Design Delight Studio

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

Authors: Jonas Köster (Principal Associate), Tobias Klatt (Associate)
Co-Authors: Juliane Hilf (Partner), Sam Houshower (Counsel)
Date: October 21, 2025

Overview

The European Union is advancing environmental sustainability by implementing new Ecodesign rules targeting the destruction and auditing of unsold consumer products. These regulations are embedded within the EU Ecodesign Regulation for Sustainable Products (ESPR 2024/1781), focusing on transparency and banning the destruction of certain unsold goods, with significant implications for businesses operating within or outside the EU but targeting the EU market.

Key Regulatory Highlights

• Scope & Applicability:
  These rules apply to all consumer products placed on the EU market regardless of the company’s location. They primarily affect large enterprises first, with medium-sized businesses following by mid-2030. – Audited Transparency Requirements:
  Enterprises must annually disclose audited information covering:

  • Quantity and weight of unsold products discarded by category
  • Reasons for disposal, including any legally justified exceptions
  • Treatment methods like reuse, recycling, or disposal rates
  • Preventive measures planned to avoid unsold product destruction

  Disclosure must be accessible either via the company’s website or within sustainability reports compliant with the EU Accounting Directive (Articles 19a or 29a).

• Destruction Ban:
  Effective from July 19, 2026, a harmonized prohibition on the destruction of certain unsold consumer products takes effect. Exceptions will be clearly defined through a delegated act to avoid unintended consequences while ensuring resource conservation.

• Standardized Reporting Format & Verification:
  The EU Commission’s forthcoming implementing act (expected Q3 2025) will establish a standardized disclosure framework split into:

  1. Organizational details
  2. Product information with reasons for discard and waste treatment
  3. Preventive measures to mitigate future waste

  Companies publishing sustainability reports must secure limited assurance from auditors or accredited providers to verify disclosure accuracy.

Motivation & Market Impact

• Environmental Concern:
  The rapid rise of online retail has increased unsold product destruction, causing substantial environmental waste and economic loss. The EU views this as a growing problem necessitating uniform regulation.

• Market Harmonization:
  Existing diverse national regulations on unsold product destruction create market distortions. The new rules aim to harmonize practice across Member States, ensuring consistent legal expectations and enforcement.

• Penalties:
  Member States will define penalties for non-compliance, with Germany’s existing framework illustrating potential fines up to €50,000 per incident or more based on inferred profit impact.

Business Implications and Next Steps

• Immediate Preparation:
  Large enterprises should prepare for the audited disclosure obligations starting in 2026 (based on 2025 data), even before full acts are finalized.

• Strategic Compliance:
  Companies need to map product categories, quantify unsold stock accurately, and invest in measures reducing product waste, such as enhanced reuse or recycling systems.

• Legal Consultation:
  Businesses, especially those operating transnationally, should engage legal advisors to align operations with forthcoming EU rules and ensure transparent and verifiable reporting.

Conclusion

The EU’s new ecodesign rules underscore a strengthened commitment to environmental sustainability within the ESG framework by targeting unsold product destruction. By promoting transparency, imposing a destruction ban, and mandating audited reporting, these measures push enterprises towards more circular, resource-efficient business models, aligning economic activity with climate and sustainability goals.

For enterprises seeking detailed guidance on navigating these complex upcoming requirements, staying abreast of the final delegated and implementing acts expected by Q3 2025 will be crucial. Early compliance preparation offers strategic advantages in ensuring regulatory adherence and reinforcing brand sustainability credentials within the European market.

References:

• EU Ecodesign Regulation for Sustainable Products (EU) 2024/1781
• EU Accounting Directive 2013/34/EU
• Freshfields Bruckhaus Deringer LLP analysis (2025)

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