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

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

The European Union is strengthening its environmental, social, and governance (ESG) framework by introducing new rules under the EU Ecodesign Regulation for Sustainable Products (EU) 2024/1781, commonly known as ESPR. These rules aim to curb the destruction of unsold consumer products—a growing environmental challenge intensified by online sales expansion—and promote transparency and sustainability.

Key Objectives and Scope

• Prevent Systematic Destruction: ESPR targets the environmental harm caused by disposing of unsold consumer goods, emphasizing resource conservation.
• Uniform Market Rules: Current fragmentation in Member State laws creates market distortions; ESPR establishes a harmonized legal framework across the EU.
• Applicability: The rules apply to products placed on the EU market regardless of where the enterprise is located, affecting both EU-based and international companies.

Timeline and Compliance Deadlines

• ESPR entered into force on 18 July 2024.
• Audited disclosure of unsold product data begins in 2026, covering 2025 data.
• The ban on destruction of certain unsold products comes into effect on 19 July 2026.
• Disclosure obligations extend to medium-sized enterprises starting 19 July 2030.

New Transparency and Reporting Requirements (Article 24 ESPR)

Enterprises falling under EPSR must annually disclose detailed information concerning unsold products they dispose of, including:

• Quantity: Number and weight of unsold products discarded, categorized by product type.
• Reasons: Specific causes for discarding along with any applicable exemptions.
• Waste Treatment: Share of products prepared for reuse, recycling, recovery, or disposal.
• Prevention Efforts: Current and planned measures to reduce future destruction of unsold goods.

Disclosure Format and Verification

• Disclosure must be made on an easily accessible page on the enterprise website or within sustainability reports as per the EU Accounting Directive 2013/34/EU.
• Parent companies may provide consolidated disclosures covering subsidiaries.
• The EU Commission is finalizing a standardized reporting format to enable comparability, structured into product data, treatment methods, and prevention strategies.
• Enterprises required to publish sustainability reports must obtain limited assurance from statutory auditors or accredited providers to verify disclosed data.

Ban on Destruction and Exceptions (Article 25 ESPR)

The regulation prohibits the destruction of certain unsold consumer products, with justified exceptions detailed in delegated regulations to be adopted by Q3 2025. Member States will enforce penalties for non-compliance; for example, Germany’s prior Ecodesign Directive allowed fines up to EUR 50,000 per incident.

Practical Implications for Businesses

• Broad Reach: The rules target all businesses marketing consumer goods in the EU, irrespective of geographic location.
• Urgent Deadlines: Large enterprises need to prepare promptly for mandatory audited disclosures beginning in 2026.
• Compliance Costs and Legal Risks: Failure to adhere to transparency and destruction bans may result in significant penalties and reputational damage.
• Strategic Benefits: Companies proactively reducing destruction and increasing transparency align themselves with sustainability and circular economy principles, appealing to environmentally conscious consumers.

Conclusion

The EU’s new ESPR implementing rules embody a robust step toward enhancing sustainability in consumer product lifecycles. By mandating transparency and curbing the destructive disposal of unsold goods, the EU promotes environmental stewardship and a circular economy. Enterprises engaged in the EU market should closely monitor the finalization of these rules and prepare to comply with disclosure and destruction bans to secure both regulatory compliance and competitive advantage in the evolving sustainable product landscape.

References:

• EU Ecodesign Regulation for Sustainable Products (EU) 2024/1781
• Commission Recommendations 2003/361/EC
• EU Accounting Directive 2013/34/EU
• Freshfields Bruckhaus Deringer LLP analysis by Jonas Köster, Tobias Klatt, et al. (2025)

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