Germany's 'Green Dot' Waste Management System

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Case Details:

Case Code : BENV011
Case Length : 21 Pages
Period : 1990-2007
Pub Date : 2007
Teaching Note :Not Available
Organization : DSD GmbH
Industry : Services (Waste Management)
Countries : Germany

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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“Collecting and sorting garbage has become something like a national passion [in Germany].”¹

– Economics research group, IWD, in Cologne

“The green dot will not change, but we will be the first green dot organization that makes a profit.”²

– Helmut Schmitz, International Communications Director, DSD GmbH, in 2004

Introduction

In May 2007, the Court of First Instance³ at Brussels rejected the appeal made by Duales System Deutschland GmbH (DSD), the owner of the Green Dot trademark and Germany's largest waste management company, against the Court's April 2001 and September 2001 rulings that had found DSD guilty of abusing its monopoly position in the German waste management industry. The company was found to have charged very high fees from its customers and to have blocked competing firms from using waste collection facilities. DSD said it would “do without further legal steps in this process” and meet officials from the European Commission⁴ (EC) to settle the issue of the trademark fee (for its Green Dot symbol) and to verify whether the Commission would take any further legal steps.

DSD was set up as a not-for-profit organization in 1990 in anticipation of Germany's Packaging Ordinance. The ordinance was passed in 1991 to deal with the landfill crisis that Germany faced.

It placed the responsibility of collecting, separating, and reusing/recycling packaging waste on the producers/retailers. The producers, recognizing that it would be almost impossible for them to collect all the packaging waste that they generated, joined together to create DSD. DSD put in place what it called the Green Dot system, which licensed the use of the Green Dot trademark to producers who were its clients. Producers who paid a fee, determined by the material and weight of their packaging, were allowed to use the Green Dot on their packaging and only such packaging was collected and sorted by DSD.

The Green Dot system was initially hailed as a breakthrough in waste management. However, the system had several teething problems.

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1] John Schmid, “Germany's King of the Heap: A Recycler Fears Trashing of its Monopoly,” www.iht.com, July 15, 2002.

2] “Profits Warning: Why Germany's Green Dot is Selling up,” www.letsrecycle.com, November 25, 2004.

3] The Court of First Instance, set up in 1989, is made up of at least one judge from each member state of the EU (27 as of 2007). It is attached to the European Court of Justice and has jurisdiction to hear direct actions brought by legal/natural persons against European Community's institutions; actions brought by the member states against the Community; cases relating to Community trademarks, etc.

4] The European Commission, set up in the 1950s, is the executive arm of the European Union. It is independent of national governments and is responsible for representing and upholding the interests of the EU as a whole. It drafts proposals for new European laws, which it presents to the European Parliament and Council.