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Waves Coffee fined $31,000 over failed recycling plan

New Westminster-based coffee house chain penalized for recycling failures at its 21 locations across B.C.
Kareem Adli, 23, works as a barista at a franchised Waves Coffee House in Port Coquitlam, B.C. - Stefan Labbé/Tri-City News

The B.C. coffee chain Waves Coffee has been slapped with a nearly $31,000 administrative penalty for a “major” breach of provincial recycling regulations linked to the disposal of “to go option hot cups.”

The penalties from the Ministry of the Environment and Climate Change Strategy span March 29 to Nov. 30, 2023, and were handed to the 21-franchise coffee shop for using, selling and distributing paper products without plans to take responsibility for the life cycle of the products. 

In her June 19 decision, Environmental Management Act director Stephanie Little found the failures to comply with regulations led to “undermining the basic integrity of the B.C. recycling regulatory regime.”

“It also undermined the ministry’s capacity to protect and conserve the natural environment,” she added. 

Recycling plans form the foundation of the recycling regulatory regime and apply to companies that have a gross annual revenue of over $1,000,000 and produce more than one metric tonne of packaging and paper products.

By not having a recycling plan, companies “avoid their obligation" and create "an uneven playing field,” forcing those who are compliant to pay for their waste, according to Little. If a producer of packaging and paper products fails to pay its fees to fund recycling, it results in a “lack of recycling service to some or all B.C. residents.”

“This could negatively impact recycling rates and the waste stream, resulting in environmental impact,” she added.

Company generally 'non-cooperative'

Waves Coffee was given an opportunity to submit its side of the story in March 2024, and after repeated delays sent data on “to go option hot cups” sold at all of its locations in 2023. 

The company was also found to have been aware of its non-compliance since at least 2020 and was warned in March 2023. 

Little said she was persuaded that Waves Coffee “failed to take action” and increased the $10,000 base penalty by 25 per cent. 

“Waves Coffee has a history of failing to respond to the ministry, refusing to provide information, and generally being non-cooperative,” reads the initial penalty assessment form. 

“I find Waves Coffee to have had significant awareness of the requirement to appoint a stewardship agency or get a plan approved, and the control to come into compliance was firmly within their power. They have chosen not to.”

In its submission, owner Kayvan Rahmati said his name has been associated with Waves Coffee since in inception, but that he officially assumed ownership and operational responsibilities of the company on March 6, 2022, after the sudden passing of his father in a car crash. 

Rahmati said he had “limited involvement” in the company’s operations before that point.  

“I understand the need to take responsibility for the use of my name, but the circumstances surrounding its usage were beyond my control,” he is quoted saying in the decision. 

But after reviewing the evidence documented by ministry staff, Little found “no evidence was provided to support this assertion” and that “Kayvan Rahmati has been in contact with the ministry since 2019 regarding this matter.”

Little upped the base penalty another 20 per cent.

Company's paper cup sales questioned

The initial penalty assessment made its calculations estimating each location used about 500 disposable cups per day — something the company claimed was a “considerable overestimate.”

Data the company provided to the ministry appeared to show extremely low sales of paper cups at four locations, including one in Port Moody that reported selling 39 hot to-go cups for all of 2023. 

When asked about the extremely low numbers, Waves replied that it believed "there was a technical error."

"This raises concerns of the validity of the evidence provided,” wrote Little in her decision.

The director penalized the company another nearly $14,000, down from initial $56,900 assessment, for the economic benefit it gained over not having a recycling plan. 

In its initial assessment, total penalties recommended for Waves Coffee for its breaches totalled $73,900. That was reduced to $40,000 due to regulatory guidelines. 

The final penalty was again dropped down to $30,891 after downgrading how much economic benefit the company received for its environmental breaches. 

Waves Coffee has 30 days to pay the fee and reserves the right to appeal the decision.