This impact story is part of a series to celebrate the extraordinary pro bono projects undertaken by legal teams to support NGOs and social enterprises with the support of TrustLaw. All projects mentioned in this series are nominated for this year’s TrustLaw Awards. Find out more.
According to the Solid Waste and Circular Economy Hub, more than 40% of the Latin American and Caribbean (LAC) region’s municipal solid waste is sent to inadequate landfills, burned or left in bodies of water 45% of is disposed of in sanitary landfills (many of them without active biogas capture systems) and only 4% reused. Only two out of every 100 cities in the LAC region have formal recycling programs. This is creating an unprecedented environmental crisis. Although there have been significant technological advancements in the region to help reduce carbon emissions, recover materials from waste and extend the lifespan of landfills, their implementation is still in its early stages.
Grassroots recycling organisations, worker-owned entities that collect, transport, separate, and sell recyclable materials, such as cardboard, paper, glass, plastic, and metal, have emerged to try and plug the gap. However, these organisations face numerous obstacles. Their work often requires operating in harsh and unhealthy settings like streets and open-air garbage disposal sites, where they are exposed to hazardous substances that pose risks to their health. Concurrently, they can face social stigma and are perceived negatively by society and law enforcement agencies. Their earnings are unstable and depend on intermediaries in the supply chain, who earn the largest share of the profits.
Giving grassroots recyclers the tools they need
The public and private sectors, as well as civil society, all have a vested interest in improving conditions for grassroots recyclers but have historically not worked together effectively. That was until the launch of the ‘Regional Initiative for Inclusive Recycling’ (RIIR) in 2011, a partnership that combined some of the region’s largest private sector firms, including Coca-Cola and PepsiCo, with the Inter-American Development Bank’s Water and Sanitation Division. The partnership aimed to provide grassroots recyclers with the tools, professional skills and sectoral knowledge they needed to integrate fully into the solid waste management industry. RIRR was renamed as Latitud R in 2020, and two new regional partners joined the platform after that. Dow in 2020 and Nestlé in 2021.
Fundación Avina, a philanthropic foundation driving sustainable development in Latin America, is a founding partner of the RIIR and has been supporting the initiative since its inception in 2011. They have been working with grassroots recyclers to provide technical and financial aid.
Boosting legal understanding
As Latitud R expanded into new jurisdictions, Fundacion Avina increasingly came up against a lack of legal knowledge and understanding from many of the organisations they were supporting. They approached TrustLaw for support and were connected with two leading law firms in Consortium Legal in Guatemala and Perez Bustamente y Ponce in Ecuador.
The firms were able to provide comprehensive guidance on navigating the legal and regulatory requirements placed upon ventures that boost the demand for recyclable materials by innovative solutions in their jurisdictions related to the reimbursable cooperation agreements, including tax implications needed for this type of investment, explaining the scope of the provisions to the beneficiaries as well as the agreement´s legal enforceability, identifying the resulting tax liabilities at a local level, and improving each of the agreements subscribed to carry out these initiatives.
“With specialised legal advice from firms in Guatemala and Ecuador, we have perfected our Cooperation Agreements to offer financial aid at a lower market rate. This allowed us to promote innovative solutions regarding the transformation of solid waste, the circular economy and innovation in recycling, encouraging impact investment in line with the legal framework in force in Guatemala and Ecuador” said Santiago Mazzeo at Fundación Avina.
