Welcome to our monthly quick fire round up of the Retail and Consumer sector's legal and market developments that should be on your radar this May. This edition features:
Extended Producer Responsibility (EPR) levies and mitigation strategies in Europe
The Extended Producer Responsibility (EPR) levy is a fee imposed by private eco-organisms on manufacturers and retailers to fund waste management, with costs rising particularly for basic plastics due to increased recycling investments. Disputes often arise over the classification of packaging and the fairness of fees, which are also contributing to inflationary pressures for retailers and manufacturers.
In France, manufacturers have successfully challenged high eco tax levels by arguing, under competition law, that eco-organisms abused their dominant position where bioplastic bags were unfairly treated as regular plastics, leading to a negotiated reduction in fees. This legal strategy highlights the potential for using competition law to secure fairer eco tax treatment.
In Spain, the EPR framework imposes a double burden on food and drink producers. EPR has also been extended beyond household packaging to cover commercial and industrial packaging, significantly broadening its scope. Similarly, the definition of producer is broad and producers established outside Spain must appoint an authorised representative.
Unlike France, there is no competition law basis in Spain by which to challenge high eco tax levies. Instead, although the legislation primarily appoints liability to the party placing the product on the market, it permits contractual arrangements to allocate financial, organisational, and reporting obligations down the supply chain. In practice, this has made contractual structuring a key mitigation tool.
In all European markets, eco tax levies like EPR are increasing and increasingly being reflected in pricing structures. Our experts are already helping producers with mitigation strategies: contact Michael Cousin (France) Samuel Martinez (Spain) and Rachel MacLeod (UK) to discuss the issue in their respective markets.
Mythos - the cybersecurity threat continues to increase making risk assessments paramount
Anthropic’s new AI tool Mythos represents a major step change in the impact of AI on cybersecurity, with the ability to autonomously identify and exploit vulnerabilities in IT systems at pace and at scale. While Mythos is not currently widely available, UK government bodies warn that similar AI-enabled cyberattack tools could soon be accessible to hackers worldwide, posing significant risks to all businesses, especially those who are heavily reliant on online operations. The rapid evolution of AI means threats are becoming more sophisticated, faster to deploy and therefore potentially harder to defend against, so it is essential for businesses to regularly review and refresh their cyber defences and focus on resilience, prioritising recovery of critical functions and minimising downtime after an attack.
You can read more about AI and Cybersecurity here.
Ban on upwards only rent review in business tenancies
Retail occupiers will find their lease negotiations changing in anticipation of the ban on upwards only rent reviews coming into force (England and Wales only). On the face of it, the ban could in part help to ease some of the cost pressures facing retailers by helping to ensure greater certainty in planning for future property costs arising from rent reviews. However, it remains to be seen exactly how the property industry will respond to the proposed changes. One consequence could be to drive up starting rents or it might see a move to more rent reviews being inflation-linked rather than the more traditional open market reviews. Read more about this decision here.
Contact Joe Maitland to discuss.
Selective distribution systems and UK competition law: the Court of Appeal’s final word in Up & Running v Deckers
The Court of Appeal has overturned the Competition Appeal Tribunal’s judgment in Deckers v Up & Running, confirming that HOKA (Deckers Limited) did not act anticompetitively by preventing a selective distributor from selling discounted stock via an anonymous website. The ruling provides valuable clarity on what constitutes a “restriction by object” under competition law, emphasising that economic context must always be considered and that the mere possibility of anticompetitive purpose is insufficient. Crucially, the court’s analysis of the vertical agreements block exemption confirms that not every restriction which might indirectly affect price is unlawful resale price maintenance. This decision reinforces legal certainty around selective distribution and vertical agreements, allowing businesses to structure commercial relationships with confidence while avoiding unnecessary competition law risk.
Contact Rona Bar-Isaac and Geoff Steward to discuss.
Recent OFSI enforcement against Apple
OFSI recently fined Apple’s Irish subsidiary £390,000 for breaching UK sanctions against Russia, despite operating outside the UK. This enforcement demonstrates OFSI’s strategic shift: even minimal UK connections, such as using UK financial institutions for payments, can trigger UK sanctions jurisdiction, and omissions, like failing to cancel a payment, are now treated as sanctionable conduct. For Retail & Consumer clients, this signals that any cross-border activity involving UK banks or payment platforms could expose them to UK sanctions risk, regardless of their location. It is essential to review and update compliance frameworks to reflect OFSI’s broader reach and heightened enforcement stance.
Contact India Barlow to discuss.
Don't miss out on: Reputational crisis simulation event in Leeds
Join us on Wednesday 3rd June at AG Leeds and experience the challenge of a live reputation crisis and strengthen your organisation’s readiness for the future.
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