On 14 July 2021, the European Parliament passed a package of resolutions aimed at reducing greenhouse gases by at least 55% by 2030. Strengthened climate transformation within the EU poses new challenges for entrepreneurs. The wide-ranging changes will cause significant revisions to current business models of many companies. As a part of the adopted regulations, several key directives and systems for the European economy have been amended. They will affect the production process, transport and import of products, the possibility of benefitting public contribution and the tax issues as well.

There is no doubt that changes proposed by the European Parliament will affect production capacity. Using cheaper components or relocating production outside the territory of the EU may no longer be as profitable as before. The solutions adopted by the EU are intended to support products based on ecological technologies that use renewable sources of energy. They will also lead to discourage entrepreneurs from relocating production outside EU territory.

A significant part of the package relates to a further reduction of greenhouse gas emission limits and an increase in their annual reduction under the 'EU Emissions Trading System' (EU ETS).

Profound changes will affect the energy sector. One of the adopted regulations is the establishment of a new expected level of renewable energy in the national energy mix. By 2030, it is to be as high as 40%.

Moreover, entrepreneurs involved in transport and construction will have to adapt to the new emissions trading system, specially dedicated to these sectors.

The package contains many mechanisms to support the rapid transformation of the automotive market. Very ambitious targets have been set for reducing emissions from new vehicles. According to the new emission standards, emissions will be reduced by 55% by 2030 and by 100% by 2035. In order to support entrepreneurs and encourage consumers to purchase zero-emission vehicles, a broad programme of support for infrastructure for zero-emission vehicles will be introduced. The goal will be achieved by building a network of charging and hydrogen refueling points.

The above examples show that new regulations greatly interfere with the economy. The changes are complex and certainly every entrepreneur will have to face them sooner or later.

Please feel free to contact us with any questions you may have concerning the impact of the European Parliament's package on a particular economic sector.