The European Commission has unveiled a first set of pilot measures aimed at accelerating Europe’s transition to a circular economy, with an initial focus on the plastics sector, as it seeks to strengthen industrial competitiveness, economic security and environmental sustainability.
The package forms part of a broader two-step approach. In the near term, the Commission is rolling out targeted actions to address acute pressures in specific sectors, notably plastics, while encouraging investment and innovation across the economy. In 2026, it plans to table a Circular Economy Act, which will introduce horizontal measures to improve the functioning of the Single Market for secondary raw materials.
According to evidence from the Commission’s Joint Research Centre, circular solutions could reduce climate-related emissions in the plastics sector by up to 45%, support the decarbonisation of energy use, and improve the EU’s trade balance by around €18 billion a year by 2050.
The Commission said action is needed as plastic recyclers face mounting challenges, including fragmented markets for recycled materials, high energy costs, volatile prices for virgin plastics and competition from third countries. These pressures have already led to lower capacity utilisation and financial losses among EU recyclers, putting both circularity targets and industrial competitiveness at risk.
A key element of the package is a move to overcome market fragmentation. The Commission has published a draft implementing act to establish EU-wide end-of-waste criteria for plastics under the Waste Framework Directive. By defining when recycled plastics can again be considered products rather than waste, the measure is intended to simplify administrative procedures, particularly for small and medium-sized enterprises, and support a more integrated Single Market for recycled plastics. The draft is open for public feedback until 26 January 2026.
Member States are also being asked to vote on an implementing act concerning recycled content requirements for PET single-use plastic beverage bottles under the Single-Use Plastics Directive. The Commission said clearer rules could create new opportunities for chemical recycling, provided certain conditions are met, and help unlock investment by increasing legal certainty.
Alongside regulatory changes, the Commission plans to relaunch and strengthen the Circular Plastics Alliance as a more structured platform for cooperation across the plastics value chain, bringing together industry, Member States and EU institutions to address shared challenges.
To support fair competition, the Commission will introduce separate customs codes for virgin and recycled plastics, enabling customs and market surveillance authorities to better enforce EU rules on imported products. It will also step up monitoring of EU and global markets for virgin and recycled plastics, with a review of potential trade measures planned for 2026.
The package includes measures to encourage investment and innovation, including closer collaboration with national promotional banks and the European Investment Bank. A pilot Competitiveness Coordination Tool will support Trans-Regional Circularity Hubs, aimed at fostering cross-border cooperation and scaling up recycling and circular practices.
In parallel, the Commission has launched a public consultation and call for evidence to evaluate the Single-Use Plastics Directive, assessing its effectiveness in reducing environmental and health impacts while supporting a circular and innovative economy. The consultation will remain open until 17 March 2026.
The Commission said the measures respond to the need to accelerate Europe’s shift to circularity, noting that recycled materials accounted for just 12.2% of material use in the EU in 2024, up from 11.2% in 2015. The pilot actions are intended to lay the groundwork for the Circular Economy Act due by the end of 2026, and to deliver on commitments made by Commission President Ursula von der Leyen to speed up the transition to a circular economy.
