The ‘E’ of ESG: New EU Ecodesign Rules for Unsold Consumer Products

Introduction to EU Sustainable Product Regulations

The European Union is advancing its commitment to environmental sustainability through new rules under the EU Ecodesign Regulation for Sustainable Products (EU) 2024/1781 (ESPR). These regulations focus on preventing the systematic destruction of unsold consumer products, addressing both environmental concerns and economic resource conservation. Introduced on 18 July 2024, the ESPR provisions require businesses to comply with transparency and destruction bans designed to harmonize market practices across Member States.

Scope and Applicability

The new rules apply to all products placed on the EU market regardless of where the business is located—inside or outside the EU. This wide reach ensures that any enterprise selling consumer products within the EU must adhere to these regulations.

Key Deadlines

• 2026: Audited disclosure obligations commence for large enterprises, based on 2025 data.
• 19 July 2026: Ban on destruction of certain unsold consumer products enters into force.
• 19 July 2030: Medium-sized enterprises also become subject to disclosure obligations.

Objectives of the ESPR Rules

• Reduce environmental harm caused by destroying unsold products.
• Harmonize legislation across Member States, preventing distortion in the internal market.
• Ensure transparency through audited disclosures tracking discarded products and preventive measures.
• Promote circularity by encouraging reuse, recycling, and recovery of unsold goods.

Disclosure Requirements under Article 24 ESPR

Enterprises must disclose annually detailed information on unsold consumer products they dispose of, including:

• Quantity: Number and weight of unsold products discarded, categorized by product type.
• Reasons: Justifications for discarding products, including any granted derogations.
• Waste Treatment: Proportions of products prepared for reuse, recycling, recovery, or disposal.
• Prevention Measures: Actions taken or planned to prevent destruction of unsold products.

Reporting Format and Verification

• Information must be published either on a dedicated, easily accessible webpage or included in mandatory sustainability reports per the EU Accounting Directive 2013/34/EU.
• Enterprises with sustainability reporting obligations must obtain limited assurance from auditors to verify reported data.
• A standardized reporting format outlined in the draft implementing acts will facilitate comparability across enterprises.
• Parent companies may consolidate reporting on behalf of subsidiaries.

The Destruction Ban and Exceptions

Alongside transparency, the ESPR enforces a ban on the destruction of certain unsold consumer products starting 19 July 2026. The EU Commission is finalizing delegated acts detailing:

• Exceptions to the destruction ban, allowing for justified derogations to accommodate specific situations.
• National penalties enforced by Member States for non-compliance; for instance, Germany’s penalties can reach up to EUR 50,000 per incident.

Next Steps and Implementation Timeline

• The EU Commission targets Q3 2025 for finalizing the implementing act detailing disclosure requirements and the delegated regulation on exceptions.
• Businesses should prepare for upcoming compliance including establishing systems for data collection, auditing, and transparent reporting.
• Enterprises operating both in and outside the EU must monitor these regulations closely, as non-compliance may lead to legal and financial consequences.

Conclusion: Strengthening ESG through Product Sustainability

The new EU Ecodesign rules under the ESPR mark a significant development in corporate environmental responsibility, focusing on sustainable product management and waste reduction in line with ESG principles. By enforcing transparency and discouraging destructive disposal methods, the EU aims to create a circular economy that benefits businesses, consumers, and the planet alike.

References

• EU Ecodesign Regulation for Sustainable Products (EU) 2024/1781 (ESPR)
• Draft Implementing Acts and Delegated Acts (EU Commission, 2025)
• EU Accounting Directive 2013/34/EU
• Freshfields Bruckhaus Deringer, "The ‘E’ of ESG: Sustainable products – new EU Ecodesign rules for unsold consumer products," 2025

For enterprises committed to sustainability and future-proof compliance, understanding and integrating these upcoming EU rules is essential. Stay informed to lead in the era of sustainable products.

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