A MULTI-million pound company which has a plant in Stourport is at the centre of a High Court dispute over what exactly constitutes "waste".

A judge's eventual ruling could make the difference between success or failure for Merseyside-based OSS Group Ltd, which employs around 150 people at plants in Stourport and Scotland.

The business has an annual turnover of £17million and says it could go under unless it wins its legal battle against the Environment Agency.

The case hinges on whether OSS's groundbreaking "Clean Fuel Oil" - which comes from recycled fuel oil and is used by several UK industries for burning - is a waste product or not.

Last December and again the following month, the Environment Agency said it was, and so was subject to far more stringent emission regulations.

Lawyers for OSS said the ruling undermined the company's entire business as its current focus on selling "recycled fuel oil" was becoming increasingly unviable.

Financial projections suggested clean fuel oil would bring revenue streams of between £40 million and £60 million to the group by 2008 and £3 million had already been spent on research and development and improvements at the Stourport site.

Barrister Stephen Tromans, for OSS, said on Wednesday last week that unless the Environment Agency's decision was overturned, OSS could go out of business.

In March, the company successfully applied for an injunction preventing the agency prosecuting anyone who used clean fuel oil in a non-waste capacity.

That order was under scrutiny last week, with a judicial review challenge brought by the OSS group poised to take place later this summer.

Mr Tromans, however, warned Sir Michael Harrison, hearing the case at London's High Court, the judicial review might be rendered obsolete should the injunction be lifted as the Environment Agency wanted.

Customers of OSS would get cold feet about using clean fuel oil, said the barrister and, if that was the case, financial collapse could be just weeks away.

Barrister John Howell QC, for the Environment Agency, said the March injunction was "unlawful"and "contrary" to the public interest because there could now be no regulation of potential damaging emissions.

Arguing OSS was keen to maintain the status quo because it had a "competitive advantage", as clean fuel oil was more efficient than competitors' products, he added the injunction had set an unwanted precedent.

Recognising the importance of the case, Sir Michael reserved his decision until a later, unspecified, date.