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

Introduction

The European Union (EU) is set to implement new ecodesign rules under the EU Ecodesign Regulation for Sustainable Products (ESPR) 2024/1781, aimed at stopping the systematic destruction of unsold consumer goods. These new measures introduce audited transparency requirements and a ban on destroying unsold products. The rules have significant implications for enterprises operating within or offering products to the EU market, both from inside and outside the EU.

Context and Objective

• The regulation addresses the environmental and economic loss caused by destruction of unsold consumer products, a practice growing rapidly alongside the rise of online sales.
• Existing disparate Member State laws have led to market distortions, prompting the EU to harmonize rules throughout Member States.
• ESPR came into force on 18 July 2024, but key provisions require implementing and delegated acts expected by Q3 2025 to come into full effect.

Key Elements of the New Rules

1. Scope and Applicability

• Applies to all products placed on the EU market, irrespective of the company’s location.
• Obligations initially focus on large enterprises, expanding to medium-sized enterprises by 19 July 2030 per EU standards.

2. Destruction Ban and Transparency

• Ban on destruction of unsold consumer products effective from 19 July 2026.
• Enterprises must annually disclose detailed data about unsold products they discard.

3. Disclosure Requirements (Article 24 ESPR)

Enterprises must publish information including:

• Quantity: Number and weight of discarded products, categorized by product type.
• Reasons: Reasons for discarding and applicable derogations.
• Waste Treatment: Breakdown of methods used such as reuse, recycling, recovery, or disposal.
• Prevention: Measures taken and planned to reduce destruction.

Disclosures must be available:

• On an easily accessible webpage or,
• Within the sustainability reports as defined by the EU Accounting Directive for certain companies.
• Parent companies may consolidate disclosures.

4. Format and Verification

• A standardized format will be mandated by the upcoming implementing act to ensure data comparability.
• Product categories will be classified based on the Combined Nomenclature codes.
• Enterprises with mandatory sustainability reporting must obtain a limited assurance opinion from auditors confirming data accuracy.

Enforcement and Penalties

• EU Member States are responsible for enforcing penalties.
• For example, in Germany, fines under the prior Ecodesign Directive could reach EUR 50,000 per violation, with potential increases tied to profits.

Practical Implications for Enterprises

• Companies offering products in the EU must prepare for detailed reporting obligations starting same-year data for 2026 disclosures.
• Businesses need to review and adapt sustainability strategies, data collection, and audit processes.
• An early proactive approach will mitigate compliance risks and position companies favorably in evolving ESG landscapes.

Conclusion

The EU’s new ecodesign rules represent a landmark step in integrating environmental sustainability into product lifecycle management. By preventing the destruction of unsold consumer goods and enforcing transparency coupled with stringent auditing, ESPR reinforces the EU’s commitment to sustainable consumption and production patterns. Enterprises involved in the EU market should closely monitor regulatory developments and align their operations well ahead of enforcement deadlines.

References:

• EU Ecodesign Regulation for Sustainable Products (2024/1781)
• EU Accounting Directive 2013/34/EU
• Freshfields Bruckhaus Deringer LLP analysis by Jonas Köster and Tobias Klatt, October 2025

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