Court Rejects Biffa’s £51.4m Claim Over Scottish Deposit Return Scheme

On 16 January 2026, the Court of Session dismissed a compensation claim brought by Biffa against the Scottish Government concerning the failed deposit return scheme.

Biffa had sought approximately £51.4 million, citing losses after the cancellation of the scheme, which was intended to improve recycling through bottle returns. The company had previously secured a ten-year logistics contract for the initiative in July 2022.

Lord Sandison ruled that the Scottish Government did not owe Biffa a duty of care and found no breach of duty, rejecting Biffa’s argument of negligent misrepresentation. The court’s decision followed the shelving of the scheme in June 2023, after the UK Government declined to grant an exemption under the Internal Market Act, which prevented the inclusion of glass bottles.

Biffa had invested substantial funds in preparation for the deposit return scheme, anticipating future profits over the contract’s duration. The company’s expectations for the scheme were based on a projected ten-year operational period.

What the numbers show

• Biffa invested about £51.4 million in the scheme
• The company expected £114.8 million in profits over ten years
• The logistics contract was awarded in July 2022

The deposit return scheme was halted after the UK Government’s decision not to grant an exemption, which directly affected the scope of the planned recycling program. The inability to include glass bottles was cited as a key factor in the scheme’s cancellation.

Biffa’s claim for compensation was based on investments made and anticipated profits that would have been generated if the contract had proceeded as planned. The court’s dismissal of the claim concluded that the Scottish Government had not provided assurances that would give rise to liability.

Industry reaction

Biffa stated it is reviewing its position with legal advisers following the court’s decision. The company has not indicated any further legal steps at this stage.

The court’s ruling brings closure to the compensation dispute between Biffa and the Scottish Government regarding the deposit return scheme. The decision follows a series of procedural developments since the scheme was first announced and later cancelled.

* This article is based on publicly available information at the time of writing.