EUROPEAN COMMISSION

Brussels, 30.3.2022

SWD(2022) 85 final

COMMISSION STAFF WORKING DOCUMENT

IMPACT ASSESSMENT REPORT

Accompanying the document

Proposal for a DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

amending Directives 2005/29/EC and 2011/83/EU as regards empowering consumers for the green transition through better protection against unfair practices and better information

{COM(2022) 143 final} - {SEC(2022) 166 final} - {SWD(2022) 86 final}

Table of contents

1.Introduction: Political and legal context

2.Problem definition

2.1.Problem 1: Consumers lack reliable information at the point of sale to make environmentally sustainable consumption choices

2.2.Problem 2: Consumers face misleading commercial practices related to the sustainability of products

2.3.What are the problem drivers?

2.4.How will the problems evolve without intervention?

3.Why should the EU act?

3.1.Legal basis

3.2.Subsidiarity: Necessity of EU action

3.3.Subsidiarity: Added value of EU action

4.Objectives: What is to be achieved?

4.1.General objectives

4.2.Specific objectives

5.What are the available policy options?

5.1.What is the baseline from which options are assessed?

5.2.Description of the policy options

6.What are the impacts of the policy options and how do they compare?

6.1.Problem 1: Consumers lack reliable information at the point of sale to make environmentally sustainable consumption choices

6.2.Problem 2: Consumers face misleading commercial practices related to the sustainability of products

7.Preferred policy options

8.How will actual impacts be monitored and evaluated?

Annex 1: Procedural information

1.Lead DG, Decide Planning/CWP references

2.Organisation and timing

3.Consultation of the RSB

4.Evidence, sources and quality

Annex 2: Stakeholder consultation

1.Introduction and overview of the consultation strategy

2.Consultation activities and tools

3.Evidence, sources and quality

4.Main stakeholder feedback per consultation activity

5.Feeding the consultation results into the Impact Assessment

Annex 3: Who is affected and how?

1.Practical implications of the initiative

2.Summary of costs and benefits

Annex 4: Analytical methods

1.Selection of criteria and sub-criteria for assessing the impacts of the policy options

2.General approach to assess the various impacts

3.Socio-economic impacts

4.Approach to monetisation of costs and benefits

Annex 5: Additional data and explanation of estimates of consumers and environmental impacts

1.Problem 1: Consumers lack reliable information at the point of sale to make environmentally sustainable consumption choices

2.Problem 2: Consumers face misleading commercial practices related to the sustainability of products

Annex 6: Overview of relevant existing and upcoming national legislative initiatives

Annex 7: Overview of EU legislation relevant for the problems the initiative aims to address

Annex 8: Impacts of the policy options – detailed assessment

1.Problem 1: Consumers lack reliable information at the point of sale to make environmentally sustainable consumption choices

2.Problem 2: Consumers face misleading commercial practices related to the sustainability of products

Annex 9: Detailed results from the Cost and Benefit Analysis and from the Multi-Criteria Analysis

1.General approach to compare the various option/options

2.Presentation of the results per sub-problems

Annex 10: Monitoring indicators

Annex 11: Options discarded at an early stage

1.Problem 1: Consumers lack reliable information at the point of sale to make environmentally sustainable consumption choices

2.Problem 2: Consumers face misleading commercial practices related to the sustainability of products

Annex 12: Consequences of the problems for Consumers, the Market and the Environment

1.Consequences of Problem 1

2.Consequences of Problem 2

Annex 13: Analysis of product scope for providing durability/reparability information

Glossary

1.Introduction: Political and legal context

The European Green Deal 1 sets out a comprehensive strategy to transform the EU into a fair and prosperous society, with a climate-neutral, resource-efficient, clean and circular economy in which economic growth is decoupled from resource use and where negative impacts on natural capital and biodiversity are reduced. To deliver the European Green Deal, there is a need to rethink a number of EU policies and among them also production and consumption. The aim of reforms is to encourage the needed changes both in consumer and business behaviour. To achieve this two-fold objective, the Circular Economy Action Plan (CEAP) 2 and the New Consumer Agenda 3 set out several mutually reinforcing and complementary actions. A number of initiatives are being taken already with the aim to ensure that products, both goods and services, sold to EU consumers are fit for the above objectives. 

Given that the current consumption of products is recognised to represent an unsustainable burden on the environment 4 , this Impact Assessment (IA) presents policy actions to facilitate the needed changes in consumer behaviour to achieve climate and circularity objectives under the European Green Deal. As the initiative aims to deliver on the European Green Deal, and thus to reduce the burden of consumption on the environment, it covers primarily environmental sustainability. However, as per its mandate, the initiative aims to tackle social and ethical aspects of sustainability where relevant, i.e. in relation to sustainability labels and digital sustainability information tools. This is due to the fact that labels and tools already widely present on the market often cover other aspects of sustainability, and thus fall within the problem definition identified by this initiative.

Data from a 2009 Eurobarometer show that 83% of EU-27 citizens considered a product’s impact on the environment an important element when deciding which products to buy 5 . Moreover, many European citizens believe that “changing the way we consume” is the most effective way to tackle environmental problems 6 . The COVID-19 crisis does not seem to have dampened the public’s awareness of this need to address climate change, nor their willingness to do so. Studies even suggest that the crisis has re-intensified citizens’ support for tackling environmental problems 7 . When asked about the long-term impact of the COVID-19 crisis, between 66% and 76% of consumers surveyed in 4 EU countries in May 2020 said they “will buy products that are better for the environment, even if they cost more” 8 . The challenge is to unlock this potential through policy measures that empower, support and enable European consumers to play an active role in the green transition. 

In one of its recent resolutions 9 , the European Parliament has called on the European Commission to show strong political ambition when designing this and other related initiatives. It calls specifically to develop measures on the provision of pre-contractual information on the lifespan and reparability of products as well as measures to combat premature obsolescence or greenwashing among other aspects. In the recent Council Conclusions on the New Consumer Agenda 10 , Member States have “welcomed the Commission’s intention to propose measures in order to promote sustainable consumption by improving consumers’ right to accurate and effective information, and to better protect them against certain practices such as unsubstantiated green claims and greenwashing”. With such rules, the EU27 as one of the largest economies in the world 11 , can act as a standard-setter for options to encourage sustainable consumption in other jurisdictions.

Objective and scope of this initiative

Within the area of environmental sustainability, this initiative focuses on those aspects of environmental sustainability which can be most appropriately addressed by horizontal consumer law. As foreseen in the CEAP and the New Consumer Agenda, this initiative tackles the identified problems via a revision of consumer law, setting general requirements that would complement more targeted rules contained in sectoral legislation, e.g. on specific products or product groups. It therefore focus on empowering consumers in their decision-making process, and does not consider the use of other non-consumer law instruments that may in addition provide further solutions for better empowering consumers for the green transition, such as, for example, fiscal policy instruments or sectorial policy instruments.

As per its mandate under CEAP, this consumer law initiative will tackle problems identified with the consumer’s decision-making process at the point of sale and business-to-consumer commercial practices (i.e. any act, omission, course of conduct or representation, commercial communication including advertising and marketing, by a trader, directly connected with the promotion, sale or supply of a product to consumers). It will address the provision of reliable consumer information, in particular the fact that consumers lack reliable information at the point of sale for choosing more environmentally sustainable products. It will also strive to better protect consumers against unfair commercial practices, such as greenwashing, early obsolescence of consumer goods or non-transparent voluntary sustainability labels and digital information tools, which are not compatible with the green transition.

Results from a consumer survey carried out to support this initiative show that a lack of reliable information about products’ environmental sustainability, reparability and lifespan feature among the main obstacles preventing consumers from adopting more sustainable consumption behaviours. According to recent consultations 12 , 85% of respondents reported being unsatisfied or only partially satisfied with the environmental information available to them, due (among other factors) to the fact that such information is generally not sufficient to support consumer decision-making. Another survey 13 showed that 82% of the participants agreed that it is difficult to find information on how long a product will last and on its reparability. In addition, 86% agreed that they would like to receive better information on how long a product will last and 83% agreed that they would like to receive better information on how easy it is to repair a product. These findings are also confirmed by the results of the Open Public Consultation carried out for this initiative 14 .

Based on these findings, the initiative considers the provision of information on the environmental characteristics of products, addressing in particular the provision of information about durability (“how long will a product last before it needs to be replaced or repaired?”, “will it break/become obsolete earlier than expected or than what has been communicated by the trader?”) and reparability (“can consumers know whether a product can easily be repaired?”). More durable and more reparable products can not only lead to savings for consumers in that consumers will have to spend less money on replacement products, but can also bring environmental benefits, in that less pollution and waste are emitted if products are repaired and/or last longer 15 . These two parameters are identified as highly relevant to help consumers assess a product’s environmental sustainability 16 , and are equally relevant from a consumer’s economic perspective 17 ,  18 .

This initiative also addresses certain misleading commercial practices which prevent consumers from making sustainable consumption choices. These practices include early (or premature) obsolescence. This occurs when a product fails prematurely or lasts for a shorter period of time than consumers can reasonably expect 19 . Another misleading commercial practice considered by this initiative is that of ‘greenwashing’, which occurs when a trader attempts to present an environmentally responsible public image in a way that is unfounded or misleading. This often takes the form of making unclear or not well-substantiated environmental claims 20 . This initiative addresses such practices as they relate to key aspects of environmental sustainability and can under certain conditions already be addressed under existing consumer law 21 . As per its mandate under CEAP, this initiative also seeks to improve the transparency and credibility of sustainability labels and digital information tools: in this respect, and only when it comes to the options aimed at addressing this problem, as mentioned above and further specified in Section 5, this initiative uses a broader concept of sustainability that also includes social and ethical aspects, given that sustainability labels available on the market also cover such a wider range of sustainability attributes 22 .

Other environmental sustainability and circularity aspects are explicitly not covered in this IA as they are already regulated elsewhere or may not be fit to be regulated in a horizontal consumer law instrument. For example, information on the energy efficiency 23 of goods is not considered in this IA as it is already regulated by the mandatory EU Energy Label 24 . Recycling aspects are also already covered by product design and packaging rules or waste legislation 25 . Moreover, multiple other sector specific initiatives are being prepared and undertaken in the context of the Circular Economy Action Plan, such as in areas like plastics, textiles, buildings or food. Notwithstanding this, some of the problems addressed in this initiative in fact relate to all aspects of environmental sustainability. Insofar as this initiative addresses misleading environmental claims, it addresses claims relating to all aspects of environmental sustainability, including, for example, recycling aspects. Similarly, in addressing unreliable sustainability labels and digital information tools, this initiative addresses labels and tools relating to all aspects of sustainability, including all aspects of environmental sustainability.

Interaction with existing legislation and upcoming initiatives

As lex generalis, this initiative will provide for general consumer protection rules that will be complemented by other EU-level technical or sector-specific instruments (lex specialis), when they provide for more detailed rules. This applies to existing rules (for example: ecolabels, eco-design measures, food labelling legislation) or upcoming initiatives. There will thus be no change to the current relationship between environmental and product policy legislation and consumer law instruments.

As further demonstrated in Section 5, this initiative is self-standing and developed in full coherence with the upcoming Green Claims Initiative and the Sustainable Products Initiative (adopted together with this initiative), both also announced in CEAP. While these initiatives are linked in their purpose to enhance sustainable production and consumption, they do so by focusing on different market participants, at different stages of the value chain. They also have differing product scopes and introduce different types of requirements.

Indeed, this initiative will focus on the demand side, and more particularly at enhancing the environmental sustainability information provided to consumers at the point of the sale and at better protecting consumers from practices that could mislead them and thus interfere with the integrity of their transactional decisions, luring them away from sustainable consumption choices. To do so, it will focus on the obligations of traders towards consumers.

The objective of the Green Claims initiative will be to introduce certain requirements in relation to environmental claims on products and organisations. The initiative would establish methodological requirements on how environmental claims are communicated and substantiated.

The main objective of the Sustainable Products Initiative (SPI) is to introduce sustainability requirements for products placed on the market, thus targeting manufacturers. The SPI will create a framework that allows the setting of both minimum requirements and information requirements for specific product or groups of products. The initiative should expand the scope of the Ecodesign Directive to a wider range of products, and to new types of requirements to better cover the life cycle of products, circularity and possibly social aspects. Information requirements set through SPI can help consumers distinguish the relevant products based on their sustainability performance (the information required will depend on the product and can range from the origin of materials to environmental performance, durability, reparability, chemicals of concern, handling at the end of life etc.). The SPI also aims to establish a digital product passport which would give access to such information along the value chain, with differentiated access to consumers, businesses and compliance authorities. The initiative examined in this IA would similarly contribute to the aim of allowing product differentiation by intervening at the point of sale and facilitating consumer access to relevant information, i.e. as regards to the durability or reparability of products. In this respect, the SPI will act as a lex specialis vis-à-vis horizontal consumer law information requirements by providing further information on the product or group of products in question in accordance with the specific requirements of the SPI. For further details on the interaction between the initiative subject to this Impact Assessment and other EU initiatives currently under preparation, please see Annex 7.

In addition, as regards food products, this consumer law initiative is completed by actions announced in the Farm to Fork Strategy 26 . In particular, the Commission announced that it will make a legislative proposal for a sustainable food system and will examine ways to create a sustainable food labelling framework that covers, in synergy with other relevant initiatives, the nutritional, climate, environmental and social aspects of food products. As lex specialis, such a labelling framework would thus further specify the rules set out under general consumer law (and therefore those flowing from this initiative). Additional regulatory and non-regulatory initiatives will also be developed to address specific groups of goods and services, such as ICT, electronics, textile, packaging or telecommunications, again, under the lex specialis logic.

Finally, this initiative in conjunction with other initiatives in preparation, will also contribute to the right to repair 27  as announced in the New Consumer Agenda, by giving consumers certain horizontal rights regarding access to information on reparability or by better protecting consumers against early obsolescence practices (including a lack of reparability).

Results of previous evaluations

In 2017, the EU Consumer and Marketing Law and the Consumer Rights Directive underwent a Fitness Check and evaluation, respectively. 28 The findings from this exercise pointed primarily to the need to improve awareness, enforcement of the rules and redress opportunities to make the best of the existing legislation and highlighted a limited range of necessary changes due to digitalisation. 

Given the focus on enforcement and digitalisation, there were no specific conclusions in relation to the contribution of the consumer acquis to sustainable consumption, an issue which in fact gained further political prominence a number of years later with the announcement of the European Green Deal. Nevertheless, whenever possible and relevant, this Impact Assessment draws on the findings and conclusions collected in this exercise.

2.Problem definition

In spite of consumers’ willingness to contribute to a greener and more circular economy in their everyday lives 29 , their effective and active role in this green transition is hampered by a lack of reliable information at the point of sale to make environmentally sustainable consumption choices (Problem 1) and by misleading commercial practices related to the sustainability of products (Problem 2). As mentioned in Section 1 above, this Impact Assessment will address primarily the lack of reliable information related to products’ durability and reparability, as well as misleading practices related to the sustainability of products. A further justification for the selection of these particular aspects of reliable information and these particular misleading practices is provided below.

These problems are the consequences of two types of drivers. On the market side, there is a lack of incentives to provide reliable environmental sustainability information and not to engage in certain practices. In addition, the regulatory framework fails to specify which information consumers should be provided with as regards these sustainability dimensions and does not address effectively certain misleading practices running counter to the aims of the green transition, making difficult effective enforcement.

In turn, Problem 1 and Problem 2 translate into consequences for consumers (detriment, lack of trust), businesses (uneven playing field, compliance costs) and the environment (non-realised benefits that a more sustainable consumption would bring).

An overview as well as a more detailed analysis of the various stakeholder consultations conducted to measure the extent of the problems identified in this Impact Assessment can be found in Annex 2.

2.1.Problem 1: Consumers lack reliable information at the point of sale to make environmentally sustainable consumption choices 

When comparing products and making purchase decisions, evidence suggests that consumers often lack reliable information at the point of sale on products’ environmental sustainability. This includes information about the environmental characteristics of products, their durability/lifespan and their reparability. Detailed evidence identifying the lack of reliable information on these particular aspects as particularly problematic is presented below.

2.1.1.Lack of reliable information on the environmental characteristics of products (Sub-problem 1.1)

According to the consumer survey conducted for this Impact Assessment, half of the respondents say they look actively for information about the environmental characteristics of products, such as their environmental impacts or performance, greenhouse gas emissions, water use etc. However a large number of them find that the existing information is simply insufficient 30 . 

2.1.2.Lack of reliable information on the lifespan of goods (Sub-problem 1.2)

Evidence shows that information on the “expected lifespan” of goods (i.e. years of life, hours of use, number of cycles etc.) is hardly ever made available to consumers. For instance, the mystery shopping exercise carried out as part of the Study supporting this Impact Assessment showed that in more than 95 % of cases, information relating to the goods’ expected lifespan was not available. This is confirmed by observations from consumers and stakeholders, including manufacturers and retailers, surveyed for this Impact Assessment 31 .

Information about the “guaranteed lifespan” is naturally only available when a commercial guarantee is offered by the trader (corresponding to the number of years covered by the commercial guarantee). Moreover, research shows that while consumer products are regularly offered with a commercial guarantee (in 66% of the mystery shops at least one commercial guarantee was offered, 38% of which were included in the price of the product), the information on such commercial guarantees, and the way that consumers are being charged, is often unclear, imprecise or incomplete making it difficult for consumers to compare between products and to distinguish this commercial guarantee from the (compulsory) legal guarantee.  32

As regards information on the availability of software updates, the mystery shopping exercise carried out for this Impact Assessment showed that in only 1.25% of cases the product contained an indication that software updates and/or upgrades were ensured and in only one case information about the period of the commitment of the software updates was provided given (i.e. 12 months). Under the Sale of Goods Directive 33 , applicable as of 2022, a seller will have to supply the consumer with software updates for a period of time which the consumer might reasonably expect so as to ensure that the product remains in conformity 34 . Nevertheless, the provision of information at the point of sale on the length of time during which a particular seller decides to provide software updates will not be required. 

2.1.3.Lack of reliable information about products’ reparability (Sub-problem 1.3)

Information on products’ reparability, such as reparability scoring, on the availability of repair services, spare parts or repair manuals of goods, is not widely available to consumers at the point of sale 35 . For example, over 80% of the respondents pointed out that it is difficult to find information on how easy it is to repair a product 36 . This is also corroborated by the results of the mystery shopping exercise carried out in the context of this Impact Assessment: information about reparability aspects such as availability of spare parts in general, period of time of availability of spare parts or certified repair services was available only in 19% of cases. Contrary to this, representatives from the industry and businesses surveyed for this Impact Assessment mostly indicated that they believed information on reparability is widely available 37 .

2.2.Problem 2: Consumers face misleading commercial practices related to the sustainability of products

Consumers are too often confronted with misleading commercial practices preventing them from taking sustainability into account in their purchases. Such practices occur at various stages of the consumption journey: during the advertising stage, the purchasing stage or during the use of the products. The following main categories of such practices have been identified in the consultations for this Impact Assessment as particularly problematic:

-Early obsolescence;

-Greenwashing;

-Non-transparent and non-credible sustainability labels, and digital information tools (e.g. mobile applications comparing the sustainability performance of selected products).

These practices have also been singled out by consumer protection authorities, for instance, in the course of the Fitness Check of EU Consumer and Marketing Law (2017) 38 or by Consumer Protection Cooperation (CPC) authorities 39  who have highlighted difficulties to carry out enforcement actions on these issues (see Section 2.3 on drivers). Further evidence justifying the selection of these practices as particularly problematic is presented below.

