Drink companies win recycling challenge

COCA-COLA has won its Federal Court challenge to the Northern Territory's cash for containers recycling scheme.

In the Federal Court in Sydney on Monday, Justice John Griffiths found in favour of three major beverage companies which had applied for the NT scheme to be declared invalid so they wouldn't have to comply with it.

Coca-Cola Amatil, Schweppes Australia and Lion Pty Ltd took the case against the NT government over the scheme, which is similar to a long-running one in South Australia and involves a 10 cent deposit on drink purchases, refundable when the container is returned to a recycling agent.

Coca-Cola increased its drink prices in NT when the scheme was introduced a year ago, and said its prices would drop if it won the court case.

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NT looking to appeal recycling court loss

THE Northern Territory government is considering appealing a Federal Court judgment that found a cash for containers scheme is invalid.

Northern Territory Chief Minister Terry Mills says his government won't give up fighting to continue the recycling scheme.

"We are intending to appeal but of course we haven't seen the judgment in detail but it is our intention to fight this," Mr Mills said following the court decision on Monday.

"We will explore every option to see whether we can keep this scheme going in the Northern Territory."

He called on the beverage industry to continue operating the NT scheme on a voluntary basis for two months so that people who have collected cans will be able to get a refund.

Prices of cans and bottles in the NT, some of which rose when the cash for containers scheme was introduced, should immediately drop, Mr Mills said.

Federal Court Justice John Griffiths found the NT's scheme was in breach of the Commonwealth Mutual Recognition Act.

The NT government would lobby within the Council of Australian Governments (COAG) to get an exemption under that Act, Mr Mills said.

Alec Wagstaff, director of corporate affairs for Coca-Cola Amatil, said the judgment meant the company could immediately move to drop prices in the Northern Territory.

"This court case was never about stopping recycling in the Northern Territory," Mr Wagstaff told reporters outside court.

"This judgment was purely a legal issue about the conflict of laws between the Northern Territory and the Commonwealth."

Coca-Cola did not believe container deposits were the best way to improve recycling in Australia and would work with the government to find other ways, Mr Wagstaff added.

"They only address a small part of the problem and they're very expensive," he said.

"Now that the court has ruled the system doesn't effectively apply, we think it's really important the consumers don't suffer."

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NT recycling scheme 'breaches federal law'

THE Northern Territory's cash for containers recycling scheme runs counter to federal law by restricting drink sales, counsel for three beverage companies have told the Federal Court.

The court is considering an application in Sydney by Coca-Cola Amatil, Schweppes Australia and Lion Pty Ltd for the NT scheme to be declared invalid.

The companies oppose the scheme which involves a 10 cent deposit on drink purchases, refundable when the container is returned to a designated recycling agent.

Bret Walker, for the for the three drinks giants, told the court on Tuesday the scheme ran counter to the national Mutual Recognition Scheme governing the sale of goods between states and territories.

He said the scheme covered the packaging and labelling of goods and this was relevant to the need to specially label cans and bottles in the NT with a refund message.

Mr Walker said the Mutual Recognition Scheme aimed to avoid state or territory government laws that would "prevent or restrict the sale of goods" from another state or territory.

"There's a case that there's a prohibition, or a conditional prohibition ... it's a restriction of the sale of goods in the territory," he said.

Coca-Cola had to increase its drink prices in the territory when the scheme was introduced a year ago, and has said prices would be dropped if it won the court case.

The NT's Solicitor-General, Michael Grant QC, told the court the territory's scheme did not seek to prevent or restrict the sale of goods but only to limit environmental pollution and waste.

"It's a law regulating the sale of beverages in only one particular aspect ... concerned not with whether beverages can be sold but how they can be sold."

Mr Grant said the scheme did not impose any prohibition on the sale of beverages.

He said an aim of the Mutual Recognition Scheme was to ensure local and imported goods were treated equally within states and territories and that was the case in the NT's recycling scheme.

The hearing before Justice John Griffiths continues.

Justice Griffiths reserved his decision until a later date.

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