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

The European Union is advancing sustainable product regulations under the EU Ecodesign Regulation for Sustainable Products (ESPR) (EU 2024/1781), specifically focusing on unsold consumer goods. This regulatory update aims to enhance transparency and prevent the systematic destruction of unsold products — a significant environmental and economic concern driven partly by the rise of online sales.

Overview of ESPR and Its Scope

• Effective Since: 18 July 2024, with key obligations kicking in by 2026.
• Who Must Comply: All businesses placing products on the EU market, regardless of their geographic location.
• Focus: Large enterprises initially, with medium-sized enterprises following from 19 July 2030.
• Goal: Harmonize rules across member states to prevent market distortions and environmental harm caused by unsold product destruction.

Key Regulatory Developments

1. Destruction Ban
   From 19 July 2026, a ban on destroying certain unsold consumer products will apply, curtailing wasteful disposal practices.

2. Transparency and Disclosure (Article 24 ESPR)
   Enterprises must annually disclose detailed data on discarded unsold consumer products, including:

   • Quantity (number and weight) by product type/category.
   • Reasons for discarding and any applicable exceptions.
   • Treatment of waste (reuse, recycling, other recovery, disposal).
   • Preventive measures to reduce destruction.

3. Disclosures Format and Verification

   • Disclosure must be made public on a company website or within sustainability reports complying with the EU Accounting Directive (Articles 19a or 29a).
   • A standardized reporting format will be mandated to ensure comparability, covering organization details, product data, and prevention efforts.
   • Large enterprises must obtain a limited assurance opinion from auditors or accredited providers on the disclosed information.

4. Exceptions to the Destruction Ban (Article 25 ESPR)
   A delegated regulation will define justified derogations, clarifying when destruction may be permissible.

Implementation Timeline & Enforcement

• Draft implementing and delegated acts: Expected adoption by Q3 2025.
• Audited disclosure begins: 2026 (reporting on 2025 data).
• Ban on destruction starts: 19 July 2026.
• Medium-sized enterprises disclosure: From 19 July 2030.
• Member state penalties: Set at national level, for example, Germany can impose fines up to EUR 50,000 or more per incident.

Implications for Businesses

• Broadened accountability: Non-EU companies must comply if selling in the EU.
• Operational changes: Need for improved product lifecycle management, data collection, and sustainability reporting.
• Market impact: Level playing field in the EU with harmonized transparency and restrictions.
• Risk management: Penalties and reputational damage for non-compliance emphasize the importance of early adaptation.

Conclusion

The EU’s ESPR marks a significant step in embedding environmental responsibility in consumer product markets by targeting the treatment of unsold goods. Enterprises active in the EU will need to enhance transparency and implement sustainable practices swiftly to meet these new legal standards and support broader ESG goals.

Sources:

• EU Ecodesign Regulation for Sustainable Products (EU 2024/1781)
• Draft Commission implementing and delegated acts (Q3 2025)
• Freshfields Bruckhaus Deringer LLP analysis by Jonas Köster & Tobias Klatt (October 2025)

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