2.2.1.Consumers are sold products that do not last as long as they could or consumers expect (“early obsolescence”) (Sub-problem 2.1)

Early obsolescence refers to instances where a product cannot be used for the expected purpose and breaks earlier than expected 40 . Within early obsolescence, “planned obsolescence” refers specifically to a commercial policy involving deliberately planning or designing a product with a limited useful life so that it will become obsolete or non-functional after a certain period of time 41 .

Faster obsolescence of products is a growing concern for consumers. In their reply to the Open Public Consultation to support this IA, 76% of respondents (and 89% of citizens) mentioned they had experienced an unexpected failure of products in the past 3 years 42 . ICT products (47%), small household appliances (20%), clothing and footwear (19%), other electronics (18%), large household appliances (16%) and software programmes (15%) were the most often cited product categories for which unexpected failure had been experienced.

Available studies suggest that certain consumer goods are not designed to last long and/or have a shorter lifetime than would have been expected for such products in the past 43 , 44 . For example, an EU funded project, identified that a significant share of goods tend to fail right after the end of the minimum legal guarantee period (between second and third year) based on consumer reports in seven Member States 45 . Similarly, a 2015 German Study 46 concluded that the percentage of large household appliances replaced by consumers within five years due to technical defects more than doubled, from 3.5% in 2004 to 8.3% in 2012. Several other studies carried out 47 , 48 , 49  present evidence that the lifespan of some goods is becoming shorter, with technical failures being the main reason for product replacement.

Interestingly, while issues related to the failure of goods may vary depending on the characteristics of the goods, interim findings of the above mentioned EU funded project conclude that “a limited number of problem types account for four out of five failures, most of which refer to a specific part of a product, many of which appear to be shared across product categories (e.g. batteries, printed circuit boards and LCD screens)” 50 .

Another study shows that in the case of smartphones and tablets, a large proportion of the devices are being replaced after two years mostly because of a few but frequent problems: (1) the battery had stopped working and could not be replaced by the user; (2) the screen had cracked and could not be replaced by the user; or (3) the manufacturer was no longer willing or able to support the software 51 . Recently, national consumer organisations have also received more than 25 000 complaints concerning two components of a gaming console (i.e. its two controllers) which was failing prematurely and made difficult to repair or replace, rendering the console obsolete (well before the lifespan of 7 to 10 years advertised by its manufacturer) and in spite of the manufacturer being aware of the problem 52 .

Early obsolescence can thus also be linked to a limited but frequent set of practices, such as whether a component that is broken can be replaced by consumers and/or whether they are prevented/hampered in doing so by the trader, whether traders are taking sufficient and quick remedial actions when they become aware of a frequent default in one of their products etc.

On top of these cases of early obsolescence, there have also been a number high-profile cases of planned obsolescence, such as software updates having an impact on the performance of phones and accelerating their replacement, although consumers were not informed thereof 53 .It is important to note, however, that a number of manufacturers/retailers argue that planned obsolescence does not exist as a practice and that shorter lifespans are impacted by consumer behaviour such as poor maintenance and increased use.

2.2.2.Consumers are faced with the practice of making unclear or not well-substantiated environmental claims (‘greenwashing’) (Sub-problem 2.2)

Environmental (“green”) claims are defined as: the practice of suggesting or otherwise creating the impression (in a commercial communication, marketing or advertising) that a good or a service has a positive or no impact on the environment or is less damaging to the environment than competing goods or services. 54 Green claims can be explicit (for instance, highlight the savings in greenhouse gas emissions due to a change of packaging), general (statements such as “green” product, “good for the environment” etc.) or even implicit (e.g. use of the colour green, certain images etc.). Whether a green claim can be said to have been made would therefore often require a concrete assessment on a case-by-case basis. A green claim can be made using a label or otherwise. Therefore, the options considered to combat certain types of misleading green claims, whether in this initiative or in the forthcoming complementary Green Claims Initiative, would apply to labels insofar as those labels make a green claim of the type in question. A further specific problem relating to sustainability labels will be addressed in section 2.2.3 below. A recent Commission study on environmental claims found that 80% of webshops, webpages and advertisements surveyed contained green claims 55 . 45% of the total were implicit claims (imagery and colours suggesting environmental benefit), 35% were explicit claims (logos, labels and textual claims) and 21% were vague, general claims. Such a high prevalence was also identified in the mystery shopping carried out for this Impact Assessment 56 . 

The aforementioned study assessed 150 environmental claims and found that a considerable share (53.3%) of them provide vague, misleading or unfounded information on products’ environmental characteristics across the EU and in a wide range of product groups (both in advertisement as well as on the product). These results have also been confirmed by the outcome of a recent “sweep” 57 carried out by the Consumer Protection Cooperation authorities 58 . Out of the 344 sustainability claims assessed throughout November 2020, authorities had at least a reasonable doubt that the claim may be false or deceptive in almost half of the cases (42%), and therefore that these could potentially amount to an unfair commercial practice under the UCPD. CPC authorities considered that in more than half of the cases (57.5%), the trader did not provide sufficient elements allowing for a judgement about the claim’s accuracy. In many cases, authorities had difficulties identifying whether the claim covered the whole product or only one of its components (50%), whether it referred to the company or only certain products (36%) and which stage of the product’s lifecycle it covered (75%). 37% of the claims included vague statements (such as “green”, “nature’s friend”) likely to deceive consumers.

Most stakeholders consulted for this Impact Assessment agreed that greenwashing is a problem, with the noticeable exception of industry representatives. The results of the stakeholder consultations on the potential future use of the Product Environmental Footprint (PEF) and Organisation Environmental Footprint (OEF) methods 59 show that 56% of respondents have already encountered misleading green claims.

2.2.3.Consumers are faced with the use of sustainability labels and digital information tools that are not always transparent and credible (Sub-problem 2.3)

Sustainability labels are considered in this Impact Assessment as any voluntary “trust mark, quality mark or equivalent” 60  that aims to set apart and promote a product, a process or a business with reference to environmental, social or ethical aspects. These labels are developed by a wide array of bodies, organisations, legal or private entities (including public bodies, industry associations, for-profit as well as non-profit organisations, individually or in partnership). They can usually be found directly on products and in communication materials. Ecolabels are those sustainability labels which aim to set apart and promote a product, a process or a business with reference to environmental aspects in particular.

Digital information tools, in the context of this Impact Assessment, are software tools which have as their primary purpose to provide information to consumers on the sustainability of products with respect to environmental, social or ethical aspects.

Both sustainability labels and digital information tools are used to promote products to consumers which are more sustainable, by providing information on their performance with respect to environmental as well as social and ethical aspects 61 .

Numerous voluntary labels have as a stated objective to guide consumers towards more sustainable choices. There were around 230 ecolabels active in Europe in 2020 of which 48% cover some social attributes 62 . 901 labelling schemes have been identified across Europe in the food area 63 , and there have been 100 private green energy labels mapped in the EU. 64   However, many labels are subject to different levels of robustness, supervision and transparency 65  , which may raise questions about their reliability. Sustainability labels can be distinguished according to their governance model: those that are run by third party certification schemes, whose role is to ensure that companies wishing to use the labels will abide by a set of specific criteria (these certification schemes can be public, private, or non-profit); and those based on “self-declarations” not verified by any third party 66 . Consumers appear not to be aware of such distinction. 67

This proliferation of labels combined with their varied governance models implies that producers and retailers can apply a variety of strategies in opting for a specific sustainability label. Very often, this also translates into companies displaying various labels to vouch for the sustainability of their products. Interestingly, during the consultation conducted for this Impact Assessment, industry representatives were more likely to identify the proliferation of sustainability labels as a problem compared to consumers and their representatives.

The analysis carried out in preparation for this Impact Assessment shows shortcomings as to the transparency of labels. For 27% of the labels examined, the standards/criteria which the label is meant to guarantee were not available online. 16% of labels did not disclose their conformity assessment method. The type of managing authority and the result of the assessment were also often not disclosed. Only 17% of labels indicated providing for a dispute settlement or appeal mechanism with regards to the accuracy of the information certified by the label.

In addition, other evidence points to the problem of credibility of labels. For instance, only 35% of the labels analysed for this Impact Assessment required specific metrics or data to substantiate their compliance with the criteria. A previous analysis showed a higher level of compliance with a set of principles by labels relying on a certification scheme compared to those based on “self-declaration” 68 . However, some shortcomings have also been identified in relation to certification schemes. Some of those that have been examined have no or limited information on their supervisory structure, on how their requirements are developed or on how certification and inspections actually occur.

According to the stakeholder consultations, the “proliferation of non-transparent online information tools that are providing information/comparisons on the sustainability performance of products” was identified as an obstacle to enhanced consumer participation in the circular economy by 11% of consumers 69 . It therefore does not seem to be considered as equally important a problem as labels. This could, however, change in the future, as such digital information tools are likely to become more and more important in influencing consumers’ behaviour due to the increased digitalisation of society.

2.3.What are the problem drivers?

The drivers behind these problems have been identified as market failure, as well as an insufficiently adapted regulatory framework. 70 The impact of these drivers on each of the problems and sub-problems identified is presented in Figure 1 below. It also outlines the consequences of each of the sub-problems for consumers, for the market and the environment, which are presented in more detail in Annex 12, as well as the specific and general objectives of the initiative, which are discussed further in Section 4.

Figure 1.Problem tree

71 72 73 74 As can be seen from this problem tree, in relation to Problem 1 specifically (Consumers lack reliable information at the point of sale to make environmentally sustainable consumption choices), one driver is that there are insufficient incentives for companies to provide consumers with reliable information on the environmental characteristics, lifespans, and reparability of their products unless the expected benefits in terms of increased demand outweigh the costs of providing that information. A second driver is that under existing EU instruments, making information on products’ environmental sustainability available is voluntary and/or limited to certain product categories and/or features,. In absence of common rules, this leads to different levels of protection of consumer rights among Member States when certain Member States would start regulating while others not. The EU’s general consumer protection rules (namely the Unfair Commercial Practices Directive 2005/29/EC - UCPD and the Consumer Rights Directive 2011/83/EU - CRD) generally require traders to provide consumers with information that they need in order to make an informed, independent transactional decision. These rules, however, do not specifically require the provision of reliable information about products’ environmental characteristics, lifespan or reparability.

In relation to Problem 2 (Consumers face misleading commercial practices related to the sustainability of products), one driver is that manufacturers and sellers have economic incentives to manufacture and sell goods with lifespans that are shorter than they could realistically be able to achieve, so that they can reduce their costs or sell new or replacement goods to consumers 75 . Furthermore, concerning greenwashing, the increased interest of consumers in environmentally sustainable products provides an incentive to market products as environmentally friendly to gain a competitive advantage (or at least not to put oneself at a disadvantage). A second driver is the lack of precision of the EU consumer legal framework, making it difficult for national authorities to address the aforementioned issues effectively. The consumer legal framework also does not allow Member States to adopt stricter consumer protection rules given its full-harmonisation character. The UCPD, for instance, does not provide specific rules on environmental claims. The general provisions of the UCPD also apply where traders present environmental claims in ways that are unfair to consumers 76 . However, in the absence of more specific provisions, its principle-based approach requires a case-by-case assessment from enforcers including of the negative impact of the misleading practice on the integrity of the consumers’ transactional decision.

2.4.How will the problems evolve without intervention?

Without the intervention of this initiative, the evolution of the problems and their drivers will depend on the interaction between various forces, including:

-the evolution of the interest of consumers in sustainable products;

-the trends regarding private incentives to provide information on the environmental characteristics, durability and reparability of products and incentives to fight greenwashing, early obsolescence and unreliable or non-transparent sustainability labels and information tools;

-national initiatives and EU-level related initiatives that attempt to address the identified problems. The potential impact on the evolution of the problem of two EU initiatives in particular currently under preparation (the upcoming Green Claims Initiative and the Sustainable Products Initiative adopted together with this initiative) discussed in Section 5 below when analysing the baseline from which the options considered are to be assessed.

Member States are likely to continue to unilaterally adopt options to provide consumers with environmental sustainability information and to address more directly the problematic practices identified in this Impact Assessment (see Annex 6). For instance, France’s Circular Economy Law, introduced in 2020, obliges producers, importers, distributors or any other person placing electrical and electronic products on the market to provide the reparability index of their product to sellers of their products or any other person requesting it. The aim is to inform consumers about the ability to repair five groups of products (televisions, smartphones, laptops, lawnmowers and washing machine). To take an example of a legislative proposal currently under consideration, in July 2020, Italy tabled a proposal which would define and ban the practice of planned obsolescence and introduce criminal sanctions for the producer or distributor of goods who mislead the consumers on a number of issues including planned obsolescence.

The interest of consumers in sustainable products is expected to increase. With this increase it is expected that the incentives of companies to provide consumers with information on the sustainability of their products will also increase and so will the share of products with information on their environmental characteristics. This will, on the one hand, reduce the extent of problem 1.1 (lack of reliable information on environmental characteristics of products), but this could potentially increase the incentives to adopt greenwashing practices and to develop or use sustainability labels that are not fully transparent and credible and so exacerbate problems 2.2 and 2.3. Digitalisation is also likely to lead to an increase of “sustainability apps” aimed at comparing products based on their sustainability parameters. The number of sustainability labels may stagnate given their already high number, but the number of one-brand sustainability labels may still increase. This will lead to an increase of the extent and consequences of the problem, including an increased mistrust of consumers on sustainability labels and a reduction of their effectiveness in shifting consumption towards more sustainable products.

The increase in the market share of sustainable products will compensate for the total increase in consumption and is expected to lead to a reduction of the overall environmental footprint of private consumption. However, the effective reduction of environmental impacts will depend on whether the information regarding the sustainability of the product is reliable or not. Without further regulatory intervention at national or EU level, this reduction may actually be limited because, as mentioned above, the incentives for companies to practice greenwashing could increase as demand for sustainable products rises. Because of these opposite forces, only a limited reduction of environmental impacts is expected.

3.Why should the EU act?

3.1.Legal basis

The EU exercises a shared competence with Member States in the area of consumer policy. As stipulated in Article 169 of the Treaty on the Functioning of the European Union (TFEU), the EU shall contribute, inter alia, to protecting the economic interests of consumers as well as to promoting their right to information and education in order to safeguard their interests. Possible legislative action to be taken in relation to the problems analysed in this IA would be based on Article 114 TFEU, which requires the Commission to take as a base a high level of consumer protection in the context of the completion of the internal market, in conjunction with Article 169 TFEU. In addition to pursuing internal market and consumer protection objectives, the proposal will also pursue a high level of environmental protection, by unlocking opportunities for the circular, clean and green economy. However, internal market and consumer protection objectives are predominant and the environmental benefits are complementary. Therefore it is appropriate to use Article 114 TFEU and Article 169 TFEU as the legal basis.

3.2.Subsidiarity: Necessity of EU action

The problems analysed in this impact assessment are widespread and have a Union-wide character with the same drivers across the EU. All European consumers lack the necessary information to make more sustainable choices and are faced with the same problematic practices. As the problems identified affect all European consumers, only action taken at EU level will be effective. Other factors which make EU action necessary are the volume of B2C cross-border trade in the EU, as well as the fact that Member States 77 are starting to address the problems identified in this impact assessment unilaterally.

In the absence of EU-level action, these national initiatives, while bringing certain benefits to consumers and the environment at the national level, could further intensify and lead to a fragmentation of the Single Market, bringing in turn legal uncertainty and raising compliance costs. Indeed, the size and intensity of cross-border trade are high enough to make such economic activity in the Single Market extremely vulnerable to inconsistent or even merely divergent policy choices by Member States.

The UCPD provides, in principle, fully harmonised rules regarding unfair commercial practices harming consumers' economic interests. The CRD provides fully harmonised rules concerning pre-contractual information requirements in distance and off-premises sales. Therefore, depending on circumstances, new legislative action at national level within the scope of these Directives could go against the fully harmonised acquis that is already in place.

Widespread infringements of consumer rights have now been legally defined by the revised CPC Regulation 78 , which provides a powerful procedural framework for cooperation between national enforcers in this respect. But, to be fully effective, enforcement across the EU must also be grounded in a common and uniform substantive law framework. In other words, to be fully effective, the EU consumer acquis must more clearly define which greenwashing and obsolescence practices should be considered as unfair.

Feedback of stakeholders on the Inception Impact Assessment shows a particularly strong support for EU action capable of bringing about a common approach to the provision of sustainability information to consumers and to limit the proliferation of labels and misleading green claims on the Single Market, for instance.

3.3.Subsidiarity: Added value of EU action 

The 2017 Fitness Check of the Consumer and Marketing Law as well as the evaluation of the Consumer Rights Directive confirmed that the horizontal EU consumer and marketing law acquis has contributed towards a high level of consumer protection across the EU. It has also ensured a better functioning internal market and helped to reduce costs for businesses offering goods and services cross-border 79 . As this initiative aims at completing this acquis to address problems that have become more acute with the green transition, and to render its enforcement more effective, it is also expected to achieve the same added-value.

EU action can ensure that consumers have the same environmental sustainability information across the Single Market which will help them to make informed purchasing choices, thus reducing the risk of a legal fragmentation of the Single Market and the consequences that this would entail for cross-border trade and consumer protection. This initiative would also alleviate the difficulties faced by national authorities in enforcing the existing principle-based provisions of the UCPD in such complex areas as misleading green claims and obsolescence practices. By specifying further when and how such practices would qualify as unfair, it would increase the effectiveness of consumer protection within the EU.

By building in a targeted way on the EU consumer law acquis, this initiative will also rely on the full spectrum of enforcement mechanisms, as strengthened under the Better enforcement and modernisation Directive 80 , the Representative Actions Directive 81  and the revised CPC Regulation 82 .

This initiative will cover only the aspects that Member States cannot achieve on their own and where the administrative burden and costs are commensurate with the specific and general objectives to be achieved. Proportionality will be carefully designed in terms of scope and intensity and using qualitative and quantitative assessment criteria to ensure that the options considered will cover all relevant stakeholders, but will be tailored to the needs they must address. None of the options analysed in this impact assessment goes beyond what is necessary to achieve the objectives set in the following section.

4.Objectives: What is to be achieved?

4.1.General objectives

The general objectives of the policy options discussed in this Impact Assessment flow from the Treaties, the Charter of Fundamental Rights and the commitments taken by the EU to tackle climate and environmental-related challenges 83 :  

-Ensure a smooth functioning of the Single Market, for the benefit of both consumers and traders (Article 114 TFEU, 169 TFEU).

-Foster the role of consumption in achieving the EU’s climate goals and protecting the environment;

4.2.Specific objectives

The specific objectives are to:

-Enable informed purchasing decisions by consumers to foster sustainable consumption. This addresses Problem 1.

-Eliminate practices that mislead consumers away from sustainable consumption choices. This addresses Problem 2.

-Ensure a better and coherent application of the EU legal framework thanks to clearer and more enforceable rules. This addresses both problems. Coherent application of EU rules is indeed necessary to ensure effective consumer protection and a level-playing field for businesses within the Single Market.

To allow for a more granular assessment of the effectiveness of the various options to be presented in Section 5 in meeting these three specific objectives, these objectives will be further broken down into 6 criteria, as shown in Annex 9. Each option’s impacts will be measured against (1) the quality of consumer decision making, (2) circularity and sustainable consumption, (3) consumer protection, (4) consumer trust, (5) level playing field and (6) the application of the EU legal framework.

