EU Launches Consultation on the Circular Economy Act: Compliance or Exit? How Can Enterprises Break Through?

On August 1, 2025, the European Commission officially announced the launch of the public consultation and evidence collection process for the Circular Economy Act, seeking wide-ranging opinions from the entire society. The deadline is November 6, 2025. The Act is expected to be...Officially implemented in 2026...marks a key step for the EU in building a unified policy framework for the circular economy.

The European Commission emphasizes that this legislation will help strengthen the EU inEconomic Security, Strategic Resilience, and Industrial CompetitivenessThe foundation in this aspect, and support its development.Decarbonization and Green Transformation Strategic GoalsIts core vision is:Double the EU material circularity rate by 2030 and establish an efficient and unified secondary raw materials market.。

Core content: Establish a single market for recycled materials and promote high-value recycling of electronic waste.

The Circular Economy Law is centered on two policy pillars.

1. Focusing on the upgrade of electronic waste management

• E-waste is the fastest-growing waste stream in the EU (with an annual growth rate of over 2%), yet its recycling rate is below 40%.

• The bill proposes to increase the recycling rate of critical materials (rare earths, lithium, nickel, etc.).

• Relevant instructions may be revised to promote standardization and unified implementation.

2. Establish a single market for secondary raw materials

• Reform the "End-of-Waste" standardsOpen up the legalization channel for recycled materials;

• Digital Extended Producer Responsibility (EPR) System；

• Public Procurement Green StandardsDrive market demand;

• Unified authentication system, eliminationRegulatory Fragmentation and Market Barriers Among Member States。

The bill will also be advanced in conjunction with a series of core policies, including the "Competitiveness Compass," the "Single Market Strategy," the "Critical Raw Materials Act," and the "Packaging and Packaging Waste Regulation," further improving the institutional foundation of the EU's green economy.

Background Motivation: Resource Security Anxiety and Policy Fragmentation Driving Transformation

The EU's accelerated legislation this time stems from a combination of multiple pressures.

• Severe resource dependenceHighly dependent on imported primary raw materials, especially in key areas of high technology and manufacturing.

• High pressure to achieve climate neutralityThe current material recycling rate is only about 11.8%, far from meeting green targets.

• Policy fragmentation and inefficiencyThe inconsistent standards among member countries and the disconnection in recycling, design, trade, and other links restrict the systematic implementation of the circular economy.

• Insufficient industrial momentumThe cost of recycled materials is high, and there is a lack of market trust, leading to a lack of willingness from businesses and consumers to adopt them.

Therefore, the European Union urgently needs to enact legislation to establish a unified market mechanism, improve the supply quality and market attractiveness of recycled materials, and promote the green economy to transition from "isolated experiments" to "systematic upgrades."

What is the impact on Chinese enterprises? Challenges and opportunities coexist.

For Chinese companies in the fields of plastic recycling and electronics manufacturing, the advancement of the EU Circular Economy Act presents both challenges and opportunities.

1. Compliance thresholds are rising, leading to a comprehensive restructuring of the product design chain.

• The proportion of recycled materials, recyclability, and product carbon footprint (PCF) will become strict requirements for export.；

• Chinese suppliers will be required to provide full lifecycle traceability data (connecting with DPP product passports).

• The fields of electronics, plastics, and automobiles will face large-scale pressure for green transformation.

2. Export of recycled materials must pass the "compliance check."

• Recycled plastics, rubber, and metals that do not meet the "waste-to-non-waste" standards, May be rejected by the EU；

• The enterprise is required to provideComplete Compliance Traceability + Certification Report…forcing China’s recycling system to improve and upgrade.

Investment and project opportunities are squeezed by local priorities.

• The EU legislation emphasizesLocal Investment Priority and Green Job Creation；

• Establish technical trade barriers for enterprises from third countries (such as formats, certification systems).Restrict Chinese enterprises from investing in or participating in space in Europe。

4. EPR responsibility will gradually hold Chinese manufacturing accountable for origin traceability.

• Electric tools and electronic devices exported from China to the European Union will be subject to a more stringent Extended Producer Responsibility (EPR) system.

• Register a responsible representative in Europe, pay recycling fees, submit annual reports, etc.Refer to the German Electrical and Electronic Equipment Act and the French EPR system.。

In the face of rule restructuring, China shouldAccelerate response from the aspects of system, industry, and resources.：

Policy: Promote national-level legislation on the circular economy

• Improve the "Circular Economy Promotion Law" by introducingMandatory Full Lifecycle Management Clause；

• Promote the eco-labeling system for products, such as mandatory labeling of "recycled material content."

• Establish a domestic green product certification system to enhance international competitiveness.

Industry: Accelerating Green Manufacturing and Ecological Design

• Encourage enterprises to developRepairable, disassemblable, recyclableof the product;

• Increase support forLCA Life Cycle Assessment, Green Design Standardssupport;

• Cultivate leading enterprises in green manufacturing chains and build global-level green industrial clusters.

Resources: Building a Strategic Regenerative Materials Security System

• Waste Classification and Recycling Depth；

• Enhance the quality control and traceability of recycled materials.

• Strengthen the regulation of renewable resource trade.Prevent the outflow of strategic resources。

In conclusion: China cannot be absent from the global green rules game.

The "Circular Economy Act" is not only an institutional change within the EU, but may also become...The "Template" for Future Global Green Trade and Resource GovernanceFor China, which is one of the world’s largest recycling markets, it should not merely be a “rule taker,” but should also strive to become a leader.Standard Setter and Industry Leader。