drinks containers meets key criteria for integrating with a UK-wide scheme (this includes ensuring that schemes have a single registration and reporting system, processes for reciprocal takeback of material – for example, material can be returned in any nation, consistent logos and the same deposit level) 
• extending its proposed transitional period for single use glass (where a 0p deposit applies and no labelling requirements or targets apply) to October 2031 – this will provide industry with additional lead-in time to prepare for the introduction of glass in the Welsh DRS 

The UK government has also agreed to a proposal from the Welsh Government to establish a joint taskforce on implementation under the Resources and Waste Common Framework, including the devolved governments and the relevant deposit management organisations, in order to oversee interoperability and support the smooth implementation of DRS across the UK.

Supporting ambition on reuse 

The UK government intends to support the Welsh Government’s ambitions on reuse. The UK government is committed to working with both the Welsh Government and industry as Welsh Government develops its reuse policy and continues its leading role on recycling within the UK.

However, given the reuse policy in Wales is still under development, UK government has been unable to agree a UKIM Act exclusion for this part of the proposal. Any future exclusion request for reuse will be considered by the UK government and devolved governments in the relevant Common Framework as set out in the review of the UKIM Act in 2025.

The UK government is committed to transitioning to a circular economy, where reusable and refillable packaging systems are the norm. Reuse has an important role to play in ending the linear “take, make, throw” model, reducing carbon emissions, and easing pressure on natural capital. The UK government will continue further discussions with the devolved governments on the potential for alignment across the UK on reuse.