5.What are the available policy options?

5.1.What is the baseline from which options are assessed?

The baseline (Option 0 as presented in the MCA in Annex 9) does not involve the introduction of any new regulatory measures under consumer policy at EU level.

As regards Problem 1 (Consumers lack reliable information at the point of sale to make environmentally sustainable consumption choices), the extent of the problem and its consequences is expected to remain constant for most of the EU27 countries and to improve for some products in a few Member States that are/will try to address the problem with national legislation, as identified in Annex 6. The Consumer Rights Directive requires traders to provide consumers with information on, among others, the main characteristics of the goods or services. It includes specific information requirements about the existence of the legal guarantee of conformity, as well as additional commercial guarantees when provided on a voluntary basis. While the Sale of Goods Directive promotes durability of products through the legal guarantee, it only provides rights to the consumers during the minimum two-year legal guarantee period. The incentives to provide commercial guarantees included in the product price and with longer duration are not expected to change. Regarding the provision of software updates, while the application of national transposition rules of the Sale of Goods Directive from 2022 will help to ensure that consumers are supplied with software updates so that a product remains in conformity for a period of time which the consumer might reasonably expect, the comparability of product at the point of sale based on the availability of software updates will not be addressed, and is therefore expected to remain an issue.

The incentives to provide information to consumers on expected/estimated lifespan are also not expected to change significantly for most products. While important new reparability requirements under Ecodesign came into force in March 2021 for a number of product categories (including more information in user manuals) 84 , they will not address specifically the information that consumers are provided by traders on products’ reparability at the point of sale, and certainly not for all products categories.

As regards Problem 2 (Consumers face misleading commercial practices related to the sustainability of products), the risk of an increase in the share of products employing these practices is expected to grow, as the environmental sustainability of products is an aspect being valued by an increasing number of consumers. The general provisions of the Unfair Commercial Practices Directive on misleading practices can be used to apply also to planned obsolescence cases when they negatively affect consumers on the basis of a case-by-case assessment. There are no specific provisions in this area in the Directive or in its Annex I (blacklist) which sets out practices regarded as unfair under all circumstances. The lack of more specific rules and the need for case-by-case assessment of the effects of the practice on the consumers makes it difficult to enforce the UCPD in this area. Some minor changes are expected to the extent of this problem due to new legal actions at the national level under existing European consumer legal framework. 85

The general provisions of the Unfair Commercial Practices Directive apply also to greenwashing practices when those are misleading and negatively affect consumers on the basis of a case-by-case assessment. There are no specific provisions in this area in the Directive or in its Annex I (blacklist) which sets out practices regarded as unfair in all circumstances. The recent CPC screening of websites for ‘greenwashing’ 86 , confirmed that there is a need for strengthening the legal framework to facilitate enforcement in this area. In the short term, the European Commission will further develop the guidance on the application of the UCPD to support Member States in this area. Some Member States are increasing efforts to stop these practices and may launch further enforcement cases. However, these will not help to address the drivers identified in section 2.3. The number of digital information tools (e.g. apps) to compare the sustainability performance of products may grow in a more and more digitalised world.

When considering the baseline from which the options to be presented below are assessed, however, it is important to highlight at this stage two other EU-level initiatives under preparation which, while failing to adequately address the sub-problems identified in this report, will nonetheless complement the preferred policy options presented, namely the upcoming Green Claims Initiative and the Sustainable Products Initiative (adopted together with this initiative).

These two initiatives and the one subject to this Impact Assessment are prepared in parallel and in close coordination to ensure their complementarity. However, notwithstanding this close coordination, the three initiatives are nonetheless separate, and while the policy options of the Green Claims Initiative and the Sustainable Products Initiative have been taken into account in the policy options (in relation to “information at the point of sale” and “misleading practices”) assessed in this Impact Assessment, it cannot be guaranteed that each of these other initiatives will be adopted and will become EU law, which is pending the upcoming ordinary legislative procedure. The baseline for this initiative (Option 0 as presented in the MCA in Annex 9), as well as the impacts of the policy options (presented in Section 6) against this baseline, were therefore calculated without taking into account any potential overlap of the impacts of these initiatives. 87

To the extent that the options considered in this Impact Assessment overlap with the preferred policy options of these initiatives, this has been taken into account in a qualitative way in the description of the options presented in Section 5.2 below for each of the 6 sub-problems individually. The SPI could set requirements for information to be provided in relation to specific products or groups of products with the exact requirements depending on the characteristics of the relevant product(s). One possibility would be to have a machine readable symbol such as a QR code that links to a digital product passport attached to the product. The exact timeline for the implementation of any product specific information requirements under the SPI is not foreseeable, due to the fact that these would be introduced progressively through subsequent product measures. 88

Complementary to the initiative subject to this Impact Assessment, a self-regulatory initiative has been announced in the New Consumer Agenda, which was launched in January 2021. The voluntary EU Green Consumption Pledge requires participating companies to take actions in support of sustainable consumption beyond what is required by law. 89   It calls upon businesses in various sectors of the economy to undertake concrete, public and verifiable commitments, on a voluntary basis, to reduce their overall carbon footprint, to produce and market more sustainable products and to redouble their efforts towards raising the awareness of consumers about the impact of their consumption choices. So far, 11 companies have come forward (including two SMEs), as part of the pilot phase: they represent various sectors in the manufacturing and retail world, but also financial services and energy supply. The pilot phase of the Green Consumption Pledge will be completed by 2022, including an evaluation of the functioning of the Pledge. 

5.2.Description of the policy options

The policy options were established by the Commission in close cooperation with all relevant groups of stakeholders. Stakeholder opinion on possible options was sought at various stages of the development of the Impact Assessment 90 . As a follow-up to these consultations and progress made in the development of the Impact Assessment, the main options included in the Inception Impact Assessment have been further developed and refined. Rather than focusing on the legal technique – which was the main differentiating factor in the three options outlined in the IIA – the options outlined in this Impact Assessment focus on policy solutions for each of the individual sub-problems identified. Such an approach also allows to ensure complementarity with the ongoing work on the Green Claims and SPI initiatives referenced in section 5.1. This complementarity is further outlined below in the description of the baseline from which each of the options presented are assessed. For a number of sub-problems identified, options were discarded at an early stage and are not presented in the tables below. These discarded options are presented in Annex 11.

Regarding the product scope analysed for Problem 1 (Consumers lack reliable information at the point of sale to make environmentally sustainable consumption choices), four different potential product scopes were considered. These were narrow product scope (i.e. all goods with digital content), medium product scope (i.e. all energy-using goods), wide product scope (i.e. all goods with assembled parts that move relative to one another, e.g., most furniture, some suitcases, some non-energy using toys, bicycles, etc.), and very wide product scope (i.e. all consumer goods except consumables and fast moving ones, e.g. cloths, pans, bed linen). Evidence regarding the existence of the problem of limited durability and reparability, consumer expectations concerning the durability and reparability of goods (beyond the legal guarantee period), and consumer interest in receiving information on these aspects, is mostly available for the medium product scope (i.e. energy-using products); for the remaining types of products far less evidence is available. Furthermore, the availability of evidence can be considered a proxy for the size of the problem (and of the expected benefits if addressed) for the various product groups as it is reasonable to expect that research tends to focus on the most relevant problems/product categories. For this reason, while the available evidence allows for robust conclusions on the benefits of possible measures (to address sub-problem 1.2 and sub-problem 1.3) for the medium product scope, it is insufficient to soundly confirm them for a wider product scope. A detailed analysis of this assessment can be found in Annex 13. Concerning option 1.3.E in particular, no product scope was defined as this option is designed to apply wherever the information in question is made available by the manufacturer or required to be made available under applicable EU or national law, regardless of the product in question.

As regards Problem 2 (Consumers face misleading commercial practices related to the sustainability of products), no specific product scope was analysed, as these practices and the options considered to address them apply regardless of product type.

In order to facilitate decision-making as regards the preferred combination of policy options, the options considered to address each of the individual sub-problems under Problem 1 and Problem 2 are structured in a way that their impacts can be easily compared, and that one preferred policy option can therefore be chosen to address each sub-problem. This allows, for each sub-problem, the option with the most positive impact to be chosen as the preferred policy option. The considerations regarding the delineation of the particular policy options for each individual sub-problem is further specified below for each sub-problem in turn.

5.2.1.Problem 1: Consumers lack reliable information at the point of sale to make environmentally sustainable consumption choices

5.2.1.1. Sub-problem 1.1: Lack of reliable information about products’ environmental characteristics

For this sub-problem, a number of options have been discarded at an early stage, as their added value could not be demonstrated if taken via a horizontal consumer law instrument. These options are the following: an obligation to inform on product’s environmental characteristics for all consumer products (goods and services), an obligation to warn on products with high negative impacts on the environment, an obligation to warn when there is “no proof” of good environmental performance of the product, and an obligation to inform on one single key environmental characteristic, i.e. related to climate change. Further details of these options and the reasons for discarding them is provided in Annex 11. In general, environmental characteristics of products are always specific to product groups. Depending on the product group, the relevant information on environmental characteristics to be provided at the point of sale differs significantly. For these reasons, it was concluded that a horizontal consumer law instrument would not be the appropriate place to introduce such requirements. Furthermore, the extent of this sub-problem as described in section 2.1.1 is expected to reduce significantly due to measures taken under the upcoming Green Claims Initiative and the SPI initiative. The Green Claims Initiative aims to provide a common framework for those companies wishing to provide information on the environmental characteristics of their products. In the future, the SPI initiative, future eco-design information requirements and mandatory EU labelling schemes (e.g. EU energy label) will address this problem by requiring mandatory information on certain environmental characteristics be provided for various product categories. As a result no options will be selected to address this particular sub-problem as part of this Impact Assessment.

5.2.1.2. Sub-problem 1.2: Lack of reliable information about products’ lifespan 

What are the options considered in order to address this sub-problem?

While the three options presented below to address this sub-problem are not mutually exclusive, they are not considered in combination as this would entail significant duplication of impacts. The purpose of the division into three distinct policy options is to calculate the impacts of the options as accurately as possible, and thus to facilitate a decision regarding the preferred policy option.

How do these options interact with the other initiatives in preparation?
Under the Sustainable Products Initiative, specific information requirements on the expected/estimated durability for specific product categories may become available, when considered feasible and appropriate, subject to future Impact Assessments of delegated acts (under the framework legislation) and further technical work (see sub-option 4a in the Impact Assessment for the Sustainable Products Initiative). This information could furthermore be made available to consumers in the form of a Digital Product Passport (see sub-option 4b of the Impact Assessment for the Sustainable Products Initiative). As such measures would not specifically require the information to be presented in a clear and legible way at the point of sale, and would be implemented gradually and by product category, the extent of the problem and its consequences is expected to remain unchanged for many products.

5.2.1.3. Sub-problem 1.3: Lack of reliable information about products’ reparability

What are the options considered in order to address this sub-problem?

The structure followed by the presentation of the options for this sub-problem is as follows: Options 1.3.A, 1.3.B., 1.3.C and 1.3.D are all complementary, while option 1.3.E entails a combination of 1.3.A, 1.3.B, 1.3.C and 1.3.D with slight modifications. The purpose of the division into five distinct policy options is to calculate the impacts of the options as accurately as possible, and thus to facilitate a decision regarding the preferred policy option.

How do these options interact with the other initiatives in preparation?
Under the Sustainable Products Initiative, specific information requirements on specific product categories may become available, when considered feasible and appropriate, subject to future Impact Assessments of delegated acts (under the framework legislation) and further standardisation work (see sub-option 4a of the Impact Assessment for the Sustainable Products Initiative). This information could furthermore be made available to consumers in the form of a Digital Product Passport (see sub-option 4b of the Impact Assessment for the Sustainable Products Initiative). As such measures would not specifically require the information to be presented in a clear and legible way at the point of sale, and would be implemented gradually and by product category, the extent of the problem and its consequences is expected to remain unchanged for most products.

5.2.2.Problem 2: Consumers face misleading commercial practices related to the sustainability of products

5.2.2.1. Sub-problem 2.1: Consumers are sold products that do not last as long as they could and consumers expect

What are the options considered in order to address this sub-problem?

While the two options presented below to address this sub-problem are not mutually exclusive, they are not considered in combination as this would entail significant duplication of impacts. The purpose of the division into two distinct policy options is to calculate the impacts of the options as accurately as possible, and thus to facilitate a decision regarding the preferred policy option.

How do these option interact with other initiatives in preparation?
Some changes are expected regarding the extent of the problem and its consequences thanks to the improvements concerning the durability of some products (or some of the product components) and their reparability as a consequence of the Sustainable Products Initiative, when considered feasible and appropriate, subject to future Impact Assessments of delegated acts and further technical work (see sub-option 3a in the Impact Assessment for the Sustainable Products Initiative). As such measures would be implemented gradually and by product category, the extent of the problem and its consequences is expected to remain unchanged for most products.

Options discarded at an early stage
Further to the options considered above, for this sub-problem the following options were discarded at an early stage as their added value could not be demonstrated: a general ban of planned/intentional/deliberate obsolescence 102 , and setting minimum lifetimes per product category. Additional details of the content of these discarded options and the reasons for discarding them is provided in Annex 11.

5.2.2.2. Sub-problem 2.2: Consumers are faced with the practice of making unclear or not well-substantiated green claims (“Greenwashing”)

What are the options considered in order to address this sub-problem?

The options 2.2.A and 2.2B presented below to address this sub-problem are complementary. Option 2.2.C entails a combination of options 2.2A and 2.2.B. The purpose of the division into three distinct options is to calculate the impacts of the options as accurately as possible, and thus to facilitate a decision regarding the preferred policy option.

How do the options interact with other initiatives in preparation
The problem will be jointly addressed with the upcoming Green Claims Initiative which will help to regulate the market for environmental claims on products and organisations when made both by businesses towards consumers and by businesses towards other businesses. This initiative would establish methodological requirements on how environmental claims are communicated and substantiated.  

Options discarded at an early stage
Further to the options considered above, for this sub-problem the following option was discarded at an early stage, as its added value could not be demonstrated: a pre-approval of environmental claims via an EU body. Additional details of the content of this option and the reason for discarding it is provided in Annex 11.

5.2.2.3. Sub-problem 2.3: Consumers are faced with the use of sustainability labels and digital information tools that are not always transparent and credible

What are the options considered in order to address this sub-problem?

The three options presented below are mutually exclusive.

How do these options interact with other initiatives in preparation?
Under the Green Claims Initiative several policy options in relation to possible requirements for environmental claims, including ecolabels are being considered. . As lex generalis, this initiative will provide for general consumer protection rules that will be complemented by other EU-level technical or sector-specific instruments (lex specialis), when they provide for more detailed rules. The Green Claims Initiative is such a lex specialis technical instrument.

6.What are the impacts of the policy options and how do they compare?

The 16 impacts against which the policy options are assessed have been selected in line with the Better Regulation Guidelines and guided by the problem tree in Figure 1. The assessment is predominantly qualitative and complemented, when and where possible, by a quantitative assessment, which relies on estimates gathered from the literature review, stakeholder consultations and modelling work. The process for selecting the impacts and the methodology underpinning the quantitative assessment is explained in Annex 4. The appraisal period of 2025-2040 was selected as it was estimated that the measures would come into force in 2025. The standard appraisal period in which to measure the impacts of such policy measures is 15 years, in line with the Better Regulation guidelines. All monetised costs and benefits of each measure considered in the assessment are incremental to those of the baseline, which is therefore assigned EUR 0 for these impact categories. As many of the impacts are not monetisable, it was decided to conduct a multi-criteria analysis (MCA) complemented by a (partial) Cost-Benefit Analysis. The MCA includes three high-level assessment criteria: Effectiveness, Efficiency and Coherence. Each of the identified 16 impacts is a sub-criterion of one of those three high-level criteria. Detailed analyses presenting the results of the assessment of each policy option per sub-criteria can be found in Annex 8. To carry out the MCA, weights have been assigned to the criteria/sub-criteria. Furthermore, a sensitivity analysis was carried out using various weight combinations, including a default scenario and a worst case scenario 106 . The full results of the MCA, sensitivity analysis and partial CBA can be found in Annex 9, including additional details on the methodology used.

For ease of reading, the following sub-sections summarise the results of the assessment and presents them per stakeholder groups affected. The table below recaps the 16 impacts against which the options were assessed and link them with the three-high level assessment criteria they fall under as well as the stakeholders they concern directly. The values presented for monetised consumer welfare, climate change and costs are the average of those of the scenarios analysed for each measure in the preparatory study.

As explained in section 5.1 above, when considering the baseline for this initiative, as well as when calculating the impacts of the options presented below against this baseline, the impacts of two other EU-level initiatives under preparation, the upcoming Green Claims Initiative and the Sustainable Products Initiative, have not been taken into account in a quantitative way, as it cannot be guaranteed that each of these other initiatives will be adopted and will become EU law, which is pending the upcoming ordinary legislative procedure.

It cannot therefore be excluded that, pending the implementation of some of the measures considered in these other initiatives currently being prepared in parallel, the impacts calculated below might be subject to change.

However, to the extent that the options considered in this Impact Assessment overlap with the preferred policy options of these two other initiatives, this has been taken into account in a qualitative way in the description of the options presented in Section 5.1 above, as well as in the discussion of the proportionality of the preferred options in Section 7 below.

6.1.Problem 1: Consumers lack reliable information at the point of sale to make environmentally sustainable consumption choices

6.1.1.Sub-Problem 1.2: Lack of reliable information about products’ lifespan

Impacts of the policy options

Impacts on consumers:

As explained in Annex 12, consumers are interested in having information about the lifespan/durability of products and are even willing to pay for it. However, the obligation to inform consumers about the expected lifespan of goods, as considered in option 1.2.A will not improve the quality of decision-making for consumers. This is because the reliability of the information provided under this option (and the comparability it would allow between products) will depend on the methodology used by companies to assess such an expected lifetime, which are likely to vary depending on the companies, therefore leading to diverging assessments within a given product category. It is also technically very challenging to estimate the lifespan of products, and the methods, indicators and techniques used will vary significantly from product category to product category. Depending on the level of effectiveness of the option in contributing to consumers purchasing alternatives that last one year longer than in the baseline, the monetisable consumer welfare is estimated to be around EUR 850 - 1 110 million for the period 2025-2040 if the information is reliable (or EUR 57 – 74 million per year). It could, however, become negative if each company decides on its own methodology. The availability of a commercial guarantee of durability signals that the respective product is of high-quality and expected to last longer. The provision of information about the existence and length of the commercial guarantee of durability as considered in option 1.2.B would avoid the technical challenge posed by the previous option of needing to assess the expected lifespan of a product, while serving as an excellent proxy for consumers to identify which products are expected to have a longer lifespan. This would avoid the technical and methodological challenges posed by the previous option of needing to assess the expected lifespan of a product. Simulations carried out for the purpose of this Impact Assessment show that, in the medium term, the share of products covered by commercial guarantees and the duration of the commercial guarantees will increase as a result of the option. The option is estimated to bring an increase of monetisable consumer welfare of EUR 1 775 – 2 465 million for the period 2025-2040 (or EUR 118 – 164 million per year). Option 1.2.C, namely option 1.2.B plus the obligation to inform consumers on the period of time during which free software updates will be provided, would (in addition to the impacts described for option 1.2.B) allow consumers to identify which products offer better conditions in terms of availability of software updates and therefore improve their decision-making process. This would be complementary to the seller’s obligations under the Sale of Goods Directive to supply the consumer with software updates for a period of time which the consumer might reasonably expect so as to ensure that the product remains in conformity. Under this option, consumers will experience a “gain”, which according to the partial calculations carried out by the supporting study is likely to be around EUR 2 355 – 3 555 million for the period 2025-2040 (or EUR 157 – 237 million per year). To address possible information overload, this information on software updates should be only provided in absence of a commercial guarantee of durability (which will cover software updates), unless the software updates are provided for a longer time than the commercial guarantee of durability.

