Impact of Legal Regulations on the Plastics Industry

Impact of Legal Regulations on the Plastics Industry
Impact of Legal Regulations on the Plastics Industry

The European Green Deal is forcing the plastics sector into a radical transformation centered on recycling and sustainability. New regulations are turning environmental responsibilities from a preference into an obligation for manufacturers. The Green Deal confronts plastic manufacturers with environmental responsibilities. Now, sustainability is the most critical criterion for competition!

Att. Ayşe Sırma ÖZBERBER

Sustainability, Energy and Climate Law Expert

The EU Green Deal (European Green Deal), approved by the EU Commission in 2020, brought with it new regulations that will affect both the states in the European Economic Area and third-party states with which the EU conducts commercial relations. While the new regulations introduced within the framework of the Green Deal have impacted many sectors in line with the sustainability objective, the plastics industry has become one of the most prominent areas of this transformation.

Beyond its primary goal of becoming a carbon-neutral continent by 2050, the Green Deal also encompasses sub-goals such as promoting the circular economy, efficient use of resources, and protecting biodiversity. Therefore, it is possible to say that the regulations accompanying the Green Deal have significant impacts on industry, agriculture, transportation, finance, and many other sectors. Furthermore, these regulations concern not only the EU's internal market but also its external trade. Particularly, regulations such as the Carbon Border Adjustment Mechanism and the Single-Use Plastics Products Directive (SUP Directive) directly affect both producers within the EU and countries trading with the EU.

NEW REGULATIONS

One of the most notable regulations following the Green Deal is the Single-Use Plastics Products Directive, which entered into force in 2021. With this directive, we see significant restrictions, even outright bans, on the use of products such as straws, cutlery, plates, and cotton swabs. A new obligation introduced with the Directive is the design of PET bottle caps to be attached to the bottle. This practice, which becomes mandatory from 2024, stands out as an important change for plastic product manufacturers. In addition, the Directive stipulates that as of 2025, all PET bottles must contain at least 25 percent recycled plastic content. In 2030, this rate increases to 30 percent. The main objective of these regulations is to encourage raw material circularity by increasing demand for the recycling market. 

Another important regulation is the Packaging and Packaging Waste Regulation. This regulation requires plastic packaging manufacturers to calculate the environmental impacts of their products throughout their life cycle and to ensure their recyclability. All these obligations require a significant transformation for plastic manufacturers, not only environmentally but also financially and operationally.

EXTENDED PRODUCER RESPONSIBILITY

The principle of Extended Producer Responsibility (EPR) is an application parallel to the “polluter pays” approach, which is encountered in many different regulations under the Green Deal. Within the scope of this aforementioned extended responsibility, manufacturers are now responsible not only for production but also for post-waste stages. In this context, manufacturers must make a financial contribution to waste management, cleaning, and public information costs arising from their products becoming waste.

In other words, with the SUP Directive, Extended Producer Responsibility makes plastic manufacturers directly responsible not only during the production phase but also for the post-use environmental impacts of their products. Now, the manufacturer must also consider how every piece of plastic they put on the market, from packaging to wet wipes, from cigarette filters to fishing nets, will be collected from the streets, how it will be sorted, and how this will be communicated to the public.

Considering all this, it is now possible to say that manufacturers are obliged to contribute financially not only to waste management costs but also to campaigns aimed at increasing cleaning and environmental awareness. This, of course, means that new items are added to the cost categories of companies operating in the plastics sector. It is no longer just about quality and cheap production; we can say it is also a competitive process measured by environmental sustainability performance. This situation creates significant compliance pressure, especially for small and medium-sized manufacturers, while making it almost mandatory for large manufacturers to invest in recycling infrastructures.

CBAM COMES INTO FORCE IN 2026

The EU Carbon Border Adjustment Mechanism (CBAM) will come fully into force as of 2026. With this regulation, carbon emission limitations that manufacturers producing within the EU must comply with will also apply to products manufactured outside the EU but exported to the EU. Otherwise, these products will be taxed according to their carbon content at the border.

Although CBAM is initially limited to sectors such as cement, iron and steel, aluminum, fertilizers, electricity, and hydrogen, it seems highly probable that plastic and petrochemical products will also be included in the scope after 2026.  Moreover, even if the plastics industry is not directly covered by CBAM, it is indirectly affected due to production methods with high carbon footprints. For example, if the petrochemical raw materials used in plastic products have high carbon intensity, these products risk being at a disadvantage in the EU market. Therefore, manufacturers will have to invest not only in the physical quality of the product but also in the environmental sustainability of the production process.

GREEN DEAL: RISK OR OPPORTUNITY?

A large portion of Turkey's plastic production processes are still fossil fuel-based, and recycling rates are below the EU average. Furthermore, when an assessment is made based on criteria such as life cycle analyses, carbon calculations, and environmental impact statements required for compliance with the Green Deal regulations, we see that most companies are not ready for this transformation. However, it is possible to change this situation positively. This is because the Green Deal offers the plastics sector not only sanctions but also opportunities. For example, areas such as bioplastics, compostable packaging, and innovative recycling technologies are among the markets that will grow rapidly in the coming period. Therefore, EU funds offer significant incentives to companies engaged in sustainable production. The green transformation funds provided by the EU offer serious grant and incentive opportunities, especially for companies investing in R&D, conducting sustainability reporting, and committing to carbon reduction. In Turkey, it is possible to apply for these funds directly or through framework programs such as Horizon Europe and IPA. In fact, many EU countries are actively looking for partners for projects that will help external companies integrate into their supply chains to raise their “environmental compliance” level.

In short, companies that adapt to the transformation can become part of a process that will not only eliminate risks but also increase their competitiveness, open new export channels, and strengthen their brand value in the long term. Therefore, companies that adapt to the transformation have the potential to gain advantages in new markets.

Who is Att. Ayşe Sırma Özberber?

She specialized in European Union Law by completing her master's degree at Marmara University's European Union Research Institute. She conducts studies on legal regulations that have come into force in the areas of sustainability, energy, and climate change, especially the European Green Deal. Özberber, who shapes her legal practice around environmental and social responsibility, particularly carries out work in ESG (environmental, social, governance) consulting.

Özberber, who worked as a lawyer at PricewaterhouseCoopers for over five years, contributed to various studies and conferences in the ESG field there. Currently continuing her independent legal practice, Özberber is pursuing her doctoral studies on sustainability and law at Istanbul Medeniyet University. She closely monitors legal developments in Turkey and continuously updates her professional practice in line with the needs of the era. 

This content has been translated using artificial intelligence technology.