The private company behind a recycling scheme that left mountains of plastic stockpiled across the nation will be wound up, with Coles and Woolworths saying they'll clean up the mess.
The NSW Supreme Court has issued a wind-up order for RG Programs and Services Pty Ltd, putting another nail in the coffin of the REDcycle scheme that collected soft plastics at grocery stores.
Creditors, including one company that says it wasn't paid to store REDcycle plastic, will now be left to fight for what they're owed, with Benjamin Carson of Farnsworth Carson appointed liquidator.
Coles and Woolworths have done a deal with REDcycle to take back more than 12,000 tonnes of waste found at dozens of storage sites in NSW, Victoria and South Australia.
It's hoped recycling solutions can still be found and landfill won't be the final destination for the waste, which was dutifully collected and returned by environmentally conscious consumers.
"We're pleased this agreement will provide greater certainty that REDcycle's stockpiles will be responsibly managed for the best possible environmental outcome," the grocery chains said in a joint statement on Monday.
"We will be commencing work this week to address the current stockpile storage issues and conducting inspections of the REDcycle material over the coming weeks."
Both companies have said they had no idea the plastic was not being recycled. That changed in November when REDcycle said it was suspending operations and warehouses full of plastic began to be found.
AAP has sought comment from Liz Kasell, who founded the recycling scheme in 2011, served as its CEO, and is the sole shareholder of RG Programs and Services.
REDcycle has previously denied the stockpiling was a cover-up, saying it was an attempt to ride out problems including a spike in returned plastics, a fire at its largest taker of the material and insufficient recycling capabilities in Australia.
As partners in the scheme, Coles and Woolworths say they paid $20 million to REDcycle over a decade.
RG Programs and Services Pty Ltd is also facing three charges brought by Victoria's environmental watchdog, alleging it failed to reveal how much plastic it was holding, and where.
A roadmap is expected to be released later this week on next steps to resume a soft plastics recovery system in Australia.
