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

Introduction to the EU Ecodesign Regulation for Sustainable Products (ESPR)

The European Union is intensifying its commitments to sustainability with new regulations targeting the environmental impact of unsold consumer products. The EU Ecodesign Regulation for Sustainable Products (ESPR) (EU 2024/1781) introduces audited transparency requirements and a destruction ban affecting enterprises that market goods within the EU, regardless of their location.

Key Objectives and Scope

Aimed at curbing the widespread environmental harm caused by the routine destruction of unsold products, especially exacerbated by burgeoning online sales, the ESPR seeks to:

• Prevent systematic destruction of unsold consumer goods.
• Harmonize laws across EU Member States to avoid market distortions.
• Ensure all economic operators face consistent rules and incentives.

The regulation has been effective since 18 July 2024, but key provisions will apply following further delegated and implementing legislations expected by the third quarter of 2025. ## Crucial Upcoming Rules

The EU Commission is set to finalize two pivotal regulations:

1. Implementing Act on Disclosure Requirements (Article 24 ESPR)
2. Delegated Regulation on Exceptions to the Destruction Ban (Article 25 ESPR)

These set common formats for transparency and specify justified exceptions to the disposal ban. Member States will enforce penalties for non-compliance, with fines potentially reaching €50,000 or more per incident, as seen in Germany.

Detailed Disclosure Obligations (Article 24 ESPR)

Who Must Comply?

• Large enterprises: From 2026 on data from 2025.
• Medium-sized enterprises: Starting 19 July 2030.
• Applies to all products placed on the EU market, including imports.

Required Information

Enterprises must disclose annually:

• Quantity and weight of discarded unsold goods by product category.
• Reasons for disposal, including any applicable exceptions.
• Waste treatment methods used: reuse, recycling, recovery, or disposal.
• Measures taken or planned to prevent destruction.

Disclosure Format

Firms can publish this data either on an accessible section of their website or within sustainability reports mandatory under the EU Accounting Directive. Parent companies may consolidate reports covering subsidiaries.

Verification Requirements

Companies obligated to produce sustainability reports must acquire a limited assurance opinion from statutory auditors or accredited providers to verify the accuracy of disclosed information.

Practical Implications for Businesses

• Urgency: Deadlines to comply with disclosure and destruction bans approaches rapidly; preparations should start now.
• Global Impact: Non-EU businesses selling in the EU must adhere to these transparency and waste handling standards.
• Legal Compliance: Enterprises must monitor evolving delegated acts to align internal reporting and operational policies.
• Environmental Leadership: Beyond compliance, this initiative offers an opportunity to bolster brand reputation through demonstrable sustainable practices.

Conclusion

The new EU Ecodesign rules under ESPR mark a significant step toward embedding sustainability within product life cycles. By mandating transparency and prohibiting destruction of unsold goods, the EU aims to conserve invaluable resources and embed circular economy principles. Companies operating within or targeting the EU market should promptly align to these upcoming regulations to ensure compliance and support the global ESG agenda.

Sources

• EU Ecodesign Regulation for Sustainable Products (EU) 2024/1781
• Freshfields Bruckhaus Deringer LLP analysis by Jonas Köster, Tobias Klatt, Juliane Hilf, Sam Houshower
• EU Commission draft delegated and implementing acts (Q3 2025 drafts)
• EU Accounting Directive 2013/34/EU
• Commission Recommendation 2003/361/EC (definitions of enterprise size)

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