The European Commission on Wednesday presented a first package of pilot measures aimed at speeding up Europe’s transition to a circular economy, with plastics firmly in the spotlight.
The initiative seeks to boost plastic recycling across the EU, strengthening the Single Market while improving economic security, competitiveness and environmental sustainability. The approach echoes the findings of the Draghi report, which identifies circularity and resource efficiency as critical drivers of Europe’s industrial competitiveness.
The Commission plans a two-step strategy. The newly announced package focuses on short-term, targeted actions, particularly in the plastics sector, where pressure is mounting. A broader legislative proposal — a Circular Economy Act — is scheduled for 2026 and will introduce horizontal measures to improve the EU market for secondary raw materials.
According to research by the Commission’s Joint Research Centre, the circular economy could significantly reshape the plastics sector. Circular solutions could cut climate-related emissions by up to 45%, reduce reliance on fossil-based energy and improve the EU’s trade balance by €18 billion annually by 2050.
Yet Europe’s plastic recyclers are under strain. Fragmented markets, high energy prices, volatile virgin plastic costs and competition from third countries are eroding profitability. Reduced capacity use and financial losses are already threatening the EU’s recycling targets and industrial base.
Tackling market fragmentation
A lack of harmonised EU-wide rules for recycled plastics has long hindered the free movement of secondary materials. The Commission’s new measures aim to address this gap.
Central to the package is a draft implementing act establishing EU-wide “end-of-waste” criteria for plastics under the Waste Framework Directive. The proposal defines when recycled plastics can re-enter the market as reusable materials, a move designed to simplify procedures for recyclers — especially small and medium-sized firms — and ensure a steady supply of high-quality recycled plastics. The draft is open for public feedback until 26 January 2026.
Member States will also vote on an implementing act clarifying how chemically recycled plastics can count towards recycled content targets for PET single-use beverage bottles under the Single-Use Plastics Directive. The measure is expected to provide legal certainty and unlock investment in chemical recycling, complementing existing mechanical recycling processes.
In parallel, the Commission plans to relaunch and strengthen the Circular Plastics Alliance, positioning it as a central platform for cooperation between industry, Member States and EU institutions to address shared challenges across the plastics value chain.
Levelling the playing field
To support fair competition, the Commission will introduce separate customs codes for virgin and recycled plastics. The change is intended to improve enforcement of EU rules on imports and help national authorities distinguish between different types of plastic materials.
The Commission will also step up monitoring of EU and global markets for virgin and recycled plastics, laying the groundwork for potential trade measures if unfair competition is identified. A review of these actions is planned for 2026.
Boosting investment and innovation
Financial support for circular economy projects will be expanded through closer cooperation with national promotional banks and the European Investment Bank. The Commission will also pilot a Competitiveness Coordination Tool to support Trans-Regional Circularity Hubs, encouraging cross-border cooperation and scaling up recycling capacity across the EU.
Reviewing single-use plastics rules
Alongside the new measures, the Commission has launched a public consultation to evaluate the Single-Use Plastics Directive. The review will assess its effectiveness in reducing plastic pollution, protecting human health and supporting a circular, innovative economy. Stakeholders can contribute to the consultation until 17 March 2026.