Multilayer plastic packaging is widely used in food and beverage applications due to its superior barrier properties, tensile strength and toughness, and material efficiency. However, it poses significant challenges to recycling because of its complex, multi-material structure and potential food contamination. Currently, most post-consumer BIB bags are sent to landfills, contributing to plastic pollution and broader environmental burdens. This study presents a life cycle assessment (LCA) of alternative mechanical recycling pathways for this waste stream, with the goal of identifying the most environmentally sustainable options. The findings of this study offer a critical perspective on the trade-offs between open- and closed-loop recycling for complex, food-contact multilayer plastics, supporting informed decision-making for advancing plastics circularity.