Impacts on businesses:

Option 1.2.A will have a significant administrative burden on businesses, related to the production of new data to be able to provide information on the expected lifespan of products and, to a lesser extent, the tagging of the product. Business organisations have pointed to the high cost of this obligation during the consultation phase. While the obligation is on the seller, it is assumed that the seller will request this information from manufacturers. These extra costs are estimated to amount to EUR 2 435 – 2 680 million for the period 2025-2040 (or EUR 162 – 179 million per year). Option 1.2.B will impose relatively high one-off administrative burdens on businesses, primarily sellers, mostly related to adapting systems, procedures and existing data (e.g. updating websites) and to replacing price tags in physical shops (e.g. on shelves). However, it will have low recurrent administrative burdens as the activities necessary to provide the information would have been carried out in a business-as-usual scenario. These extra costs are estimated to be between EUR 890 – 1 065 million for the period 2025-2040 (or EUR 59 – 71 million per year) and would fall largely on sellers, as they are mainly linked to the display of the required information. These costs are expected to be compensated by an increase in the price of products offering a commercial guarantee (as consumers are willing to pay for longer commercial guarantees) and possibly by an increase in demand of those same products. This option will systematically increase transparency regarding the commercial guarantee offered for goods and penalise companies that do not offer or offer less attractive commercial guarantees, so contributing to a level playing field. Option 1.2.C is expected to have some further positive impact on a level-playing field as it will increase transparency about commitments regarding software update and allow consumers to compare products based on these commitments. However, the option will have costs for manufacturers as they need to decide on the period during which they will provide software updates, and communicate them to sellers. Sellers will then have costs to ensure that consumers receive this information at the point of sale. These extra costs are estimated to be between EUR 990 – 1 170 million for the period 2025-2040 (or EUR 66 – 78 million per year).

Impacts on public administrations:

Enforcement costs for option 1.2.A are estimated to be between EUR 86 - 96 million for the period 2025-2040 (or EUR 5.7 – 6.4 million per year). These costs will be generated by the time and expertise needed to check the information provided by businesses, which will be particularly challenging and time-consuming in the absence of common standards/methodologies. Based on interviews with national enforcement authorities, it is assumed that Member States (possibly with the exception of France) would have to create a dedicated team to enforce this measure. The size of the team would be around 5 experts. 25% of their time would be dedicated to monitoring the compliance with the measure, 50% would be to carry out inspections and 25% with handling complaints. It is estimated that the number of complaints that can be handled given the available resources will be around 700 per year per Member State (average as some will handle significantly more and others significantly less). It is assumed that about 1% will be dealt with through Alternative Dispute Resolution bodies and 0.1% in courts. The costs of an ADR body adjudication and of a court adjudication were obtained from the Impact Assessment of the review of the Consumer Protection Cooperation Regulation and supporting study 108 . 140h are assumed for familiarisation with the measure and adjustment of internal procedures to start enforcing the measure. 16 employees would receive a 7h training. It is also assumed that there will be a yearly action per Member State, which will amount to EUR 40,000 (based on market research). Enforcement costs for option 1.2.B are estimated to be of EUR 15 - 27 million for the period 2025-2040 (or EUR 1 – 1.8 million per year). Based on interviews with national enforcement authorities, in the context of the supporting study, option 1.2.B would not require significant additional resources on top of the existing ones to enforce CRD and SGD. It is therefore assumed that the measure will require an additional Full Time Equivalent, with its time divided equally between monitoring, inspecting, and handling complaints. 70h are assumed for familiarisation with the measure and adjustment of internal procedures to start enforcing the measure. 16 employees would receive a 7h training. It is also assumed that there will be a yearly action per Member State, which will amount to EUR 40,000 (based on market research). The other unit costs are assumed to be the same as in the previous measure. The costs of option 1.2.C for public administrations are expected to be the same as for option 1.2.B.

Impacts on the environment:

Due to the limitation of option 1.2.A mentioned above, consumers are unlikely to purchase products that effectively last longer and so the impact on the environment is considered negligible. As consumers will buy products that last longer, option 1.2.B will have a positive impact on the amount of CO2 emitted during production estimated at 0.3 – 0.4 mega tons (EUR 6 - 8 million), for the period 2025-2040 (or 0.02 – 0.03 mega tons per year, valued at EUR 0.4 – 0.5 million). In addition, it will lead to less water used, fewer particulate matter and polluting agents released and a reduction of the amount of waste, and will support the transition towards a more circular and sustainable economy. In addition to the impacts of option 1.2.B, due to the implementation of option 1.2.C, consumers will be able to keep products for a longer time compared to a situation where the information on software updates had not been available. This is expected to lead to a reduction of produced units and thus of CO2 emissions estimated to be around 0.4 – 0.7 mega tons (EUR 8 - 13 million) during production for the period 2025-2040 (or 0.03 – 0.05 mega tons per year, valued at EUR 0.5 – 0.9 million).

Coherence and applicability of the legal framework:

Overall, option 1.2.A will not facilitate the application of the legal framework as it relies on an assessment carried out by businesses according to the methodology of their choice, and thus difficult to verify for enforcers. Option 1.2.B is coherent with the legal framework and usefully complements the provisions set out in the Sale of Goods Directive and Consumer Rights Directive as it will ensure clearer information to consumers at the point of sale on the length of the producer’s commercial guarantees of durability for all goods in scope. For the same reason, the option will also ensure a better and coherent application of the EU legal consumer framework (in particular the SGD and CRD) as it specifies that information on the existence or absence of a producer’s commercial guarantee of durability should be provided to consumers. In addition to option 1.2.B, option 1.2.C would ensure further coherence with SGD, as it would stipulate the number of years during which manufacturers commit to providing software updates, without prejudice to the statutory SGD right on software updates if the ‘reasonably expected period’ for updates turns out to be longer.

How do the options compare?

The results of the multi-criteria analysis (MCA) 109 for the default scenario (presented in Annex 9, section 2.1) shows that the ranking of options with the highest score is the following: first option 1.2.C (information on commercial guarantee and information on software updates), followed by option 1.2.B (information on commercial guarantee only), then the baseline and finally option 1.2.A (information on expected lifespan). The sensitivity analysis suggests that this ranking of options is consistently the one obtaining the highest-score for the various alternative scenarios considered.

When looking at the proportionality of the three options (efficiency criterion), the MCA shows that the tangible and intangible costs of options 1.2.B and 1.2.C, including on businesses and public administrations,, are outweighed by their expected benefits to consumers and the environment(even for the worst-case scenario). In the eight scenarios that we simulated for the options, options 1.2.B and 1.2.C had a net positive outcome for society compared to the baseline. The results of the partial cost-benefit analysis (which only considers tangible and monetisable impacts) also suggest that the benefits of option 1.2.C and option 1.2.B are higher than their expected costs, with option 1.2.C presenting the highest net present value of the three options considered. The cost and lack of harmonised methodology to assess products’ lifespan represent the main weak points of option 1.2.A, undermining its effectiveness and efficiency. Its effectiveness would improve if product-specific rules imposed on the manufacturer are established that define the method and assumptions to calculate the expected durability of products. However, this would not be suitable within the scope of a horizontal consumer law instrument, with information obligations for the seller. 

6.1.2.Sub-Problem 1.3: Lack of reliable information about products’ reparability

Impacts of the policy options

Impacts on consumers:

The provision of updated, user-friendly repair and user manuals as considered under option 1.3.A will remove some barriers to self-repair and, to some extent, better-informed purchasing decisions, giving a sense of empowerment to consumers. By providing consumers with repair manuals, consumers are expected to experience a “gain” equal to the value of the additional lifespan gained as a result of the repair, which is estimated to amount to EUR 435 – 760 million for the period 2025-2040 (or EUR 29 – 51 million per year). The provision of information about how long and which spare parts are available as considered under option 1.3.B will help consumers identify which products offer better conditions in terms of availability of spare parts and therefore improve their decision-making process. Similarly as under the previous option, consumers are expected to experience a “gain” equal to the value of the additional lifespan gained as a result of the repair, which is estimated to amount to EUR 1 220 – 2 970 million for the period 2025-2040 (or EUR 81 – 198 million per year). Option 1.3.C, namely the provision of information on availability of repair services, will have less impact on consumers who do not live near the place where the product was purchased. Although producers will be able to provide information on repair services in other regions and Member States with which they are affiliated or associated, sellers will be less likely to have available information on the existence of local or independent repair services in other regions. Furthermore, the lack of effectiveness of the option in providing complete information is expected to lead only to a minor increase of the consumer surplus, which is estimated to amount to EUR 115 - 250 million in the period 2025-2040 (or EUR 8 – 17 million per year). The provision of a Reparability Scoring Index, as considered under option 1.3.D, is expected to have a limited impact on the quality of consumer decisions. A repair score allows for a wide range of reparability aspects to be covered effectively, without leading to information overload. However this option requires that all manufacturers implement the JRC general repair score methodology in exactly the same way to guarantee a reliable comparability between products. This could be difficult in reality given the heterogeneous nature of products. Nevertheless, this option is expected to lead to an increase in the consumer surplus, which is estimated to amount to EUR 455 – 995 million in the period 2025-2040 (or EUR 30 – 66 million per year). Option 1.3.E, namely the provision of a Repair Scoring Index, or other relevant repair information on a where applicable/available basis is expected to increase the quality of consumer decision-making as it will increase the likelihood that high quality information is provided to the consumer at the point of sale without leading to information overload. Furthermore it avoids the drawback of option 1.3.D which relies on all manufacturers implementing the JRC general repair score methodology in exactly the same way, in that it provides for the provision at the point of sale of those repair scores which are applicable in the case of the product and sector in question. It also has the benefit that the information can be provided on a wider range of products then the other options, as they would provide repair information on a defined, hence more narrow, product scope (i.e. energy-using goods only), while manufacturers may be potentially interested/able to provide repair information for other product categories as well. Finally, under option 1.3.E the fact that manufacturers who provide repair information on their products can be certain that such information will be presented to consumers at the point of sale, meaning that manufacturers will be incentivised to compete to provide the best repair conditions on their products. This increased competition is expected to provide further benefits for consumers.

Impacts on businesses:

Under option 1.3.A manufacturers will have to produce repair manuals for each model. It is estimated that the minimum cost of producing a repair manual (for users) is between EUR 4 000 and 6 000. In the case of a digital solution, these extra costs are estimated to amount to EUR 785 – 935 million in the period 2025-2040 (or EUR 52 – 62 million per year), of which about 12% for SMEs. In the case of a paper version, the extra costs are much higher. Administrative burdens under option 1.3.B mean that manufacturers will have to provide the necessary information to sellers (which include the costs of identifying which spare parts will be available and for how long) and that sellers will have to ensure that consumers receive this information (which could entail merely providing a link to the website of the manufacturer). The total extra costs are estimated to be EUR 1 685 – 1 715 million in the period 2025-2040 (or EUR 112 – 114 million per year). Option 1.3.C involves the need to maintain an updated list of repair services available and to ensure that consumers have access to that list. These extra costs are estimated to be EUR 3 120 – 3 380 million for the period 2025-2040 (or EUR 208 – 225 million per year). The administrative burden of option 1.3.D involves the need to assess the reparability of products and inform consumers of that assessment. These total extra cost are estimated to be EUR 4 180 – 4 360 million for the period 2025-2040 (or EUR 279 – 290 million per year). Given the substantial amount of resources that the assessment will require, in particular in the absence of detailed guidance/methodology for a given product category, it is expected that the option will have a negative impact on SME growth. The costs of option 1.3.E for businesses are expected to be much lower, as sellers will have to provide only such information as manufacturers make it available. There will be no specific obligation for manufacturers to provide such information on their products. The administrative costs are expected to be EUR 222 million in the period 2025-2040 (or EUR 15 million per year).

Impacts on public administrations:

Enforcement costs for option 1.3.A and for option 1.3.B are limited and each estimated to amount to EUR 16-21 million for the period 2025-2040 (or EUR 1 – 1.4 million per year). Based on interviews with national enforcement authorities, for both options, it is assumed that the measure would not require significant additional resources on top of the existing ones to enforce the Consumer Rights Directive and the Sale of Goods Directive. It is therefore assumed that the measure will require one additional Full Time Equivalent (per Member State), with its time divided equally between monitoring, inspecting, and handling complaints. 70h are assumed for familiarization with the measure and adjustment of internal procedures to start enforcing the measure. 16 employees would receive a 7h training. It is also assumed that there will be a yearly action per Member State, which will cost EUR 20,000 (based on market research). Enforcement costs for option 1.3.C are also limited and estimated to be of EUR 8-13 million for the period 2025-2040 (or EUR 0.5 – 0.9 million per year). In each case these costs are generated by the time needed to check whether the information is provided. Based on interviews with national enforcement authorities, it is assumed that the measure would not require significant additional resources on top of the existing ones to enforce the Consumer Rights Directive and Sale of Goods Directive. It is therefore assumed that the measure will require an additional 0.5 Full Time Equivalent (per Member State), with its time divided equally between monitoring, inspecting, and handling complaints. 70h are assumed for familiarization with the measure and adjustment of internal procedures to start enforcing the measure. 16 employees would receive a 7h training. It is also assumed that there might be a yearly action per Member State, which will cost EUR 20,000 (based on market research). Enforcement costs of option 1.3.D are estimated to be of EUR 32 - 37 million for the period 2025-2040 (or EUR 2.1 – 2.5 million per year), generated by the time needed to check whether the information is provided and accurate. Based on interviews with national enforcement authorities, it is assumed that the measure would require some additional resources on top of the existing ones to enforce the Consumer Rights Directive and Sale of Goods Directive. It is therefore assumed that the measure will require two additional Full Time Equivalents (per Member State), with their time divided equally between monitoring, inspecting, and handling complaints. 70h are assumed for familiarization with the measure and adjustment of internal procedures to start enforcing the measure. 16 employees would receive a 7h training. It is also assumed that there might be a yearly action per Member State, which will cost EUR 20,000 (based on market research). Option 1.3.E is expected to entail minimal enforcement costs, estimated at EUR 0.12 million in the period 2025-2040 (or EUR 0.008 million per year), generated by the time needed to check whether the seller has provided such information at the point of sale when made available by the manufacturer. It is assumed that this option would not require additional resources from enforcement authorities other than the ones related to the one-off costs of familiarisation and training. 70h are assumed for familiarisation with the option and adjusting the internal procedures to start enforcing the measure. 16 employees would receive a 7h training.

Impacts on the environment:

Under option 1.3.A some consumers will be able to maintain their goods in a better way and/or to repair some goods that would have been replaced in the absence of the manuals. Consequently, the repaired products will have a longer lifespan than they would have had in the baseline. The option will therefore lead to a reduction of produced units and thus of CO2 emissions estimated at 0.9 – 1.6 mega tons (valued at EUR 19 - 33 million) during production for the period 2025-2040 (or 0.06 – 0.11 mega tons per year, valued at EUR 1.3 – 2.2). Under option 1.3.B some consumers will be able to repair some goods that would have been replaced in the absence of the information on spare parts. Consequently, the repaired products will have a longer lifespan than they would have had in the baseline and will therefore lead to a reduction of CO2 emissions estimated at 1.9 – 3.3 mega tons (valued at EUR 39-68 million) for the period 2025-2040 (or 0.13 – 0.22 mega tons per year, valued at EUR 2.6 – 4.5 million). Under option 1.3.C, some consumers will be able to repair some goods that would have been replaced in the absence of information about repair services available which will lead to a reduction of CO2 emissions estimated at 0.04- 0.08 mega tons (valued at EUR 1 – 2 million) for the period 2025-2040 (or 0.002 – 0.005 mega tons per year, valued at EUR 0.07 – 0.13 million). Under option 1.3.D, some consumers will opt for goods that can be more easily repaired, which will lead to a reduction of CO2 emissions estimated at between 1.2 – 2.2 mega tons (valued at EUR 26 - 45 million) in the period 2025-2040 (or 0.08 – 0.15 mega tons per year, valued at EUR 1.7 – 3 million). Due to the implementation of option 1.3.E, some consumers will opt for goods that can be more easily repaired. Consequently, the repaired products will have a longer lifespan than they would have had in the baseline. For this reason we can conclude that this option will also have a positive impact on the environment. As the option will not require any physical paper repair manuals to be provided at the point of sale we can estimate that it will lead to a reduction in CO2 emissions which is at least greater than that of option 1.3.A in the period 2025-2040.

Coherence and applicability of the legal framework:

For option 1.3.A no issue of coherence and applicability has been identified. As already the case for some product categories, future Ecodesign/SPI requirements may provide further specifications concerning what the specific ‘repair and user manual’ should include for new/other product categories. As option 1.3.B focuses on providing consumers with information on the availability of spare parts at the point of sale, the option is coherent and complements Eco-design and future SPI product rules that may further specify how long and which spare parts should be kept available for a given product category for a minimum period of time. Under option 1.3.C and option 1.3.D it is expected to be challenging for consumer enforcement authorities to assess whether the information provided by retailers is comprehensive and reliable. Option 1.3.E is fully coherent with the legal framework, in that it provides for repair information to be made available at the point of sale in precisely those cases where the existing legal framework already requires such information to be provided by manufacturers or where manufacturers chose to provide such information voluntarily. It is also complementary to potential future Ecodesign/SPI requirements which may provide for further specifications concerning what repair information should be provided for specific product categories, possibly also in the form a Digital Product Passport. Whereas future SPI measure might thus specify how reparability information should be made available to consumers for specific products, option 1.3.E would require such information to be provided at the point of sale in a clear and legible form for an open range of products.

How do the options compare?

The results of the MCA and sensitivity analysis 110  (presented in Annex 9, section 2.2) shows that option 1.3.E (provision of Repair Scoring Index, or other relevant repair information on a where applicable/available basis) ranks either highest or joint highest in all scenarios. In a number of scenarios, including the default scenario, option 1.3.E ranks the highest, followed by option 1.3.B (provision of information about how long and which spare parts are available), the baseline, option 1.3.D (provision of a Reparability Scoring Index), option 1.3.A (provision of updated, user-friendly repair and user manuals) and 1.3.C (provision of information on availability of repair services) in that order. In a number of other scenarios, option 1.3.E ranks joint highest with option 1.3.B.

When looking at the proportionality of the options, the MCA shows that the tangible and intangible costs of options 1.3.B, 1.3.D, and 1.3.E, including on businesses and public administrations, are outweighed by their expected benefits to consumers and the environment (even in the worst case scenario).

