S. Korean food companies discouraged by burden of plastic cup deposit policy

South Korean food and beverage manufacturers are complaining about the government’s upcoming policy requiring them to pay a deposit for using a designated number of disposable plastic cups as it imposes the cost on the companies only.

Companies will be required to seek and pay a deposit with the Container Deposit System Management Organization (COSMO) for the number of label stickers equal to the number of plastic cups they will use.

The COSMO label must be attached to plastic cups before they can be sold. Each drink will have an additional 300 won added to it to cover the deposit.

The problem lies in a serious cost burden if the companies have a significant number of cups that remain unused.

Many businesses are unsure if they will be able to timely reclaim their deposits, including interest.

Companies have also expressed concern that the new regulation will impose unknown additional costs on them, including those for labor and facility to clean and store plastic cups returned by the customers are solely borne by the companies themselves.

The cost of distribution, which involves receiving the stickers at the corporate headquarters and distributing them to local stores, will also be significant.