EU Circular Economy Act: Packaging organizations debate Single Market protection

The EU’s forthcoming Circular Economy Act (CEA) aims to promote the union’s transition to a circular packaging economy. However, packaging organizations Europen and the European Environmental Bureau (EBB) argue that the legislative initiative needs to go beyond its current scope to establish a single market and ensure environmental protection. 

“The Clean Industrial Deal identified circularity as a strategic priority, with the CEA designed to accelerate the transition by building on the EU Single Market and enabling the free movement of circular products and secondary materials while stimulating demand for them,” Francesca Stevens, secretary general at Europen, tells Packaging Insights. 

“However, the recent European Commission (EC) 2026 Annual Single Market and Competitiveness Report underlined that, in the area of packaging, labeling, and waste, the Single Market remains fragmented, contributing to slow progress toward circularity.”

The EBB agrees that the CEA can go beyond its current scope, while urging that environmental protection should take precedence over the Single Market. 

Marco Musso, deputy policy manager for circular economy at the EBB, tells us: “While the public consultation for the CEA focused on harmonizing rules for recycling and secondary raw materials, it largely overlooked prevention, reuse, and repair, as well as the systemic issues of overproduction, overconsumption, and overdependence on material extraction.”

He says the EU’s Packaging and Packaging Waste Regulation (PPWR) has illustrated how concerns about Single Market integrity can be exploited to slow down environmental efforts. 

“Certain actors have actively tried to stop national efforts to cut waste and pollution, via lobbying and legal challenges, using the argument that diverging national initiatives would hurt trade of packaging and packaged goods within the EU.”

Discrepancies in the Single Market

In a joint statement, co-signed by Europen and 70 other European packaging sector entities, the industry has called for the CEA to be grounded on the principles of the Single Market, as established in Article 114 of the Treaty on the Functioning of the EU (TFEU). 

Francesca Stevens, secretary general at Europen.Stevens says: “Current performance disparities illustrate the scale of the challenge. Nearly half of EU member states continue to landfill more than 30% of municipal waste, with several significantly exceeding this level, while only a limited number are on track to meet the 2025 recycling targets.”

“Such uneven implementation not only slows environmental progress but also distorts competition and weakens the integrity of the Single Market. It is evident that ambitious circularity objectives can only be achieved through harmonized rules that drive a step-change in waste management performance across the EU.”

“Grounding the new CEA in the internal market legal basis [Article 114 TFEU] is essential, in particular to enable a genuine Single Market for secondary raw materials.” 

As the EU seeks to strengthen its competitiveness, resilience, and strategic autonomy, Stevens says: “The CEA represents a key opportunity to establish uniform rules, ensure a level playing field, and unlock the full economic potential of circular value chains.”

Member state action needed

EBB’s Musso agrees that individual EU countries need to advance their own national measures to meet the harmonized requirements set out in the PPWR. He adds that these requirements do not go far enough in actually meeting the PPWR 5% reduction target for packaging waste generation by 2030. 

“This shows that the Single Market must not be used as an excuse to excessively restrict sustainable action at the national and local level.”

He argues that relying solely on Article 114 TFEU leaves a structural gap providing an insufficient legal mandate to address the environmental dimensions of the circular economy transition.

“The legitimate pursuit of market integrity is sometimes misused to excessively limit member states’ right to adopt measures that go beyond the EU’s minimum requirements to protect health and the environment. These additional policies are, however, often essential for member states to meet EU targets on waste prevention, reuse, and waste management.”

Marco Musso, deputy policy manager for circular economy at the EBB.Musso sees the value of the Single Market in its social, labor, environmental, and consumer protection standards, which protect citizens and businesses. “Efforts to deepen and strengthen the Single Market must therefore never compromise the environmental and social standards that underpin it.”

He adds CEA should include mandatory prevention, reuse, and repair targets, which he sees as essential “to move up the waste hierarchy” and ensure real systemic change.

Setting recycling targets 

The EC has stated it will introduce recycled content and recycling targets for additional materials and sectors as part of the CEA. 

Musso says that when designing these targets, care should be taken to ensure that recycled content only accounts for recyclates from post-consumer waste.

At the same time, targets for recyclate and bio-based content should be kept separate “to avoid diluting ambitions and to promote the most environmentally sound recycling technologies.” He urges the explicit exclusion of harmful recovery processes such as pyrolysis and gasification. 

The concerns on the imports of recyclates that do not comply with EU standards must also be adequately addressed in the CEA.

“The CEA should also ensure that the incorporation of recycled materials does not extend our contact with harmful chemicals and the rigorous implementation of the Empowering Consumers Directive to effectively prevent greenwashing and misleading and/or irrelevant claims on recycled content in consumer products,” says Musso.

“Recycled content obligations need to be supported by reliable and trustworthy accounting methodologies, which do not rely on credit mass balance or book and claim, avoiding structural greenwashing in operators’ declarations,” he concludes.