6.2.Problem 2: Consumers face misleading commercial practices related to the sustainability of products

6.2.1.Sub-Problem 2.1: Consumers are sold products that do not last as long as they should and consumers expect

Impacts of the policy options

Impacts on consumers:

The collection of evidence on early failures of products identified by authorised entities, as considered under option 2.1.A, is expected to help consumers become aware of possible problems with certain product models and therefore take better informed decisions. The effectiveness of the option might be reduced by the fact that the consumers will have to actively look for the information on the websites of the authorised entities (e.g. consumer organisations). The share of products effectively covered will depend on voluntary actions and evidence collected by those entities, so the sample of products may not be fully balanced. This option is expected to lead to an increase of the consumer surplus, which is estimated to amount to EUR 100-180 million for the period 2025-2040 (or EUR 7 – 12 million per year) as consumers are expected to avoid buying certain product models identified with early failures. Option 2.1.B, namely the banning of certain identified practices associated with early obsolescence, contributes to protecting consumers by removing products from the market that would fail earlier than consumers would expect as a result of certain identified practices prohibited by the option. It will increase consumer protection, notably of vulnerable consumers 111 , as well as consumer trust in the market as it prevents situations where consumers would be misled by traders. A share (5%-20% depending on the product type) of products fails significantly earlier than could be reasonably expected, which leads to personal consumer detriment. This option is thus expected to lead to an increase in the consumer surplus, which is estimated to amount to EUR 1 800 – 2 250 million for the period 2025-2040 (or EUR 120 – 150 million per year) based on failures occurring in the first 60% of the product lifespan).

Impacts on businesses:

Option 2.1.A is expected to have an impact on the level playing field between companies. However, issues related to possible unbalanced product coverage might limit this impact. Since the option does not oblige third parties to collect the information but only to make it available to consumers, these third parties will have costs in relation to the updating of their websites. Those costs are estimated at EUR 4-5 million for the period 2025-2040 (or EUR 0.26 – 0.33 million per year). However they may compensate for it through membership fees or possible funding made available to them by Member States. When such information is made public concerning a given model, sellers may see a decrease in the demand of the specific model for sale. Option 2.1.B is expected to contribute very positively to a level playing field. This is because, in the baseline, companies engaging in the banned practices have lower costs than their competitors and charge higher prices to consumers (than they would if consumers knew about the real expected lifespan of the products) because consumers assume that the products would have an expected lifespan not much different from the average. It will also reduce barriers to cross-border trade as some Member States start to ban obsolescence practices, albeit in different ways. Rough estimations show that the option would lead to extra costs for businesses amounting to EUR 1 190 – 1 630 million for the period 2025-2040 (or EUR 79 – 109 million per year), falling mainly on large manufacturers. These costs include those related to the familiarisation with the measures (applicable to all businesses) as well as those linked to the need to review internal processes for these companies using practices targeted by the option.

Impacts on public administrations:

Enforcement of option 2.1.A could be challenging due to the voluntary nature of collecting information, which means that enforcement authorities will have difficulties in identifying situations where information is available but not disclosed. The costs are estimated to be of EUR 7-8 million for the period 2025-2040 (or EUR 0.46 – 0.53 million per year). Based on interviews with national enforcement authorities, it is assumed that the measure would not require significant additional resources on top of the existing ones to enforce the Unfair Commercial Practices Directive. It is therefore assumed that the measure will require one Full Time Equivalent (per Member State), with 50% of their time devoted to surveillance, 25% devoted to inspections and 25% to handling complaints. 35h are assumed for one person getting familiarized with the measure and the adjustment of internal procedures to start enforcing the measure. 16 employees would receive a 3.5h training. The costs of adjudication are expected to be in line with the unit costs presented in the previous measures. Enforcement of option 2.1.B is expected to result in the creation or strengthening of the capacity, including technical capacity, responsible for addressing obsolescence practices in each Member State. The enforcement costs are estimated at EUR 103-107 million for the period 2025-2040 (or EUR 6.9 – 7.1 million per year). Based on interviews with national enforcement authorities, it is assumed that the measure would require significant additional resources on top of the existing ones to enforce the Unfair Commercial Practice Directive (except for one Member States – France). It is therefore assumed that the measure will require a team of seven additional Full Time Equivalent (per Member State), with 42% of their time devoted to surveillance, 42% devoted to inspections and 16% to handling complaints. 70h are assumed for three people getting familiarized with the measure and the adjustment of internal procedures to start enforcing the measure. 16 employees would receive a 14h training. The costs of adjudication ate expected to be significantly higher than average given the complexity of the matter. It is assumed that one ADR case will costs around EUR 7,756 and a court case around five times the average.

Impacts on the environment:

Due to the implementation of option 2.1.A, some consumers will opt for goods that will last longer. The option will lead to a reduction of produced units and thus of CO2 emissions estimated at 0.2 – 0.4 mega tons (valued at EUR 4 - 8 million) during production for the period 2025-2040 (or 0.01 – 0.03 mega tons per year, valued at EUR 0.3 – 0.5 million). Due to the implementation of option 2.1.B, some consumers will opt for goods that will last longer. The option will lead to a reduction of produced units and thus of CO2 emissions estimated at 3.5 – 4.3 mega tons (valued at EUR 72 - 90 million) during production for the period 2025 – 2040 (or 0.2 – 0.3 mega tons per year, valued at EUR 5 – 6 million).

Coherence and applicability of the legislation:

No issue of coherence was identified for option 2.1.A. Option 2.1.B is expected to have a significant impact on ensuring a better and coherent application of the EU legal consumer framework through adding more specific and stronger consumer protection rules.

How do the options compare?

The results of the MCA and the sensitivity analysis 112  (presented in Annex 9, section 2.3) shows that option 2.1.B (Ban of certain identified practices associated to early obsolescence) ranks the highest, followed by option 2.1A (Information on early failures of products identified by authorised entities) and then the baseline.

When looking at the proportionality of the two options, the MCA shows that the tangible and intangible costs of options 2.1A and 2.1.B are outweighed by their expected benefits (even for the worst-case scenario). The results of the partial cost-benefit analysis (which only considers tangible and monetisable impacts) also suggest that the benefits of options 2.1.A and 2.1.B are higher than their expected costs, with option 2.1.B presenting the highest net present value.

6.2.2.Sub-problem 2.2: Consumers are faced with the practice of making unclear or not well-substantiated environmental claims (“Greenwashing”)

Impacts of the policy options

Impacts on consumers:

Under option 2.2.A, general/vague statements on the environmental performance of products or traders (such as “good for the environment”, “friend of nature”, etc.) would be forbidden unless the product or trader is considered to have an “environmentally excellent performance” in accordance with EU applicable laws (e.g. presence of the EU Ecolabel). Banning such vague statements will contribute to consumers taking better informed decisions and will also give more prominence to those products that are truly “environmentally excellent”. The option will have a positive impact on consumer trust, as highlighted by stakeholders from all groups. The option is expected to lead to consumer welfare estimated at EUR 2 155 – 3 960 million for the period 2025-2040 (or EUR 144 – 264 million per year). Option 2.2.B, namely a prohibition of environmental claims that do not fulfil a minimum set of criteria, would particularly provide for general rules for the claims not yet covered under the Green Claims Initiative. By specifying minimum criteria for assessing the fairness of other claims, this option will further contribute to improving the reliability of the information provided to consumers and, therefore, will have a positive impact on the decision making of consumers. When compared to this alternative baseline, this impact is estimated to amount to an increase in consumer welfare of between EUR 1580 – 2 910 million for the period 2025-2040 (or EUR 105 – 194 million per year). Option 2.2.C will entail a combination of the impacts described for option 2.2.A and option 2.2.B. The option is thus expected to lead to an increase in the consumer surplus, which is estimated to amount to EUR 3 735 – 6 870 million for the period 2025-2040 (or EUR 249 – 458 million per year).

Impacts on businesses:

The impact of option 2.2A on a level playing field is expected to be positive as products with unsubstantiated vague claims will no longer compete with products that are indeed environmentally excellent. The option is expected to entail compliance costs for businesses at EUR 2 900 – 3 150 million for the period 2025-2040 (or EUR 193 – 210 million per year), linked to familiarisation with the option and the removal of unfounded claims for the small share of products in stock before the approval of the measure. The impact of option 2.2.B on the level playing field is expected to be positive, as products with unsubstantiated claims will no longer compete with products containing green claims complying with the minimum set of criteria. The option is expected to entail compliance costs of EUR 2 900 – 3 150 million for the period 2025-2040 (or EUR 193 – 210 million per year), of which about 99% will be for SMEs. Option 2.2.C will entail a combination of the impacts described for option 2.2.A and option 2.2.B. There are certain economies of scales when the two options are combined, related, for example, to the fact that the removal of the relevant claims for the small share of products in stock for which each of the two types of claims are made (vague claims which are not based on “environmentally excellent performance” in accordance with applicable EU laws + environmental claims that do not fulfil a minimum set of criteria) can be conducted simultaneously. The substantive compliance costs are estimated at EUR 3 300 – 3 500 million for the period 2025-2040 (or EUR 220 – 233 million per year). The costs of these options are significantly higher than that of the options assessed related to Problem 1 (Consumers lack reliable information at the point of sale to make environmentally sustainable consumption choices) and Sub-Problem 2.1 (Consumers are sold products that do not last as long as they should and consumers expect) because they apply to a significantly higher number of businesses (about 40 times more).

Impacts on public administrations:

Option 2.2.A facilitates enforcement against misleading claims as it specifies what type of proof is accepted in order to use general/vague environmental claims (e.g. environmentally excellent performance as attested for example by the presence of the EU Ecolabel). Overall, the enforcement costs are estimated at EUR 7-12 million for the period 2025-2040 (or EUR 0.5 – 0.8 million per year). It is assumed that the measure would not require significant additional resources on top of the existing ones to enforce Unfair Commercial Practices Directive. In fact, some of the interviewed national enforcement authorities even indicated that the measure might lead to savings as it would help them to prove the practice of “greenwashing” more easily (less resources are needed to substantiate their assessment). For these Member States it is considered that the measure does not bring incremental costs. For the others, it is assumed that one Full Time equivalent would work half time with 50% of its time devoted to monitoring, 25% to inspections and the remaining 25% to handle complaints. For all Member States, 35h are assumed for two people getting familiarised with the measure and the adjustment of internal procedures to start enforcing the measure. 16 employees would receive a 7h training. It is also assumed that there might be a yearly action per Member State, which will cost EUR 20,000 (based on market research). The costs of an Alternative Dispute Resolution body adjudication and of a court adjudication were obtained from the Impact Assessment for the review of the Consumer Protection Cooperation Regulation and supporting study 113 .  The contribution of option 2.2.B to more effective enforcement will be less pronounced than that of option 2.2.A as authorities would need to assess to what extent the specific claim complies with the criteria set out under this option. The costs are expected to be similar to those of option 2.2.A and amount to EUR 7-12 million for the period 2025-2040 (or EUR 0.5 – 0.8 million per year). The calculation of the enforcement costs followed the same approach and assumptions presented for the previous measure. Option 2.2.C will entail a combination of the impacts described for option 2.2.A and option 2.2.B. There are significant economies of scales when the two options are combined, due to the fact that the expertise needed to investigate the two different types of claims at issue will be quite similar. Overall, the enforcement costs are estimated at EUR 7-12 million for the period 2025-2040  (or EUR 0.5 – 0.8 million per year).

Impacts on the environment:

As a result of the implementation of option 2.2.A, certain consumers will purchase products that will be truly better for the environment. Although it is not possible to assess how much “greener” those products will be (compared to the alternative that would be purchased in the baseline), it is estimated that the impacts on the environment will be highly positive. For the same reasons, it is estimated that the impacts on the environment of option 2.2.B will be also positive.. The impact on the environment of option 2.2.C will be highly positive (at least as high as the impact of option 2.2.A), but an exact quantification of the impacts is not possible.

Coherence and applicability of the legal framework:

Option 2.2.A will be coherent with other legislation, such as the EU Ecolabel or the upcoming Green Claims Initiative, as these will be used as the benchmark to assess the reliability of the claims. Similarly option 2.2.B will be also coherent with the other legislation as this option will provide for general rules to capture the claims not regulated by others. Option 2.2.C, as a combination of options 2.2.A and 2.2.B, will have a positive impact on ensuring a better and coherent application of the EU legal consumer framework, in particular of the UCPD, through adding more specific and stronger consumer protection rules.

How do the options compare?

The results of the MCA and sensitivity analysis 114  (presented in Annex 9, section 2.4) shows that all options rank higher than the baseline, with option 2.2.C (the combination of options 2.2A and 2.2B) coming first, followed by option 2.2.A (Ban of general /vague environmental claims), then option 2.2.B (Prohibition of environmental claims that do not fulfil a minimum set of criteria), and then the baseline.

When looking at the proportionality of the 3 options, the MCA shows that the tangible and intangible costs of options 2.2.A, 2.2.B and 2.2.C, including on businesses and public administrations, are outweighed by their expected benefits for consumers and the environment (even for the worst-case scenario). The results of the partial cost-benefit analysis (which only considers tangible and monetisable impacts) also suggest that the benefits of option 2.2.C are higher than their expected costs, although this is not necessarily the case for options 2.2.A and 2.2.B.

6.2.3.Sub-problem 2.3: Consumers are faced with the use of sustainability labels and digital information tools that are not always transparent and credible 

Impacts of the policy options

Impacts on consumers:

The introduction of minimum criteria for sustainability labels and digital information tools (thus increasing their transparency and credibility), as envisaged under option 2.3.A, could enhance the quality of consumer decision-making. However, this option would rely on voluntary uptake, which would mean that there would be no harmonisation across labels or information tools. The introduction of minimum criteria for assessing the fairness of sustainability labels and digital information tools, as envisaged under option 2.3.B, would also increase the transparency and credibility of these labels and tools. This will enhance the quality of consumer decision-making and the level of consumer protection. The impact on consumer welfare depends on the extent of the impact of the measure in increasing consumer trust in labels. When assuming a moderate impact on consumer trust, this option is estimated to increase consumer welfare by EUR 4 500 – 6 610 million for the period 2025-2040 115 (or EUR 300 – 441 million per year). The impact on consumer protection of option 2.3.C, namely the requirement for pre-approval of sustainability labels and digital information tools via an EU body, is expected to be similar to those described for option 2.3.B but slightly higher, as the compliance level will be higher given that only pre-approved labels and digital information tools will be allowed. The consumer welfare is estimated to amount to EUR 4 500 – 6 610 million for the period 2025-2040 (or EUR 300 – 441 million per year), similar to option 2.3.B. 

Impacts on businesses:

As option 2.3.A is voluntary, the impact of the option on businesses is negligible. Option 2.3.B is expected to contribute more thoroughly to a level playing-field between products displaying sustainability labels but also between organisations running such labels, as well as organisations running such digital information tools. The entities running and managing the labels and information tools will have administrative costs between EUR 615 – 620 million for the period 2025-2040 (or EUR 41 – 41.3 million per year). They will also incur substantive compliance costs resulting from implementing the necessary changes in their internal processes, including, for the organisations running the labels, carrying out certifications of the applicants (if they are not doing it already at the baseline). These costs are estimated to amount to EUR 3 025 - 3 500 million for the period 2025-2040 (or EUR 201 – 233 million per year) and are likely to be passed on to manufacturers and sellers applying for the label. These do not include the costs for digital information tools as there is very limited data about the number of tools currently in use. Option 2.3.C is expected to bring administrative burdens similar to the ones described for the entities running and managing the labels and digital information tools in the context of option 2.3.B. These costs are estimated to amount to EUR 615 – 620 million for the period 2025-2040 (or EUR 41 – 41.3 million per year). The substantive compliance costs for this option are similar to those described for option 2.3.B plus an additional fee when applying for pre-approval (which we assume will be similar to the upper limit of the EU Ecolabel fee). This will amount to EUR 3 120 - 3 580 million for the period 2025-2040 (or EUR 208 – 239 million per year).  The costs of these options are significantly higher than that of the options related to Problem 1 (Consumers lack reliable information at the point of sale to make environmentally sustainable consumption choices) and Sub-Problem 2.1 (Consumers are sold products that do not last as long as they should and consumers expect) because they apply to a significantly higher number of businesses (about 40 times more).

Impacts on public administrations:

Given the voluntary nature of option 2.3.A, there will be no enforcement costs associated. Other costs to public bodies (including the Commission) will be related to the organisation of meetings and preparation of the minimum criteria. These are estimated to be around EUR 94 000 in the first year and about EUR 16 000 per year 116 . Enforcement costs under option 2.3.B were estimated at EUR 14 - 15 million for the period 2025-2040 (or EUR 0.9 – 1 million per year).It is assumed that the measure would not require significant additional resources on top of the existing ones to enforce the Unfair Commercial Practices Directive. In fact, some of the interviewed national enforcement authorities even indicated that the measure might lead to savings as it will help them tackle the issue of lack of transparency and reliability of labels more easily (less resources are needed to substantiate their assessment). For these Member States it is considered that the measure does not bring incremental costs. For the others, it is assumed that one Full Time equivalent will work to monitor (50%), carry out inspections (40%) and handle complaints (10%). For all Member States, 35h are assumed for two people getting familiarized with the measure and the adjustment of internal procedures to start enforcing the measure. 16 employees would receive a 7h training. The costs of an Alternative Dispute Resolution body adjudication and of a court adjudication were obtained from the Impact Assessment of the review of the Consumer Protection Cooperation Regulation and supporting study 117 . Enforcement of option 2.3.C will be significantly higher than in option 2.3.B as all labels will need to be pre-approved by an EU body. The costs of setting up and running the EU body were considered to be around EUR 4.02 million per year 118 , which corresponds to a net present value for the period 2025-2040 of about EUR 42 million. National enforcement costs are estimated to be similar to those under option 2.3.B and amount to EUR 14 - 15 million for the period 2025-2040 (or EUR 0.9 – 1 million per year). 

Impacts on the environment:

The impacts on the environment of option 2.3.A are estimated to be negligible (around zero) for the reasons mentioned above. Overall the impacts on the environment of option 2.3.B are expected to be positive. However, due to a series of factors (e.g. sustainability labels are often covering impacts other than climate change, there are no data on the share of sales per label etc.), it is not possible to estimate quantitatively the impact of the option. The impact of option 2.3.C on the environment are expected to be similar to option 2.3.B, but for the same reasons not possible to estimate quantitatively.

Coherence and applicability of the legal framework:

There was no issue of coherence identified for option 2.3.A. Option 2.3.B will have a positive impact on ensuring a better and coherent application of the EU consumer legal framework, in particular of the UCPD, as it will strengthen the protection of consumers against misleading labels, including by building on existing requirements for labels under the Public Procurement Directive, Article 43 119 . Option 2.3.C will have a positive impact on ensuring a better and coherent application of the EU legal consumer framework, in particular of the UCPD.

How do the options compare?

The results of the MCA and sensitivity analysis 120  (presented in Annex 9, section 2.5) show that option 2.3.B (Prohibition of sustainability labels and digital information tools not meeting minimum transparency and credibility requirements ) ranks highest followed in the ranking by under the default scenario by option 2.3.C ( Pre-approval of sustainability labels and digital information tools via an EU body) in second place, with no discernible difference between option 2.3.A (EU-led voluntary initiative to develop minimum criteria on sustainability labels) and the baseline.

When looking at the proportionality of the 3 options, the MCA shows that the tangible and intangible costs of option 2.3.B, including for businesses and public administrations, are outweighed by its expected benefits for consumers and the environment (even for the worst-case scenario). The results of the partial cost-benefit analysis (which only considers tangible and monetisable impacts) also suggest that the benefits of options 2.2.B and 2.2.C are higher than their expected costs, with 2.3.B coming out (on average) as more beneficial.

7.Preferred policy options 

This Impact Assessment identifies a number of preferred policy options ensuring a coherent policy approach together with the upcoming Green Claims Initiative and Sustainable Products Initiative adopted together with this initiative. The presentation and assessment of the options has confirmed the synergies that exist between the three initiatives. The preferred options selected are fully coherent with the other two initiatives, and in several instances provide for general rules that the other two initiatives will usefully complement.

