In line with green transition in the EU, fresh policy proposals are making their way forward. The drafts – if adopted – require companies to take considerable steps, while the modifications will also result in enhanced rights for consumers: extended eco-design obligations, reclassified unfair commercial practices, novel consumer rights – such as the “right to repair” – are to be expected.

The draft ecodesign requirements for sustainable products regulation (ESPR)

This regulation extends the material scope of the existing Ecodesign Directive (2009/125/EC) to most categories of products on the market, thus effecting clearly more companies. It also aims to minimize product life-cycle environmental impact through design solutions (materials, reparability, etc.)

Key elements of the proposal:

1. Broader Compliance: All products circulating on the internal market must meet adjusted ecodesign criteria; promoting durability, reliability, reusability, and environmental considerations.
2. Digital Passport: Necessity to have digital passports for select products to enhance traceability, aide repair and recycling efforts. A public online platform for passport comparison is mandated.
3. Unsold Goods: Transparent handling of unsold goods is mandated, with potential bans on environmentally impactful product destruction.
4. Online Marketplace Oversight: Online marketplaces must cooperate with surveillance authorities to enforce eco-design requirements.
5. Circumvention Prevention: Test-detecting products and products which alter performance are prohibited.
6. Green Public Procurement: Commission empowerment for ecodesign requirements in public contracts is introduced.

According to the draft, premature product obsolescence must also be prevented. The ESPR aims to ban the destruction of unsold textiles, footwear, and electronic equipment, with some exceptions for small and medium-sized enterprises.

Following the publication of the Member States agreed “general approach”, the trialogue between the Parliament and the Council started on August 30, 2023. The current Spanish presidency of the European Union aims to conclude the file before Christmas.

What to expect in Hungary?

In accordance with the new regulation, legislative change is to be expected in Hungary, pertaining Government Decree 65/2011 (IV. 15.) on the imposition of ecodesign obligations on energy-related products and on the general conditions for placing on the market and conformity assessment. As a result, ecodesign criteria will be extended also to new categories of products.

At Dentons we follow closely the relevant developments of the GPSR, and as a start, we suggest that economic operators examine their readiness for the coming changes by using the following check list:

1. Do you, as a business entity, have a full understanding of the new ecodesign criteria?
2. Do my products need digital passports, and if yes, do I know how it is done?
3. Are your facilities prepared for the required handling of unsold goods set by the law?

Empowering consumers for the green transition

Empowering consumers is also a key element within the Green Deal framework. Therefore, a new directive was proposed for consumer empowerment, amending the Unfair Commercial Practices Directive (UCPD) and the Consumer Rights Directive (CRD). In late September, the Council and the European Parliament agreed on the final text, which now only awaits the official endorsement by the co-legislators. This is to be expected in November 2023.

Product-specific information requirements will ensure consumers know the products’ environmental impacts and can make an informed transitional decision accordingly. Key elements of the proposal include:

1. Informed Decisions: Consumers must be informed about product durability, reparability, and environmental/social impact to prevent misleading information.
2. Transparency in Sustainability Comparisons: Services comparing product sustainability must specify the products and suppliers and must disclose comparison methods to avoid misleading consumers.
3. Banning Unethical Practices: Ten new practices are banned, including false sustainability labels and generic environmental claims.
4. Enhanced Consumer Information: When buying, consumers must be educated about extended guarantees and receive repairability scores or information about spare parts and user manuals.
5. The new law also bans carbon offsetting-based environmental claims, sustainability labels without certification, while claims related to future environmental performance won't be allowed on the product level.
6. Sustainability labels not based on approved certification schemes or established by public authorities will not be allowed.
7. Introduction of a guaranteed lifespan label, reflecting both the legal guarantee and the product's lifespan. A harmonized graphic format is to be introduced for recognizing durability guarantees.

Once officially endorsed, Member States will have to transpose the directive in 18 months and begin applying it within an additional six months.

In line with the new directives, the change of Act XLVII of 2008 on the Prohibition of Unfair Business-to-Consumer Commercial Practices and of Act CLV of 1997 on Consumer Protection is to be expected.

At Dentons we are constantly monitoring the legislative novelties and suggest the following check list to examine the preparedness for the coming developments:

1. As a business entity, do you have a comprehensive understanding of the coming changes of the UCPD and CRD?
2. Do you have commercial practices that might be banned under the new laws?
3. Is your business model and products compatible with the prohibition of premature obsolescence?
4. Do you, as a business entity, utilize environmental claims or sustainability labels, and if yes, do they fulfill the new requirements?