26 Apr 2023

The Circular Economy Package & The Green Deal Industry Plan

On 22 March 2023, the European Commission unveiled its long awaited proposal for a Directive on the substantiation and communication of explicit environmental claims. The Green Claims Directive  aims to establish criteria to prevent companies from making misleading claims about the environmental merits of their products and services, while restoring consumers’ trust in green labels. If adopted, the voluntary environmental claims made by companies, including those comparing the environmental performance of different products, will be subject to strict substantiation requirements and to third party verification before being communicated. While this will have to be confirmed by the co-legislators, the Directive requirements should not apply to claims or environmental labelling substantiated by rules established in sector specific legislation, including the Packaging and Packaging Waste Directive (or future Regulation).

Commissioner Virginijus Sinkevičius is confident that the Green Claims proposal will be adopted during the current Commission mandate, given the level of support from the European Parliament and Council, where the ENVI Committee and the Environment Council are expected to lead on the file. Meanwhile, the Commission has launched a feedback period and interested stakeholders are invited to provide their views until 7 June 2023.

On 16 March 2023, the Commission presented two other sustainability milestones: the Net-Zero Industry Act - a proposal for a regulation with the objective to introduce a framework to scale up the European manufacturing capacity for net-zero technologies to support the European Union’s 2030 decarbonization target; and the Critical Raw Materials (CRM) Act - a proposal for a Regulation aimed at ensuring a secure and sustainable supply of critical raw materials, which are of high economic importance for Europe.

What can we expect from the proposals? The Commission foresees the Net-Zero Industry Act will enable companies to manufacture clean technology within the Union, preventing a leakage of production to third countries, helping them achieving the European Union’s climate targets while ensuring strategic autonomy. The CRM Act should instead support companies manufacturing strategic technologies, which consume a high degree of strategic raw materials. According to the proposal, companies falling within the scope of this provision will have to perform an audit of their supply chain every two years, mapping their dependencies on third countries, and conduct a stress test of their supply chain.

What did you miss?

  • 30 November 2022: Publication of the European Commission Circular Economy Package II

What’s next?

  • Ordinary legislative procedure: the Green Claims Directive proposal will now be subject to the approval of the European Parliament and the Council (expected adoption before 2024).