For each of the sub-problems addressed by this Impact Assessment, the option which received the highest ranking overall in the Multi-Criteria and sensitivity analysis (presented in Annex 9, section 2.5), as detailed per sub-problem in Section 6 above, was always selected as the preferred policy option. As well as this quantitative analysis, the proportionality and qualitative impact of each of the preferred policy options, as detailed per sub-problem in Section 6 above, was always considered in the identification of the preferred policy options.

In relation to sub-problem 1.1 (lack of reliable information on product’s environmental characteristics at the point of sale), all options have been discarded at an early stage as their added value could not be demonstrated, and the measures taken under the Green Claims Initiative and the Sustainable Products Initiative are expected to reduce this sub-problem significantly. 

In relation to sub-problem 1.2 (the lack of reliable information on products’ lifespan at the point of sale), option 1.2.C will be selected as the preferred policy option, namely the provision of information on the existence or absence of a producer’s commercial guarantee of durability and of the period of time during which free software updates are provided, for a medium product scope (i.e. all energy-using goods), to be achieved via targeted amendments of the Consumer Rights Directive. The option will guide consumers towards products that last longer, thereby having positive impacts on the environment. The impact on businesses of informing consumers on the commercial guarantees and on the period of software updates will be limited as they will still be free to decide whether or not to offer such guarantees or such a period of free software updates. The complementarity with the SPI is ensured, as the “guaranteed lifespan” information under this option may be complemented in the future under the SPI with other information requirements (e.g. “expected/estimated lifespan”, which may be longer than the “guaranteed lifetime”) when considered feasible and appropriate subject to future Impact Assessments related to SPI measures for specific products or groups of products. The proportionality of the measure as regards the producer’s commercial guarantee of durability is ensured by confining the scope of the measure to energy-using goods, thus ensuring that traders are only subject to this requirement in relation to goods for which durability can be reliably estimated and about which consumers are mostly interested to receive information. Moreover, proportionality is ensured by allowing flexibility for the producer to decide on whether or not to offer a commercial guarantee of durability, and for what duration, depending on the producer’s business strategy, the interaction between the seller and the producer, and the needs of the consumers in a given market or for a given product category. The costs of these information requirements are expected to be compensated by an increase in the price of the good (as consumers are willing to pay for longer commercial guarantees of durability) and possibly by an increase of demand of those same goods. On the provision of information on the availability of free software updates, proportionality will be ensured by requiring the provision of information on the existence of such updates only in the cases in which they are provided for a period that is longer than the period for which the producer’s commercial guarantee of durability is provided, and by requiring the provision of information on the absence of such updates according to the provisions of this proposal only in case there is also no information on the producer’s commercial guarantee of durability provided. This ensures that consumers are not subject to an abundance of information, or ‘information overload’, which could lead to confusion and thus interfere with their transactional decision. It also ensures that traders are not subject to unnecessarily burdensome information requirements.

In relation to sub-problem 1.3 (lack of reliable information at the point of sale on products’ reparability), option 1.3.E will be selected as the preferred policy option. This option entails the provision of a Repair Scoring Index, or other relevant repair information on a where applicable/available basis, for an open product scope, to be achieved via targeted amendments of the Consumer Rights Directive. For a potentially very wide range of products, this option will provide consumers with information at the point of sale that will help them choose products that are more easily reparable, whenever manufacturers have made this information available or when such information exists in accordance with EU or national applicable laws. This will also improve consumers’ ability to repair products or have them repaired, and will thus have a positive impact on the environment as it will positively affect the useful lifespan of products. Costs incurred by businesses will be very limited as sellers will have to provide only such information as manufacturers make available, or whenever applicable under national or EU product rules. Under this option, there will be no specific obligation for manufacturers to provide such information but they will be incentivised to compete to provide the best repair conditions on their products. The complementarity with the SPI is ensured, as the repair information that will be provided at the point of sale under this option can be specified in future requirements under the SPI (e.g. repair scoring index, or other relevant repair information) when considered feasible and appropriate, subject to future impact assessments related to SPI implementing measures for specific products or groups of products. The proportionality of this measure is ensured by requiring the provision of such information at the point of sale only in cases where a reparability score is available or required for that product in accordance with EU or national applicable laws or whenever other relevant repair information is made available by the producer. Traders are not obliged to provide information at the point of sale regarding the absence of such information. This ensures that the burden placed on traders by these requirements is minimal.

In relation to sub-problem 2.1 (products that do not last as long as they should or consumers expect), option 2.1.B will be selected as the preferred policy option. This option entails a ban of certain identified practices of early obsolescence, to be achieved via targeted amendments of the Unfair Commercial Practices Directive. This will help enforcers to effectively address these practices which lead to a faster obsolescence of products. This will, in turn, reduce consumer detriment (caused by products failing early) and have positive impacts on the environment, with goods lasting longer. It will also improve the level-playing field between businesses. This option will usefully complement future SPI or Ecodesign requirements, and will provide better consumer protection against early obsolescence of specific product models (e.g. a specific model of coffee machine) through facilitating public enforcement and allowing the harmed consumers to claim individual remedies where such practices are deemed unfair. The SPI may on the other hand set specific requirements (e.g. on minimum durability or reparability) for the whole product category (i.e. all coffee machines) when considered feasible and appropriate subject to future Impact Assessments of product rules. The proportionality of the ban of certain practices related to the early obsolescence of products is ensured by targeting specific and well defined existing practices, including providing software updates which negatively impact the ability of the products to maintain their required functions and performance through normal use, omitting to provide software updates which are needed for the products to maintain their required functions and performance through normal use in accordance with legal requirements, marketing of goods that have been designed with a view to limit their durability, marketing of goods that do not allow disassembly or repair in accordance with legal requirements, and marketing of goods that are designed in a way to induce the consumer into replacing their consumable earlier than necessary, or to prevent the use of consumables provided by alternative producers, without informing the consumer thereof. This targeting of specific practices is proportionate as it ensures legal certainty for traders. It also facilitates enforcement, as enforcement authorities will not be required to prove that the early obsolescence of a product has been designed with the intention of stimulating the purchase of a new model of the product itself. Moreover, enforcement authorities will not be required to demonstrate the negative impact of the unfair practice on the consumers’ transactional decision, if this measure would be implemented via an update of the ‘blacklist’ (Annex I) of the UCPD.

In relation to sub-problem 2.2 (unclear or not well-substantiated green claims), option 2.2.C will be selected as the preferred policy option, namely the banning of unfounded general/vague claims and setting criteria for assessing the fairness of all environmental claims. This will be achieved via targeted amendments of the Unfair Commercial Practices Directive. This option will usefully complement the Green Claims Initiative and provide a clear framework for the claims that the Green Claims Initiative does not yet cover. It will bring legal clarity both for businesses and enforcers as to which green claims can be allowed and under which conditions. It will also improve consumer trust in green claims and will have a positive impact on the environment as consumers will be able to choose products that are truly environment-friendly. The proportionality of the ban of general/vague environmental claims used in marketing towards consumers is ensured by bringing significant projected benefits for consumers while limiting the burden on traders. Traders will be permitted to make general/vague environmental claims in cases where environmentally excellent performance of products or traders which can be demonstrated via Regulation (EC) 66/2010 (EU Eco-label), or officially recognised ecolabelling schemes in the Member States in accordance with Article 11 of Regulation (EC) 66/2010, or in accordance with other applicable EU laws. Moreover, enforcement authorities will not be required to demonstrate the negative impact of the unfair practice on the consumers’ transactional decision, if this measure would be implemented via an update of the ‘blacklist’ (Annex I) of the UCPD. The proportionality of the criteria for assessing the fairness of any environmental claim used in marketing towards consumers is ensured by introducing uniform minimum requirements. Traders shall fulfil these requirements when making such claims. The preferred policy option does not prescribe any specific methodology for the substantiation of any environmental claim. Other potential legislation may be tailored to specific types of environmental claims, for example those based on certain environmental impacts. This option will also provide competent national bodies uniform criteria for helping them to assess the fairness of any environmental claim, providing legal certainty and facilitate enforcement activities.

In relation to sub-problem 2.3 (the use of sustainability labels and digital information tools that are not always transparent or credible), option 2.3.B will be selected as the preferred policy option. This option entails providing minimum transparency and credibility criteria for assessing the fairness of sustainability labels and digital information tools, and will be achieved via targeted amendments of the Unfair Commercial Practices Directive. This will provide a stronger framework to ensure the reliability and transparency of sustainability labels and digital information tools, thus having a positive impact on consumer trust. By setting out clear criteria, this will facilitate the work of enforcers. The proportionality of the criteria for assessing the fairness of the display of sustainability labels in marketing towards consumers is ensured by requiring a limited number of uniform minimum requirements to ensure the transparency and credibility of such sustainability labels towards consumers. This ensures that entities running sustainability labels, as well as the traders applying for those sustainability labels, do not face disproportionate costs. At the same time it will ensure legal certainty for traders, facilitate enforcement activities and pursue a high level of consumer protection. The proportionality of the criteria for assessing the fairness of sustainability information tools is ensured by introducing criteria to assess the transparency and credibility of the information provided by the tools only. No requirements are introduced that would subject the taking up and pursuit of the activity of a provider of such software to prior authorisation or any other requirement having equivalent effect, thus ensuring the full compliance of the provisions with the provisions of Art. 4 (1) of Directive 2000/31/EC regarding the establishment of information society services. This ensures that the impacts on traders providing or marketing such tools are limited.

The contribution of the selected options to this initiative’s specific objectives can be summarised as follows:

-The objective of enabling informed purchasing decisions by consumers to foster sustainable consumption would be particularly achieved thanks to options 1.2.C and 1.3.E, as these would guide consumers towards products with a longer guaranteed lifespan and actionable repair information. It would also be indirectly achieved by options 2.1.B, 2.2.C, and 2.3.B, as these options would strengthen the reliability of the information provided to consumers.  

-The objective of eliminating untrustworthy practices that cause damage to the sustainable economy and mislead consumers away from sustainable consumption choices would be particularly achieved through options 2.1.B, 2.2.C, and 2.3.B, which would tackle early obsolescence practices, greenwashing and the lack of transparency and credibility of sustainability labels and digital information tools.

-Finally the objective of ensuring a better and coherent application of the EU legal framework would be achieved thanks to all of the preferred policy options, as they prove to be easily enforceable and complement effectively the existing EU legal framework.

When the impacts of all of the preferred policy options are combined (options 1.2.C, 1.3.E, 2.1.B, 2.2.C and 2.3.B), the initiative is expected to bring significant benefits to consumers compared to the baseline. It will increase consumer welfare by at least EUR 12.5 – 19.4 billion for the period 2025-2040. This would amount to EUR 0.8 – 1.3 billion per year. This is a partial estimation only, due to lack of available data to carry out this monetisation for all selected options and/or full scope of some selected options. It will also bring benefits to the environment, with a partial estimation of the total saved CO2e over a period of 15 years of 5 - 7 MtCO2e.

To achieve these benefits, businesses will have to adjust, which will cost about 65% +/-18% (so between 47% and 83%) of the partial monetisable benefits, amounting to a total cost for businesses (combining one-off costs and annual recurrent costs) of between EUR 9.1 – 10.4 billion for the period 2025-2040. This would amount to EUR 0.6 – 0.7 billion per year on average. This represents an average one off cost per company of between EUR 556 - 568, followed by an annual recurrent cost of between EUR 64 - 79 for the period covered. If we break these costs down further, we can see that SMEs will on average have a one off cost of EUR 525 – 536 and annual recurrent costs of EUR 52 - 62, while large enterprises will have a one off cost of EUR 13 301 – 13 656, followed by annual recurrent costs of EUR 4 919 – 6 965 for the period covered. On the other hand, businesses will also experience very important benefits related to level playing field as businesses that currently mislead consumers would have to align their practices with those that are truly sustainable. In addition, the preferred options would also benefit businesses by ensuring that companies active on the Single Market play by the same rules, thereby reducing barriers to cross-border trade. The enforcement of the preferred options on the part of public administrations will cost about EUR 441 800 – 502 200 per year per Member State.

A detailed analysis of the total monetisable consumer welfare benefits, and the costs for businesses and public administrations, of the all 5 preferred policy options combined (1.2.C, 1.3.E, 2.1.B, 2.2.C and 2.3.B) as well as the benefits and costs per individual preferred policy option can be found in Annex 3. As analysed in detail in Annex 8, the combination of preferred policy options also brings other substantial benefits which were not monetised, such as impact on quality of consumer decision making, consumer trust, and consumer protection, level playing field and reduction in barriers to cross-border trade. From the foregoing, we can conclude that the impact of the combination of the preferred policy options will be proportionate in relation to the various stakeholder groups concerned, including consumers, public administrations and businesses (both SMEs and large enterprises). Through the foreseen reduction of CO2 emissions and other environmental impacts, it will also bring important benefits to society as a whole.

Application of the ‘one in, one out’ approach

The costs for businesses can be further broken down into adjustment costs and administrative costs in accordance with the criteria set out in the Commission’s Better Regulation Toolbox #58 and #59 121 . Based the analysis of costs, the only one of the preferred policy options which would incur administrative costs is option 1.2.C 122 . This option would entail in particular costs for businesses in familiarising themselves with the information obligations, and for designing and placing information material (labelling) 123 . These costs would amount to EUR 225-257 million in total for the period 2025-2040 (combining one-off costs and annual recurrent costs). On average, this would represent average administrative costs of 15-17 million per year. Further details of how the costs are broken down by preferred policy option can be found in Annex 3.

8.How will actual impacts be monitored and evaluated?

The Commission will evaluate the effectiveness, efficiency, relevance, coherence and EU added value of this intervention. In order to monitor and evaluate the progress made towards the objectives of this initiative, monitoring indicators have been identified and are listed in the Table available in Annex 10. These indicators can serve as the basis for the evaluation that should be presented no sooner than 5 years after the entry into application, to ensure that enough data is available after full implementation in all Member States. These indicators are partially based on statistics already collected in the framework of the Consumer Scoreboards published every two years and which relies on representative surveys with consumers and retailers in the EU. The monitoring will also include a mystery shopping and targeted surveys. It will also feed on the feedback from Member States, notably the experience collected in the course of coordinated checks (sweeps). Such sweeps will be planned after the entry into force of the instrument, in agreement with Member States.

This data collection will also feed into the Commission's reporting on the transposition and implementation. In addition, the Commission will remain in close contact with the Member States and with all relevant stakeholders to monitor the effects of the possible legislative act. To limit the additional administrative burden, the proposed indicators on the table in Annex 10 rely on existing data sources whenever possible. Data collection will aim to identify more precisely the extent to which changes in the indicators could be ascribed to the proposal. The surveys carried out for the Consumer Scoreboards have time series on most indicators, allowing in principle (through statistical analysis) to discern the impact of a particular policy initiative from broader trends.

Annex 1: Procedural information

1.Lead DG, Decide Planning/CWP references

124 Lead DG: European Commission Directorate-General Justice and Consumers, DG JUST, Ref. Decide: PLAN/2020/7019. Adjusted Commission Working Programme 2020, Annex I, nr. 6.

2.Organisation and timing

125 126 This Impact Assessment (IA) was carried out by Unit E1 “Consumer Policy’ of the European Commission, DG Justice and Consumers. The Inception Impact Assessment (IIA) on the Empowering the consumer for the green transition initiative was published on 23 June 2020 along with its corresponding consultation strategy. The IIA outlined the initiative’s context, objectives and policy options whilst also discussing expected impacts and evidence base.

Four Inter-service Steering Group (ISSG) meetings were held between April and December 2020 including participation from the Secretariat General, ESTAT and Directorates-General: AGRI, CLIMA, CNCT, COMP, ECFIN, EMPL, ENER, ENV, FISMA, GROW, HOME, JRC, LS, MARE, MOVE, SANTE and TRADE. DG JUST agreed with the Secretariat General on creating a sub-group of the Circular Economy Action Plan (CEAP) ISG rather than setting up a separate ISG. The CEAP ISG sub-group was consulted on the draft IIA and consultation strategy, the open public consultation, the preparatory study and several drafts of this IA report in the first stages of the preparatory phase. The Inter-service consultation on the draft legal text and the revised IA report took place during the period 29 October 2021 – 23 November 2021.

3.Consultation of the RSB

An upstream meeting was held with the Regulatory Scrutiny Board (RSB) on 15 July 2020 to informally discuss questions concerning how to prepare the best possible report for this initiative. The IA report was submitted to the RSB on 6 January 2021 with a subsequent RSB hearing scheduled on 3 February 2021. The RSB provided a negative opinion on 5 February 2021. Taking into account the RSB comments, a revised Impact Assessment report was resubmitted on 22 July 2021, following the first submissions of the IA reports of the Sustainable Products and Green Claims Initiatives on 20 July 2021. The RSB provided a positive opinion with reservations on 17 September 2021.

4.Evidence, sources and quality

External expertise

A study was outsourced to a consortium led by ICF S.A. to feed into the preparation of this Impact Assessment. The study, which took place between February 2020 and June 2021, relied on a combination of sources and methods, including extensive in-depth consultation with stakeholders both at the national and EU level, a consumer survey, industry surveys, desk research, legal analysis, literature review, mystery shopping exercises, stakeholder and expert workshops and a combination of approaches to assess the impacts of the policy options (including agent-based simulation, cost-benefit analysis, multi-criteria analysis).

Stakeholder consultation

This IA relies on an extensive stakeholder consultation, which includes several strands to achieve complementarity, representativeness and comprehensiveness in the views collected.

An Open Public Consultation ran between 30 June 2020 and 6 October 2020, covering both the New Consumer Agenda but also 3 initiatives in the field of consumer law, including the one covered by this IA. The questionnaire of the public consultation was made available on the Commission's website in all 24 EU languages. The section of the OPC devoted to this initiative yielded 313 responses. A summary report 127 of the findings was published in November 2020. 

Targeted consultation was conducted by the external consultants under the study to complement and deepen the feedback collected in the Open Public Consultation. It included 149 in-depth interviews with selected key stakeholders in the main groups concerned by the initiative: national authorities, EU and national business associations and EU and national consumer associations. In addition, an online industry survey allowed to collect the views of 110 companies. An online consumer survey was carried out in all Member States to collect the views and experience of 11 805 consumers.

Four workshops have also been organised. The first one allowed to collect expert views on the extent of the problems and examples of effective actions. A second one with industry associations allowed to collect views on how digital means can be used to provide product information. The third one gathered all stakeholder groups to collect feedback on possible options to address the problem identified. Finally, the last one allowed to collect the view of consumer protection enforcement authorities (CPC authorities) to collect their views on enforcement challenges.

Results from these stakeholder consultations are summarised in Annex 2.

Other studies and sources

Further references, including recent market and behavioural studies commissioned by the European Commission on environmental claims and the role of consumers in the circular economy, have been used in the development of this Impact Assessment and are mentioned throughout the text. This Impact Assessment also cross-references studies and evaluations which have fed into the 2017 Fitness Check of Consumer and Marketing law and the follow-up New Deal for Consumers proposals as well as in the ongoing preparatory work for the SPI and Green Claims initiative.

Limitations and robustness of findings

The data collection and analysis carried out have a number of limitations, whose impact has been mitigated to a maximum possible extent.

The estimations of consumer detriments and costs for businesses, while providing a sense of magnitude, have limitations which are explained in detail in Annex 4.

