The aim of the collar is to inhibit your magical powers (Source).
To change that, you should go toCamp Kitchen.
NearAmyro’scage, there is a path down into theArena of the One.
After a short conversation, you will get to the arena proper.
After you win, you will be brought to the pedestal and you will be able to return toNebora.
There, you get to meetLeya, who can remove the collars from the other members of your team.
Do not do this, until she learns what happened toGareth(see theMost Dangerous When Corneredquest).
After completing this quest return toLeya.
Then, she will remove the collars from all your team members.
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