From now on, in our new POLITICS section, we will inform you regularly about ongoing and upcoming discussions, consultations and legislative changes related to packaging. The topic area of “sustainability” will play a major role in this for the foreseeable future. We will start with an overview of changes that are scheduled to come into force in 2022. They concern the Packaging Act, whistleblowers, taxonomy and reporting obligations, as well as a new guideline framework for “bioplastics”. Stay up to date to be prepared in time for the new requirements coming into force.
Political framework conditions now change seemingly every second. Many of them will keep us intensively busy in the product sector, but also in the corporate sector. On our par force hunt through some upcoming changes for the year 2022, we take three quick looks and three more detailed looks.
Guideline framework for bioplastics
In the upcoming „policy framework on bio-based, biodegradable and compostable plastics”, the EU is addressing the procurement, labeling and use of bio-based plastics. The web-based public consultation will run until March 15, 2022.
EU Packaging Directive
The draft of the new EU Packaging and Packaging Waste Directive is to be published on July 20, 2022. In a revision of the directive originally adopted in 1994, the EU Commission was asked to revise the basic requirements for packaging in 2018. Among other things, the aim is to improve design for reuse, promote high-quality recycling, reduce overpackaging and strengthen enforcement of the directive.
EU Sustainable Product Initiative
On March 30, 2022, the draft Sustainable Product Initiative is scheduled to be published. This initiative, which aims to revise the Ecodesign Directive and propose additional legislative measures where necessary, aims to make products placed on the market in the EU more sustainable.
EU Human Rights Directive
On February 23, 2022, the EU adopted the framework for the EU Human Rights Directive: The European Commission announced the adoption of a proposal for a Directive on corporate due diligence in the area of sustainability. Included are rules requiring large companies to assess and address negative human rights and environmental impacts in their value chains. The new regulations will initially apply to companies with more than 500 employees and sales of more than EUR150 million, and will be extended two years later to companies with more than 250 employees and sales of EUR40 million. The German Supply Chain Act will most likely be adapted to the EU regulations.
Deep Dive: The Packaging Law
The year 2022 brings (and has already brought) some changes and additions. In the following, we briefly summarize some of the most interesting innovations in chronological order.
As of January 1, 2022:
- Deposit: Various exceptions in the area of deposits on non-refillable beverage bottles and cans have been eliminated. In addition, deposits are charged on some products that were previously exempt from deposits.
- Plastic bags: Plastic bags with a wall thickness between 15-50 my were banned.
- Recycling rates: Recycling rates have been increased. 90 percent of packaging made of ferrous metals, aluminum, glass and paper, cardboard and carton must be recycled. Previously, a quota of 85 percent applied. For beverage cartons, the rate has risen from 75 to 80 percent.
Above all, however, it is important to introduce a
- New obligation to provide evidence: It applies to packaging that is not subject to system participation, such as transport packaging. By May 15 of each year, manufacturers and distributors must provide verifiable documentation of the quantity of packaging types they placed on the market and took back or recycled in the previous year. Further information here
On July 1, 2022…
… the last phase of amendments to the Packaging Act for the time being will also take place.
- Compulsory registration: Registration of all manufacturers of packaging in the LUCID packaging register with details of the types of packaging they place on the market. The compulsory registration then no longer only applies to companies that supply packaging that is subject to system participation, but in future also with regard to packaging that is not subject to system participation. Anyone who places packaging on the market in accordance with Section 15 (1) of the German Packaging Act (VerpackG), such as
- transport packaging,
- sales packaging and outer packaging that does not typically accumulate as waste at private end consumers after use,
- sales packaging and secondary packaging for which system participation is not possible due to system incompatibility in accordance with § 7 (5),
- sales packaging of hazardous filling goods and
- distributors of returnable and non-returnable beverage packaging subject to the mandatory deposit pursuant to § 31 and final distributors of service packaging who have delegated the fulfillment of their obligations to them.
- Data reporting: Data reports on packaging quantities must continue to be submitted to the systems and to the LUCID packaging register exclusively for packaging subject to system participation at the same intervals and with 1:1 content.
- Service packaging: Final distributors of service packaging in the LUCID packaging register who have completely delegated the fulfillment of their obligations to a pre-distributor level must also register. In the future, the “delegation” must also be confirmed in the register by marking a checkbox.
- Electronic marketplaces/ platforms: There are new, extended responsibilities for “electronic marketplaces/ platforms and fulfillment service providers”. They may only enable the offering of system-participating packaging for sale if the manufacturer has system-participated it and it is registered in the packaging register LUCID. Fulfillment service providers may only provide their activities to companies that have fulfilled their obligation to register in the LUCID packaging register and their system participation obligation.
Deep Dive: The Whistleblower Directive
The “Directive on the Protection of Persons Reporting Breaches of Union Law” (EU 2019/1937) guarantees whistleblowers who wish to report breaches of EU law more protection in the future, on the one hand, and obliges public and private organizations to set up secure whistleblowing channels, on the other.
The directive was adopted by the Council of the European Union on October 7, 2019. Germany would have had to transpose it into national law by December 17, 2021, which had not yet been done by February 2022. Therefore, since January 2022, the regulations of the EU Directive also apply to Germany until a national implementation is available.
The directive affects all companies with 250 or more employees. Companies with 50 to 249 employees must have implemented the directive by Dec. 17, 2023.
We have provided more information on what this exactly means for companies on our webseite.
EU taxonomy and reporting requirements
Capital market-oriented companies from the real economy that are required to provide non-financial reporting under the CSR Directive Implementation Act (CSR-RUG; see newsletter article “Quo vadis ESG reporting?”) must disclose for the first time in the EU taxonomy from 2022 – i.e. retroactively for the 2021 financial year – how and to what extent their activities are linked to „green“ economic activities that can be classified as sustainable.
The corresponding Regulation (EU) 2020/852 was adopted by the Council and Parliament of the EU on June 22, 2020 and will apply from January 1, 2022.
The rgulatory framework is part of the implementation of the Sustainable Growth Financing Action Plan. At the same time, it pays towards the implementation of the EU’s goal of climate neutrality by 2050.
The companies concerned must report on their climate protection and adaptation targets in accordance with the taxonomy for the fiscal year 2021. From the 2022 fiscal year, they must also report on the remaining four environmental targets (sustainable use of water resources, transition to a circular economy, pollution prevention, and protection of ecosystems and biodiversity).
The reporting focuses on three key figures:
- Revenue: Proportion of revenue from products or services related to environmentally sustainable business activities
- CapEx and OpEx: Share of total capital expenditures (CapEx) and/or share of operating expenditures (OpEx) related to assets or processes associated with environmentally sustainable economic activities
So far, this only affects companies listed on the capital market in Germany. But with the draft revision of the CSRD (Corporate Sustainability Reporting Directive) adopted by the EU Commission on April 21, 2021 and now presented, the group of affected companies would massively expand to all companies with 250 or more employees from 2024.