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The products we use every day have a profound impact on the environment. In the European Union (EU), consumer habits are a major contributor to climate change and pollution.
Here’s another interesting way to look at it: how many Earths does a country need to meet its residents’ demand on nature? For example, we would need 2.8 Earths to meet Spain’s demands, 2.9 to meet Portugal’s and 3.0 to meet Germany’s.
To address this, the EU has introduced the Ecodesign for Sustainable Products Regulation (ESPR), which is a key part of the Circular Economy Action Plan; EU’s strategy to promote more environmentally sustainable and circular products.
Lately, we are seeing more regulations aimed at increasing sustainability, such as the EUDR, which regulates deforestation-free products; the CSRD, which requires companies to report on sustainability; and the CBAM, which introduces a carbon border adjustment mechanism to prevent carbon leakage.
The ESPR replaces the Ecodesign Directive 2009/125/EC and establishes a framework for setting ecodesign requirements across most product categories: it aims to enhance product durability, reusability, upgradability, and reparability; boost energy and resource efficiency; address substances hindering circularity; increase recycled content; and simplify remanufacturing and recycling. Additionally, it sets rules on carbon and environmental footprints and improves access to sustainability information.
Moreover, it aims to protect our planet, promote sustainable business practices, and bolster the competitiveness and resilience of the EU economy.
In case of non-compliance with the regulation, the Member State concerned shall implement all necessary measures to restrict or prohibit the product being made available on the market, or ensure it is recalled or removed from sale.
This Regulation applies to all physical goods placed on the market or put into service, including components and intermediate products. However, it excludes:
For a product to be sustainable, it must have one or more of these traits: use less energy, last longer, be easily repaired, have parts that are easily disassembled and repurposed, contain fewer harmful substances, be easily recycled, include more recycled content and have a lower carbon & environmental footprint over its lifecycle.
The regulation also introduces innovative measures such as a digital product passport, mandatory green public procurement requirements, and a framework to prevent the destruction of unsold consumer products.
By July 19, 2026, the Commission will establish a secure digital registry to store (at least) the unique identifiers. Additionally, the Commission will create and manage a publicly accessible web portal that allows stakeholders to search for and compare data within digital product passports.
The information requirements of the digital product passport shall ensure that products can only be placed on the market or made available for use if a DPP is provided. The data contained within the digital product passport must be accurate, complete and up to date. It must link to a persistent, unique product identifier via a data carrier —The data carrier must be physically present on the product, its packaging or accompanying documentation.
Additionally, the economic operator marketing the product must provide dealers and online marketplaces with a digital copy of the data carrier or unique product identifier, ensuring potential customers can access it.
The Green Public Procurement policy focuses on how contracting authorities and entities buy products and services: they must award public contracts in line with Directive 2014/24/EU or Directive 2014/25/EU, ensuring that these contracts meet the minimum requirements for purchasing products covered by the ESPR, as well as works or services that use these products.
These minimum requirements (that will be set by the Commission) are designed to encourage the supply and demand of environmentally sustainable products, considering the value and volume of public contracts and the economic feasibility of acquiring such products without disproportionate costs.
Economic operators are required to take all reasonable measures to prevent the destruction of unsold consumer products. Those who discard unsold consumer products, either directly or through a third party, must disclose specific information. This includes:
Fortunately, recycling is becoming increasingly popular, and major companies are adding dedicated sections on their websites to promote it — which also translates into profits. Examples include fashion retailers like H&M, where customers can hand in unwanted clothing or textiles in exchange for a digital coupon for future purchases; tech companies like Apple, which offers discounts on new devices when you trade in your current one; and Back Market, a marketplace entirely focused on refurbished technology. Online platforms like Vinted and Wallapop also give a second life to clothing and other items, fostering sustainable consumption.
Starting from 19 July 2026, the destruction of some unsold consumer products shall be prohibited, except for micro and small enterprises. For medium-sized enterprises, this prohibition will take effect from 19 July 2030.
Here's a brief timeline outlining the key milestones for the Ecodesign for Sustainable Products Regulation (ESPR):
Digital traceability, enabled by the DPP, is transforming supply chain transparency. It provides a comprehensive digital record of a product's lifecycle—from raw material sourcing to end-of-life disposal—, ensuring the authenticity of recycled or sustainably sourced products. This enhanced transparency supports better tracking of materials and compliance with circular economy principles.
Our collaboration with forward-thinking clients highlights the benefits of integrating the DPP. For example, our work with Cepsa on Digital Product Passports for Homecare Products demonstrates how our MARCO Track & Trace system has revolutionized their operations. By implementing digital traceability, Cepsa can track each batch of vegetable oil from its origin to its use in biodegradable surfactant production, automate bookkeeping and accurately determine the percentage of output from renewable and circular inputs.
In the following interview between my colleague Noslen Suarez and Juan Miguel Perez, CEO and Co-founder of Finboot, she explains in detail the Cepsa use case:
Adopting the DPP is not only an environmental imperative but also a strategic business advantage. Companies that integrate this technology are better positioned to enhance sustainability practices, improve operational efficiency, and achieve regulatory compliance, all while gaining a competitive edge in the market.
If you want to learn more about how to monetize the circular economy, download our free ebook “Monetizing the Circular Economy: Unlocking Revenue Streams with Digital Product Passports”:
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