The European Commission is developing a Circular Economy Act. The purpose of this Act is to anchor circular practices within the European economy, particularly for products containing strategic and critical materials. The Commission’s intentions can be found at the link provided.
Based on our experience, we would like to offer several ideas and points of attention for the further development of the Act. We have summarized these in a concise position paper, emphasizing aspects that are currently missing but are essential for effectively shaping the transition to a circular economy. In our contribution, we highlight three key points:
The current outline of the Circular Economy Act appears to focus mainly on lower‑value circular principles, such as matching supply and demand for secondary raw materials. In our view, it is crucial that the Act provides guidance at a higher level than material use alone. This includes, for example, lifetime extension and design-for-disassembly, such as requiring replaceable batteries in electronic products. These principles could be further incorporated under the Ecodesign for Sustainable Products Regulation (ESPR).
To achieve the shift toward a circular economy, it is important not only to build new circular systems but also to phase out existing linear production. This active phase-out must occur across almost all sectors. Given the free European internal market and the presence of large international producers, this requires a coordinated European effort.
Examples of sectors that need an exit strategy for linear products include renewable energy technologies and clothing. A national-level illustration is France’s ban on ultra-fast fashion.
The consultation suggests that the Circular Economy Act will have positive effects for citizens, such as increased employment and access to affordable (circular) products. However, these outcomes will not materialize automatically. At present, circular alternatives are often more expensive, partly due to higher labour and production costs and the tax advantages currently benefiting linear products. Addressing this requires, among other measures, adjustments to tax regulations and clear guidelines on VAT treatment for reused and second-hand products.
Additionally, many new “circular” jobs are currently found in the waste and recycling sectors. Because these sectors often work with discarded products, such jobs are sometimes perceived as “dirty” or undesirable. Investing in technological innovation to improve working conditions is therefore crucial to ensuring that circular job opportunities remain attractive.
We believe the Circular Economy Act offers Europe an opportunity to position itself as a global frontrunner in the transition to a circular economy. As Europe is almost entirely dependent on raw materials imported from outside the EU, a strong circular strategy is essential to maintain long-term prosperity and economic competitiveness.
At the same time, the current political context makes it challenging to take uniform, EU-wide steps. Not every member state is progressing at the same pace or starting from the same economic position. A phased implementation that reflects the economic realities of individual countries will allow frontrunners to move ahead while enabling others to learn from their progress.
*Please note that this publication is only available in Dutch.