Annex 2: Stakeholder consultation

1.Introduction and overview of the consultation strategy

The goal of the consultation strategy was to ensure that, across a series of consultation activities, all relevant stakeholders were given an opportunity to express their views on the initiative aimed at empowering consumers in the green transition. The primary stakeholders of this initiative are consumers and businesses (retailers and producers) across the EU. However, besides these two, other stakeholders are indirectly or potentially impacted. The following stakeholder categories were thus targeted as part of the consultation strategy:

2.Consultation activities and tools

The consultation employed a mix of methods and tools to ensure a comprehensive and representative collection of views and experiences were gathered in relation to the problems aimed to be addressed by the initiative and the possible policy options.

The table below summarises the types and numbers of stakeholders consulted as part of the study, in line with the consultation strategy.

The main consultation activities that were conducted were as follows:

-A consultation on the inception IA, which was carried out by the Commission between 23 June 2020 and 1 September 2020. The purpose of this exercise was to collect views from stakeholders on the Commission’s initially intended direction of the Impact Assessment. In all, 77 entities submitted their feedback.

-An Open Public Consultation (OPC) that was open to all stakeholders and which included six main questions on the main obstacles and problems faced by consumers in the EU that prevents them from having a more active role in the green transition. The OPC was conducted by the Commission between 30 June 2020 and 6 October 2020. It received 315 responses. 131 .

-Targeted stakeholder consultations, consisting of interviews and surveys, which were conducted with relevant EU and Member State level stakeholders between June and October 2020. Five targeted questionnaires 132 and targeted interviews gathered feedback on the relevant aspects of the initiative and elements of the Impact Assessment. In all, 119 stakeholders participated.

-An industry survey consisting of (i) a long online survey that was distributed to more than 500 companies but which, despite all efforts, only yielded 10 responses (seven from manufacturers and three from retailers) and (ii) a CATI survey which was conducted to complement the online survey in view of the low response rate. The CATI survey was conducted in August/September 2020 and gathered responses from 164 companies. The CATI survey focussed on the impact and cost on industry of the different possible policy options.

-A consumer survey that ran between 6 and 30 August 2020 and which was targeted at consumers across all EU27 Member States plus the UK. A total of 11 805 consumers participated. The survey consisted of 45 questions covering respondents views on the problems and options covered by the initiative; experiences related to failures of goods from various categories; experiences with goods that did not last as long as expected; willingness to pay for information on durability and reparability and for goods that will last longer or that are easier to repair; behaviour related to and willingness to pay for sustainable products.

-A series of four workshops, including (i) an expert workshop with 10 independent experts, held on 9 July 2020; (ii) a workshop with 39 industry representatives to discuss the use of digital means to provide product information to consumers, held on 14 September 2020; (iii) a stakeholder workshop open to all stakeholders which involved 72 participants (from consumer associations, NGOs, industry associations and others) on 6 October 2020; and (iv) a workshop with CPC authorities on 14 October 2020 to delve into their experience in enforcement relating to green issues under EU consumer law, in particular greenwashing and premature obsolescence practices as well as on possible improvements.

3.Evidence, sources and quality

The Inception Impact Assessment (IA) was published on the Commission’s website on 23 June 2020 and feedback from consumers, industry and other stakeholders were invited until 1 September 2020. 77 responses were received, the majority from business associations (30%), NGOs (25%) and companies/business organisations (22%). Limited feedback was also received from public authorities (6%), consumer organisations (4%), EU citizens (4%), academic/research institutions (3%), environmental organisations (3%) and others (4%). The responses are publicly available.

The industry survey was originally intended to be an online survey with follow-up interviews. Over 500 companies were contacted through various means, but despite significant effort, only ten replied. In view of the low response rate, a CATI survey was launched. This yielded a higher level of participation, with 164 replies from retailers (50%), manufacturers (40%) and service providers (14%). To ensure maximum coverage and geographical balance, the survey was conducted across five markets: Italy (24%), Poland (22%), France (20%), Germany (18%) and Sweden (16%). It was carried out on an anonymous basis and results were processed and comprehensively analysed.

The targeted consultation was based on (i) semi-structured questionnaires (interviews) and (ii) an online questionnaire (survey). Stakeholders were selected based on their role and relevance to the study as per the consultation strategy. Careful attention was given to ensure a balanced representation between Member States and stakeholder categories. There were 119 respondents; over a third (37%) represented national authorities/bodies, 18% EU and national consumer organisations, 18% EU and national industry/business associations, 15% other stakeholders involved with labels, logos, information tools and other certification schemes, 10% other NGOs and research organisations and 3% EU and international authorities. The number of stakeholders initially contacted was significantly higher than the final numbers surveyed and interviewed, which may be the result of some ‘stakeholder fatigue’ and unavailability due to challenges related to Covid-19 and the timing of the consultation which ran during the summer period. The deadline of this consultation was extended (to October 2020) to allow more stakeholders to respond.

The Open Public Consultation yielded a relatively high response rate (315 replies). Nearly three quarters (73%) of the company/business organisations that responded were SMEs.

The consumer survey, with 11,805 participants, was representative of the EU27+UK population with a confidence level of 99%. The composition of the survey sample reflects the population in terms of share, age group and gender. The consumer survey was also undertaken on an anonymous basis and the results have been comprehensively processed and analysed.

The workshops provided an opportunity to validate the findings from the earlier consultation activities and to ensure the robustness of the results.

4.Main stakeholder feedback per consultation activity

The results from the consultation have been fed into the wider study, both to substantiate the assessment of the problems and for the assessment of possible solutions. The main feedback, per strand of consultation, is described concisely below. The main results per problem and per possible option/policy intervention are presented in more detail in Section 5 of this Annex.

4.1.Inception Impact Assessment

Feedback on the proposed EU initiative was generally very positive and most respondents believed it would help, over the longer term, to foster more sustainable behaviours. There was particularly strong support for EU action capable of (i) bringing about a common/harmonised approach to the provision of consumer information and (ii) removing unsustainable products from EU markets by, for example, making it easy for consumers to recognise such products. There was support for limiting the proliferation of environmental labels and claims to build credibility and limit confusion among consumers. Opinions were divided as to the various options presented in the Inception Impact Assessment, with stakeholders showing a slight preference for Option 2 (“a new stand-alone consumer protection instrument”) over Option 1 (“amend existing consumer protection legislation”) and over a combination of both Options 1 and 2.

4.2.Open Public Consultation

The ‘difficulty to verify the reliability of environmental claims (including climate related) on products’ was identified as the biggest obstacle to enhanced consumer participation in the green transition and towards a more sustainable consumption behaviour, though the extent to which this poses a barrier was perceived differently among stakeholder groups (58% of consumer organisations agreed, versus 23% of company/business organisations). The perception that environmentally-friendly products are more expensive was also identified as an important obstacle.

A large share of respondents (44%) had found it too expensive to repair (or cheaper to replace) products; thought there was a significant divergence in views among stakeholder groups. 76% of consumer organisations identified cost as the main barrier to repair, but only 12% of business associations agreed. Common problems that stakeholders had encountered when trying to repair products themselves included the price of spare parts being too high (23%), lack of user-friendly repair manuals (22%) and components being impossible to repair due to their product design (22%).

Most respondents had experienced the unexpected failure of a product in the last three years (24% had not). ICT products were identified as most problematic (47%), followed by small household appliances (20%) and clothing and footwear (19%).

‘Information about the reparability of the product’ was identified as the option most useful to enable consumers to choose more sustainable products and participate in the circular economy (selected by 41%). This was strongly favoured by public authorities (57%) and citizens (54%), but not by companies/business organisations (21%), who instead favoured the provision of ‘Information on the product’s life-cycle environmental and climate footprint’ (56%). This was also rated as the second-best option overall (39%).

Providing better information on products’ durability/lifespan was identified as the best option to empower consumers for the green transition (33% agreed). This was strongly favoured by consumer organisations (75%) and citizens (52%), but not by company/business organisations (16%) or business associations (14%), who favoured ‘Raising awareness about the role of consumers on circular economy and green transition’.

Providing ‘Detailed EU guidance for enforcement bodies against greenwashing and obsolescence practices and on enforcing consumer information rules’ was identified as the most effective option to improve enforcement of EU consumer laws to enhance participation of consumers in the green transition (selected by 36%).

4.3.Targeted stakeholder consultations

In relation to Problem 1, almost all stakeholders (except those representing industry) concurred with the view that consumers are not given, or do not have access to, information on products’ environmental impact; on the lifespan of goods and product-specific features that may lead to early failure; and on the availability of repair services spare parts and software updates/upgrades.

In relation to Problem 2, most consumer organisations and ‘other’ organisations considered that consumers’ are subjected to ‘greenwashing’ and that ‘premature obsolescence’ occurs to some extent; however, representatives from industry tended to disagree. The proliferation of sustainability labels and logos was also identified as a problem by stakeholders from most stakeholder groups.

Views from stakeholders on the possible solutions are presented in section 5.2 of this Annex below.

4.4.Industry survey

In the CATI survey, manufacturers and retailers were asked to indicate the scale of impact and cost on their organisation of the introduction of various legal requirements. Respondents were asked to provide a score on a scale of 0 to 5, where 0 represents ‘no impact’ and 5 indicates ‘very high impact’. Overall, it was indicated that an obligation to ‘Provide information on aspects in the product’s design that can cause its early failure’ would have the biggest impact (mean score of 2.61) and would be most costly (mean cost score of 2.25). In contrast, respondents indicated that ‘Stronger consumer protection against planned (intentional) obsolescence practices’ would have the lowest impact (scored 2.37) and that an ‘Obligation to provide information on the duration of the commercial guarantee for all products’ and an ‘Obligation to expressly inform the consumer that no commercial guarantee of durability is provided for the given product’ would be least costly (both with a mean cost score of 2.44).

4.5.Consumer survey

Consumers are seemingly open to participating in the green transition. Almost half (49%) said they would be happy to have a product repaired, rather than replaced, if it breaks down within the legal guarantee period; mainly ‘To reduce my environmental impact’ (selected by 63%) or because ‘It is the fair thing to do (44%). Respondents who preferred a replacement were concerned that the product may not be properly repaired (54%) or that a new product would last longer (46%).

Most respondents were unwilling to pay for information (e.g. via an app) on the durability and reparability of ‘durable goods’ 133 . Around half (47% to 51% depending on the product type) were willing to pay extra on top of the initial price for a product that lasts longer without having to be repaired; and a similar proportion (41% to 47%) were willing to pay extra for an identical product that lasts longer with minor/reasonable repairs (paid by the consumer). An even larger share (61% to 68%) were willing to pay extra for an identical product covered by a commercial guarantee that would cover the cost of repairs.

The ‘Perceived higher price of environmentally-friendly products’ was identified as the main obstacle that prevents consumers from adopting more sustainable behaviours (39%) and ‘Providing better information on products’ durability/lifespan’ (26%) and ‘Providing better consumer information on the life-cycle environmental and climate footprint of the product’ (23%) were identified as the most effective options to help consumers choose more environmentally sustainable products.

Results indicate that consumers are willing to pay extra for environmentally sustainable products, and even more so for products with claims validated by a trustworthy independent body.

4.6.Workshops

The expert workshop (held 9 July 2020) validated many of the findings from the other strands of consultation. It was largely agreed that greenwashing occurs and that information on product durability can be difficult to obtain. Doubts were raised that products are intentionally designed to fail early. Various barriers to reparability were identified including speed of repair, cultural factors and availability of spare parts.

The industry workshop on digital means (held 14 September 2020) highlighted some of the opportunities that digital tools (e.g. QR codes, e-labels) offer for conveying mandatory product information and simplifying product labels. It also highlighted some of the challenges, particularly for SMEs who may need financial support to implement these tools and for vulnerable consumers who do not have access to, or who cannot use, them.

The stakeholder workshop (held 6 October 2020) again reiterated many of the same points that were raised in the previous consultation activities.

Participants at the CPC workshop (14 October 2020) highlighted the difficulty of proving intent with regard to planned obsolescence. Public authorities noted that they lack the technical expertise to be able to enforce green claims, but were divided on whether enforcement of the current general EU consumer rules (UCPD) is effective.

5.Feeding the consultation results into the Impact Assessment

5.1.Extent of the problems

5.1.1.Problem 1: Consumers lack reliable information at the point of sale to make environmentally sustainable consumption choices

Sub-problem 1.1. Lack of reliable information on the environmental characteristics of products

Feedback received across the various strands of consultation strongly indicates that consumers lack information on the environmental characteristics and impacts of products, though this view was more strongly supported among consumers and their representatives than by industry.

In the consultation on the inception IA, 20 respondents (26%) commented on this problem and all acknowledged that the quality of information provided to consumers on the environmental characteristics of products is not optimal. A notable share (27%) of respondents in the OPC similarly indicated that it is difficult to check if products are environmentally friendly; though a much larger share of consumers (31%) and consumer organisations (42%) identified this as a problem versus companies (32%) and business associations (13%).

About a quarter of consumers that participated in the consumer survey identified “difficulty to check if products are environmentally-friendly” (29%) and “difficulty to verify the reliability of environmental claims (including climate related) on products” (25%) as key obstacles that prevent them from adopting more sustainable consumption behaviours. Only “perceived higher prices of environmentally-friendly products compared to less environmentally-friendly alternatives” was identified as a greater obstacle (39%). The OPC yielded a similar result, with “difficulty to verify the reliability of environmental claims (including climate related) on products” ranked first (33% respondents) and “perceived higher prices of environmentally-friendly products compared to less environmentally-friendly alternatives” ranked second (30%), though “difficulty to check if products are environmentally-friendly” was ranked fifth (27%).

In the targeted consultation, most (76%) respondents indicated that consumers lack awareness of the environmental impacts of products because the information is not provided, or not available. Only 14% (all industry associations) indicated that such information is generally provided. Results from the CATI survey, however, paint a somewhat different picture: 19% of respondents reporting providing information on the environmental impacts of all their products (48% for some or most). In the food and drink sector, 64% said that they do not provide this information at all.

Sub-problem 1.2. Lack of reliable information on the lifespan of goods

A lack of reliable information on the lifespan of goods was consistently identified as a problem across all strands of consultation. The problem was identified across most stakeholder groups; only stakeholders from industry tended to disagree.

In the consultation for the inception IA, all eight of the respondents who commented on sub-problem 1.2 acknowledged that information pertaining to products’ durability is either lacking or, where provided, is often unclear, unreliable and/or misleading. Similarly, in the OPC, over a quarter (27%) of respondents indicated that a lack of information on how long products will function without repair creates an obstacle to enhanced consumer participation in the circular economy and towards more sustainable consumption behaviour. There was, however, a strong divergence in views among the different stakeholder groups that participated in the OPC. Consumer associations (53%), academic/research institutions (44%), public authorities (39%), NGOs (37%) and citizens (33%), on the one hand, all thought that the lack of information on the lifespan of goods poses an important barrier to the green transition, but this was not the case for companies/businesses (15%) or business associations (8%).

Consumers believe that information on the lifespan of products is important for empowering their participation. In the consumer survey, “information on a ‘guaranteed’ product’s lifespan” was identified by nearly a third (30%) of respondents as being one of the most useful pieces of information to enable them to choose more sustainable products. 134 However, when buying large household appliances (49%), small household appliances (45%), electronic and IT products (55%), and furniture (51%), around half of consumers were not told the estimated lifespan of the product before being repaired and a substantial proportion (17% to 25% depending on the product group) were not told the length of the commercial guarantee. Furthermore, 49% to 55% of consumers were not told how long software updates and upgrades would be provided.

The CATI survey sought to explore in more depth whether manufacturers provide information on the expected lifespan of their products. Less than a quarter (23%) said that they provide this information for ‘all products’ and only 6% said yes ‘for most’. In contrast, nearly a third (32%) of manufacturers did not know the expected lifespan of their products and a further 17% said that they do not provide this information. The results from the CATI survey indicate that this information deficit is not being met by retailers either. Only 15% of retailers always provide information on the expected lifespan of products, where this information is not provided by the manufacturer. Just over half (59%) of retailers provide this information for some products. Nearly a third (30%) said that they provide information on ‘software updates/upgrade policy and period’.

In the targeted consultation, most stakeholders confirmed that consumers are not provided with information on either the lifespan of goods (without and with minor repairs).

Sub-problem 1.3. Lack of reliable information about products’ reparability

A lack of reliable information to support the repair, update and upgrade of products was consistently identified as problematic by consumers, their representatives and most other groups of stakeholders during the consultation. Contrary to this, representatives from industry mostly indicated that information on reparability is widely available.

In the consumer survey, around half of consumers said that they were not told how long spare parts would remain available (48% to 55% depending on the product group) Almost all consumer associations and other organisations consulted during the targeted consultation considered that information on the availability of repair services, on the availability of spare parts and on relevant software update/upgrades is not widely available to consumers. This finding also corroborates the information gathered in the earlier consultation for the inception IA, where most respondents acknowledged that consumers are not sufficiently made aware of products’ extent of reparability. Similarly, in the OPC, 33% of citizens, 53% of consumer organisations and 39% of public authorities ranked ‘difficulty to know how long products will function without repair’ as an important obstacle to enhanced consumer participation in the circular economy and towards more sustainable consumption behaviour.

The view from industry was somewhat different, however. In the OPC, only 8% of business associations and 15% of company/business organisations thought that a ‘difficulty to know how long products will function without repair’ creates an obstacle to enhanced consumer participation in the green transition. Similarly, during the targeted consultation, most industry associations felt that information relating to reparability is widely available. Nearly half (45%) of manufacturers in the CATI survey claimed to provide information on the ‘period in which spare parts will be available’, 40% said that they provide information on the ‘period in which repair services will be available’.

5.1.2.Problem 2: Consumers face misleading commercial practices related to the sustainability of products

Sub-problem 2.1. Consumers are sold products that do not last as long as they could or consumers expect (“early obsolescence”)

Across the different strands of consultation, most stakeholder groups (including consumers and their representatives, but not those representing industry) considered that premature obsolescence occurs to some extent; though most also believed that product failure is not necessarily planned. Based on feedback in the consultation for the inception IA, planned obsolescence is a practice that has become more commonly discussed over time. However, enforcement authorities were unable to provide any information on how often it occurs.

Product failure appears to be a common problem. In the OPC, most respondents indicated that they had experienced the unexpected failure of one or more products in the past 3 years; with ICT products identified as being most problematic. Nearly half the participants (47%) said that they had experienced the unexpected failure of an ICT product in the last 3 years. All (100%) consumer associations, 73% of public authorities and 66% of companies/businesses said that they had experienced such a failure.

Independent experts consulted during the targeted consultation indicated that while products may be failing earlier than they should, this may not be linked to an intention of companies to increase their replacement rate. In the long industry survey, two participants who commented on intentional obsolescence claimed not to apply such practices; though this may not be representative of industry practice as a whole. Industry representatives also questioned whether shorter lifespans are linked solely to the choices of manufacturers, rather than to consumer behaviour, such as poor maintenance and increased use.

While most stakeholders were convinced of the existence of obsolescence practices, most also considered them difficult to verify.

When asked whether they were told by the seller about known weaknesses that might cause a product to fail prematurely, consumers indicated that sellers generally do not provide this information. Results from the consumer survey indicate that information about potential weaknesses is provided only a quarter of the time (20%) for large household appliances, 30% of the time for small household appliances, 17% of the time for electronics, and 26% of the time in the case of furniture.

