The European Commission (EC) is undertaking an aggressive overhaul and expansion of the Ecodesign Directive to enable future regulation of the environmental sustainability of a wider range of products as part of a broader effort under of the European Green Deal. The proposed directive, called the Ecodesign for Sustainable Products Regulation (ESPR), would establish a new framework for product design, declaration and labeling requirements, while strengthening market surveillance efforts. As was the case under the existing directive, the Commission will be authorized to issue product-specific regulations as well as horizontal regulations covering several categories of products. Companies that manufacture, import, distribute or sell products in the European Union will face a number of important new requirements, including the need for all covered products to be equipped with a “digital product passport”. The Commission is also proposing a crackdown on the destruction of unsold products, as part of its broader effort to achieve a circular economy. While previous iterations of the Ecodesign Directive were limited first to energy-using products and then to energy-related products, the new Directive abandons these limitations, opening the door to regulation of a wide range of additional product categories.
The ESPR provides two categories of requirements: performance requirements and information requirements. Performance requirements are rules focused on products achieving a certain level of performance such as sustainability, energy efficiency, recyclability, environmental footprint and waste generation. Information requirements focus on product performance details and should be provided with the product, in labeling, manuals and/or product passports.
Digital Product Passports
Digital product passports are a new tool created by the directive to improve the end-to-end traceability of a product. The purpose of digital product passports – machine-readable digital codes accessed by scanning a data carrier – is to provide consumers with access to product information to help them make informed choices, enable repairers or recyclers access relevant information and improve the application.
The product-specific rules to be promulgated will designate the information that will be required in the product passport.
The ESPR extends the anti-circumvention language already in place under the existing Ecodesign Directive. These provisions are intended to prevent manufacturers and importers from marketing products designed to be able to detect that they are tested and likely to alter their performance when tested. ESPR’s anti-circumvention provision also prohibits software or firmware updates that degrade product performance once in market or in service without explicit user approval. Additionally, updates cannot make the product worse to the extent that the product becomes non-compliant with the test requirements. These provisions establish an ongoing obligation for regulated companies to ensure that products that were compliant when first introduced to the EU market remain so after firmware or software updates.
Under the existing Ecodesign Directive, certain product categories (eg imaging equipment) are self-regulated through a voluntary agreement between industry and other interested stakeholders and the European Commission. The new directive aims to encourage additional self-regulation, as long as it achieves the same objectives as mandatory regulations, while also imposing new reporting and monitoring requirements. Note that while the Commission seeks to encourage self-regulation, it has separately announced that the voluntary agreement on imaging equipment will not be extended and that such equipment will be subject to mandatory regulation in the future.
The ESPR establishes a group of experts, known as the Ecodesign Forum, made up of representatives of Member States and interested parties involved in a product group. The objective of the Forum is threefold:
- Define and review performance and information requirements,
- Review the effectiveness of established market surveillance mechanisms, and
- Evaluate self-regulatory measures.
In response to criticism that current market surveillance efforts are failing to deter non-compliance, the new directive would further strengthen and coordinate market surveillance efforts across member states.
Member States must submit plans every two years including the products or requirements identified as priorities and the market surveillance activities planned to reduce the non-compliance of these products or requirements. Given that market surveillance has so far been opaque and inconsistent across Member States, the new Directive would require each Member State’s plan to detail the number of checks to be carried out during the period covered by the action plan. The EC may, in future, impose a minimum number of checks that Member States must carry out. The EC will use the information provided by Member States to publish a report showing the number of checks carried out, the levels of non-compliance identified, and the nature and severity of penalties imposed over the previous two years.
The new directive aims to discourage and possibly prohibit the destruction of unsold goods. The directive will increase transparency by requiring large companies that dispose of unsold products to disclose the number of products they throw away each year, the reasons for their disposal and information on the quantity of discarded products they provided for preparation for reuse, reconditioning, recycling, energy recovery and disposal operations in accordance with the waste hierarchy. This information must be available on a freely accessible website or by other means. While small businesses are generally exempt from these requirements, the directive prohibits large businesses from selling to small businesses for destruction. Importantly, the directive allows the EC to outright prohibit the destruction of unsold goods in the future.
The Ecodesign Directive requires the Commission to set regulatory priorities through regularly updated rolling work plans which take stock of progress and include indicative priorities for new product groups related to energy to consider. The Ecodesign and Energy Labeling Work Plan 2022-2024 (work plan) was adopted by the EC on March 30, 2022. It focuses on energy-related products and defines priorities and planning future regulations. Once the Ecodesign for Sustainable Products Regulation has been adopted, energy-related products will be integrated into broader ESPR work plans.
As part of the work plan, the EC will launch exploratory studies on:
- Low temperature emitters,
- professional laundry appliances,
- professional dishwashers,
- Universal external power supplies (EPS) and
- Electric vehicle chargers.
The EC will prioritize products with the highest potential for energy and/or material efficiency, such as. The EC also plans to adopt regulations regarding eco-design requirements and an energy labeling system for tablets and phones by the end of 2022. The regulations will include energy efficiency and the efficiency of materials (durability, repairability, upgradability and recycling).