Sub-problem 2.2. Consumers are faced with the practice of making unclear or not well-substantiated green claims (“Greenwashing”)

The view of most respondents across all the different strands of consultation was that greenwashing is a problem; only industry representatives tended to disagree.

In the consultation for the inception IA and the targeted consultation, the majority of participants (except those representing industry) recognised that greenwashing has become an important and persistent problem that is impeding consumers’ ability to choose more sustainable products. This coincides with the results from the OPC, in which 33% of respondents selected "difficulties to verify the reliability of environmental claims (including climate related) on products" as a relevant obstacle to enhanced consumer participation in the circular economy and towards more sustainable consumption behaviour. Over half (58%) of consumer organisations and 36% of citizens selected this as a relevant obstacle.

Unfounded or unsubstantiated environmental labels and claims were also identified by various stakeholders (including consumer organisations and public authorities) as misleading consumers. Their feedback indicates that information is deliberately manipulated (e.g. using general and vague terms) rather than being completely false. Industry associations, however, tended to disagree that the practice of ‘greenwashing’ is prevalent. Public authorities noted (at the CPC workshop) that they often find it difficult to prove that environmental claims are unfounded or unsubstantiated because they lack the technical knowledge to analyse the evidence provided by traders.

In the consumer survey, 70% of respondents indicated that they would report a misleading or false claim about how environmentally friendly a product or service is. The most common reason cited for not reporting a misleading or false claim was a belief that complaining would not have an impact.

In contrast, most industry representatives disagreed with the assertion that greenwashing is problematic. In the OPC, less than a quarter (24% of business associations and 23% of companies/businesses) selected "difficulties to verify the reliability of environmental claims (including climate related) on products" as a relevant obstacle towards more sustainable consumption behaviour.

Sub-problem 2.3. Consumers are faced with the use of sustainability labels and digital information tools that are not always transparent and credible

In the consultation for the inception IA and the targeted consultation, most respondents identified the proliferation of sustainability logos, labels and other claims as an important and persistent problem across the EU. Similarly, in the OPC, over a quarter (27%) of participants selected "the proliferation and/or lack of transparency/ understanding/reliability of sustainability logos/labels on products and services" as a relevant obstacle to empowering consumers for the green transition. Interestingly though, it was industry representatives that were more likely to identify this as a problem than consumers and their representatives. Moreover, 34% of businesses identified the "the proliferation and/or lack of transparency / understanding / reliability of sustainability logos / labels" as an obstacle versus only 27% of citizens and 16% of consumer organisations. In the consumer survey, only 16% of consumers identified this as an obstacle to adopting more sustainable consumption behaviours. 135  

This issue has been amplified by the rapid emergence of a number of (private/voluntary) labelling schemes at national / Member State level, making comparability across products increasingly difficult for consumers. In addition, there are concerns among stakeholders interviews that not all labels are certified or validated (by a recognised institution), which may thus be driving consumers to choose products that are not necessarily “green.”

In comparison to issues around logos/labels, far fewer stakeholders identified ‘the proliferation and/or lack of transparency/understanding/reliability of IT tools’ as being problematic. In the OPC, only 8% of respondents identified this as an important obstacle and a similar percentage of respondents in the consumer survey (9%) identified the ‘Proliferation and/or lack of transparency/understanding/reliability of IT tools (e.g. consumer apps) that provide advice for a more sustainable consumer behaviour’ as an obstacle that prevents them from adopting more sustainable consumption behaviours.

5.2.Views on possible options/policy interventions

5.2.1.Problem 1: Consumers lack relevant information at the point of sale to make environmentally sustainable purchases

Sub-problem 1.1. Lack of reliable information about products’ environmental characteristics

In the consultation for the inception IA, most of the 38 respondents who commented on potential solutions to sub-problem 1.1 seemed to favour the idea of making changes to the information requirements surrounding the environmental characteristics of consumer products, though respondents held different views on how to go about it.

In the OPC, 39% of respondents indicated that it would be useful to have information on the product’s life-cycle environmental and climate footprint. This reflects the results from the targeted consultation, in which most respondents (across all stakeholder categories) indicated that requiring an indication of the overall environmental performance of products would be most effective.

In the targeted consultation, most business associations (four out of five) thought that an option to mandate the indication of the overall environmental performance of products would be at least somewhat feasible, though three thought that the option would entail high costs and two moderate costs. Various challenges were also identified, including a risk that the option may unfairly impact certain product categories. There was a view from the industry that current information requirements (such as those from the CRD) are already appropriate and sufficient. A majority (five out of six) of the public authorities that provided a view believed that the option would be at least somewhat effective.

In the CATI survey, manufacturers and retailers were asked to indicate the scale of impact 136 on their organisation of the introduction of a legal ‘obligation to provide information on environmental characteristics of products’. The average (mean) score given was 2.55. Although this represents only a moderate impact, it is of note that, of all the possible legal requirements proposed, this was given the highest impact score. Manufacturers and retailers were also asked about the costs of introducing a legal requirement to provide information on the environmental characteristics of products. This option was also estimated to be the costliest, with a score of 2.75 (out of 5).

Sub-problem 1.2. Lack of reliable information about products’ lifespan

In the consultation for the inception IA, stakeholders (except those representing industry) generally indicated that information on durability can help consumers adopt more sustainable behaviours. However, it was also recognised that the nature and extent of information to be provided on durability ought to be carefully thought out.

In the OPC, ‘providing better consumer information on products’ durability (lifespan)’ was selected as the most effective option to empower consumers for the green transition (33% respondents). Further, when asked what information would be most useful for consumers to choose sustainable products, over half said ‘information on products’ lifespan’, either as a guaranteed lifespan (28%), expected lifespan (19%) and/or lifespan with minor reasonable repairs (11%). Citizens were most likely to select this option and company/business organisations were least likely. A similar finding was reflected in the consumer survey, in which ‘information on the ‘guaranteed’ product lifespan’ was selected by consumers (30% of respondents) as one of the two most useful pieces of information to help them choose sustainable products (the other being ‘information on the products’ life-cycle environmental and climate footprint’). In the targeted consultation, 15 out of 17 public authorities considered that a requirement to provide an ‘indication of the availability of an additional commercial guarantee of durability (beyond the statutory legal guarantee)’ would be an effective option, 14 out of 17 thought it would be easy to enforce, and 11 out of 16 thought it would be easy to monitor. 137

In the CATI survey, manufacturers and retailers were asked to indicate the scale of impact on their organisation of the introduction of a legal ‘obligation to provide information on the expected lifespan of products without repair for all products’. The mean score given was 2.53. In terms of costs, the option was given a score of 2.30. Manufacturers and retailers were also asked to indicate the scale of impact and costs on their organisation of a legal ‘obligation to provide information on the duration of the commercial guarantee for all products’. This was given a mean impact score of 2.12 and cost score of 2.04, making it the lowest impact and one of the least costly options proposed.

Sub-problem 1.3. Lack of reliable information about products’ reparability

There was general acceptance across all stakeholder groups that environmental information provided to consumers should cover reparability.

In the OPC, just under a quarter (22%) of participants selected ‘providing better consumer information on products’ reparability’ as an effective option, though there were big differences between the views of different stakeholder groups. Two thirds (65%) of consumer associations and 35% of citizens thought that this option would be effective, but only 3% of business associations and 5% of companies agreed. Nearly half the respondents in the OPC (48%) said that ‘information about the reparability of the product (e.g. repair scoring, availability of spare parts, repair manuals, repair services…)’ would be an effective option. The results from the targeted consultation support these findings. In the targeted consultation, all stakeholders thought that an option to inform consumers about the availability of spare parts would be at least somewhat effective.

In the CATI survey, manufacturers and retailers were asked to indicate the scale of impact on their organisation of the introduction of an ‘obligation to provide information on availability of repair services’ and ‘availability of user-friendly repair manuals’. These options were given a mean impact score of 2.41 and 2.44 respectively (out of 5). In terms of cost, respondents in the CATI survey gave both these options a mean score of 2.14.

In the targeted consultation, some respondents also discussed potential challenges associated with the proposed options. Among business associations, there were concerns that misleading information would be provided to consumers from retailers, notably about reparability. These respondents felt that manufacturers would be better placed to provide that information as opposed to sellers or retailers. Furthermore, some business associations warned against the potential information overload that may result from additional information requirements. Finally, some public authorities highlighted that information on reparability may not prove effective in encouraging repairs / reuse if buying a new product is much cheaper to consumers.

5.2.2.Problem 2: Consumers face misleading commercial practices related to the sustainability of products

Sub-problem 2.1. Consumers are sold products that do not last as long as they could or consumers expect (“early obsolescence”)

In the consultation for the inception IA, there was a general acceptance that early obsolescence practices should be more formally addressed by law. However, results from the OPC indicate a divergence in views across stakeholder groups. Two thirds (65%) of consumer associations identified ‘providing a stronger protection against practices that cause products to fail earlier than can normally be expected (so-called "early and planned obsolescence")’ as an effective option to empower consumers to play their role in the green transition and 35% of citizens and 28% of public authorities agreed. However, only 3% of business associations and 5% of companies/businesses thought that this option would achieve the desired goal. The prevailing view among business associations was that the costs entailed by the proposed option would be high.

In the CATI survey, manufacturers and retailers were asked to indicate the scale of impact on their organisation of the introduction of ‘stronger consumer protection against premature obsolescence practices’ and ‘stronger consumer protection against planned (intentional) obsolescence practices’. These options were given a mean impact score of 2.55 and 2.37 respectively (out of 5). The highest score was given for ‘small household appliances’. In terms of cost, respondents in the CATI survey gave ‘stronger consumer protection against premature obsolescence practices’ a mean score of 2.13. The highest cost score was for ‘large household appliances’.

However, public authorities raised concerns about the enforcement of options aimed at curtailing the practice of planned obsolescence. They noted that it may not be possible to prove planned obsolescence, and that they lack the required product knowledge.

Sub-problem 2.2. Consumers are faced with the practice of making unclear or not well-substantiated environmental claims (‘greenwashing’)

The consultation has highlighted an interesting divergence in views between citizens/consumers on the one hand, who do not feel they are being ‘greenwashed’, and consumer organisations on the other who are concerned that consumers need stronger protection against unclear or unsubstantiated claims. Only 17% of citizens in the consumer survey identified ‘providing a stronger protection against greenwashing (i.e. claims on environmental qualities of products or services that are exaggerated, too vague, false or impossible to prove’ as an effective option to empower consumers to the green transition. 138 In contrast, 45% of consumer organisations in the OPC thought that this option would be effective.

When asked which information is most useful for consumers to choose sustainable products and participate in the circular economy around 17% of respondents indicated that “recommendations about the sustainability (i.e. environmental, social aspects included) of the product by a trusted public or private source (e.g. a public authority, expert, celebrity, friend)” are useful for consumers. Citizens (24%) and company/business organisations (23%) indicated that such recommendations are useful for consumers, but only 10% of consumer organisations and 11% of public authorities and ‘other’ organisations agreed.

In the consultation for the inception IA, most respondents stressed the need for a common or harmonised methodology for calculating or estimating products’ environmental impacts. Stakeholders believed that this would facilitate certification or validation and prevent unsubstantiated environmental claims and labels from being advertised.

In the targeted consultation, stakeholders were asked their views on two options: banning claims that are too vague unless they are substantiated and banning claims that are not based on a series of specific criteria. Most thought that the proposed options would be highly effective, and most business associations also thought the options would be ‘somewhat feasible’. Industry representatives were, however, concerned that the options would entail high costs. Most public authorities thought that it would be ‘somewhat easy’ to enforce. However, some warned against challenges with enforcement and monitoring if: (1) the options are defined in a too general way; and (2) no adequate metrics are defined against which to test whether a claim is unfounded / unsubstantiated. Some of the interviewed CPC authorities even indicated that the measures might lead to savings as it will help them to prove the practice of “greenwashing” more easily (less resources are needed to substantiate their assessment).

Some of the other challenges commonly discussed, notably by business associations, related to the need for developing sector-specific approaches to testing and validating green claims across industries and sectors (owing to product differences). There would also be a need to engage with all relevant stakeholders within an industry. It was noted that, where views diverge, this could slow down the process of developing the necessary measurement criteria for validating environmental claims.

In the CATI survey, manufacturers and retailers were asked to indicate the scale of impact and cost on their organisation of ‘banning some practices related to greenwashing’. This option was given a mean impact score of 1.91 and cost score of 2.08 (both out of 5, with 5 representing the highest impact/cost). Interestingly, an option ‘banning vague environmental claims unless they are verified/certified by independent authority/or based on recognised assessment methodology’ was deemed to be less effective (score of 1.83) and more costly (score of 2.17). In contrast, an option ‘setting in EU consumer law specific requirements for green claims’ was indicated to be more effective (2.09) but also more costly (2.38).

Sub-problem 2.3. Consumers are faced with the use of sustainability labels and digital information tools that are not always transparent and credible

In the consultation for the inception IA, most respondents generally favoured the introduction of tighter rules for the verification and validation of sustainability labels, logos and claims. However, there was less support for a single EU environmental label that would capture all sustainability aspects pertaining to a product.

Nearly a quarter of respondents (23%) in the OPC similarly identified ‘providing a greater transparency and reliability for sustainability logos/labels (i.e. covering environmental and social aspects)’ as an effective option to enable consumers to play their role in the circular economy. In contrast, only 7% selected “providing a greater transparency and reliability for IT tools (e.g. consumer apps) providing advice for a more sustainable consumer behaviour”. Companies/businesses were the stakeholder types most likely to identify both these options as effective.

In the targeted consultation, stakeholders were asked their views on an option ‘setting minimum requirements (on transparency, reliability, etc.) for, and possibly certify, sustainability labels/logos’. Most consumer associations thought that the proposed option would be ‘somewhat effective’ and other stakeholder groups were even more positive. Most business associations, public authorities and other stakeholders indicated that the option would be ‘highly effective’. Most business associations also indicated that the proposed option would be ‘feasible’. However, there was also some concern that it could entail high costs.

Eight out of fifteen public authorities believed that the option would be ‘somewhat easy to enforce’ 139 and seven out of 13 thought it would be ‘easy to monitor’ 140 . One public authority noted that there can be many criteria for third-party certification schemes and that this creates a challenge for enforcement. Another noted that enforcement and monitoring may require in-depth technical knowledge of each specific product/sector, which enforcement authorities often lack. In fact, some of the interviewed CPC authorities even indicated that the measure might lead to savings as it will help them tackle the issue of lack of transparency and reliability of labels/logos more easily (less resources are needed to substantiate their assessment).

In the CATI survey, manufacturers and retailers were asked to indicate the scale of impact on their organisation of the introduction of an option ‘setting minimum criteria for sustainability labels/logos to ensure that consumers can trust and rely on them’. This option was given a mean impact score of 2.37 (out of 5), indicating a moderate expected impact. In terms of cost, respondents in the CATI survey gave a mean score of 2.61, indicating a moderate expected cost.

In addition to the formal consultation process described in this Annex, consumer organisations have made it known that in particular in relation to sub-problems 1.2, 2.1 and 2.2, they would prefer measures which are more ambitious than the preferred policy options that have been selected in this Impact Assessment. 141

Annex 3: Who is affected and how?

1.Practical implications of the initiative

Consumers would be positively affected by the initiative. Consumer decision making would increase thanks to the options aimed at improving the availability of information at the point of sale about the existence and length of producer’s commercial guarantees of durability, about the period of availability of free software updates and about the reparability of products. It would also increase thanks to the options aimed at tackling greenwashing and unreliable and non-transparent sustainability labels. Consumer protection would also improve as consumers will be able to opt in a more transparent way for products with extended commercial guarantees if that would suit their needs. They would also be better protected from misleading environmental claims and products that fail early. In turn, this would lead to higher consumer trust in the market, and notably in more sustainable products. Overall, the monetisable consumer welfare would be quite consequent, primarily because consumers would save money on products that last longer and can be repaired more easily.

The impacts on the environment would also be positive. The options would guide consumers towards these products that are the most sustainable. Thanks to the preferred options, products would also be expected to last longer and be repaired more often than they are now. This would in turn lead to higher circularity, less CO2 emitted in production and fewer other negative environmental impacts.

The impacts on sellers and producers would be two-fold. On one hand, they would incur higher costs, particularly linked to obligations to provide certain information, for instance, on the existence of a producer’s commercial guarantees of durability or on reparability. However, these extra costs would be limited considering the average prices of the products concerned, and, even though they would likely be passed on to consumers, they are unlikely to affect the demand. On the other hand, options to address greenwashing and early obsolescence would also improve the level-playing field between companies as businesses that currently mislead consumers would have to align their practices with those that are truly sustainable. In addition, as several Member States have enacted or are in the process of adopting specific legislation on durability or reparability information or obsolescence, the preferred options would reduce barriers to cross-border trade within the Single Market and ensure that companies active on the Single Market play by the same rules. The initiative would also have an impact on organisations running sustainability labels as they would have to comply with new requirements increasing the transparency and credibility towards consumers. These costs are likely to be passed on to the companies applying for such labels.

Public authorities would face higher costs particularly linked to the monitoring and enforcement of the preferred options. However, the options have also been designed to render enforcement easier: for instance, on greenwashing, authorities have mentioned that the options considered could even lead to savings as it will help them to prove the practice of “greenwashing” more easily.

There are also other parties who may be affected by the measures introduced by this initiative, but who were not considered in the analysis because the corresponding impacts were considered minor and therefore not selected in the screening of impacts. One such category is Third Countries. It can be estimated that the level playing field established by this initiative would also bring benefits to businesses located in Third Countries, as those businesses that currently mislead consumers would also have to align their practices with those that are truly sustainable in order to sell their products on the EU market in conformity with the measures selected. Furthermore, none of the preferred policy options selected would negatively impact Third Country trade, as the requirements selected are of such a nature as to be easily complied with by traders located in Third Countries. The screening of impacts is further specified in Annex 4.

2.Summary of costs and benefits

All figures presented below are for the entire period 2025-2040 for the entire EU-27, explaining the high values.

Disaggregation of costs of preferred options:

3.Relevant sustainable development goals

Annex 4: Analytical methods

This annex provides information on the methods used in this Impact Assessment, namely:

-On the calculation of consumer detriment and environmental impacts;

-On the selection of the impacts against which the options are assessed and explanation on how the assessment is performed (including the approach to the monetisation of costs and benefits);

-On the comparison of the options by way of a cost-benefit analysis and multi-criteria analysis.

1.Selection of criteria and sub-criteria for assessing the impacts of the policy options 

1.1.Identification of impacts

In line with the European Commission’s guidance on Impact Assessment (as set out in the ‘Better Regulation Guidelines,’), all of the impacts (potentially) associated with the selected options/ options were identified (0). The process of identifying impacts was mainly informed by the literature review and stakeholder consultation. It also drew on expert input/ judgment.

The starting point for the development of the ‘long list’ of impacts was the “impacts checklist,” as set out in the ‘Better Regulation Guidelines’ (Tool #19). This was based on an in-depth analysis and understanding of all available evidence, which in turn minimised the risk of failing to consider potentially significant impacts. Specifically, the identification of impacts accounted for:

-Positive and negative impacts;

-Direct and indirect effects (stemming from changes in costs and product substitution);

-Intended and unintended consequences. Specifically, intended consequences include: benefits for consumer protection and the Single Market, while possible unintended consequences could include: impacts on the structure of the market;

-Short and long -term effects – e.g. short-term costs of providing information and long-term costs of reformulating products and/or commitments.

Table 1. ‘Long list’ of impacts