Bureaucracy in the EU: no longer a commodity

Starting from August, small online sellers in Europe face growing challenges as new EU packaging regulations come into force. The rules, part of the EU’s broader effort to reduce environmental harm and protect public health, target the use of harmful substances such as PFAS, often called “forever chemicals”, in food-contact packaging. These chemicals, known for their persistence in the environment and potential long-term health risks, are commonly used to make paper and cardboard resistant to grease and water. Under the new Packaging and Packaging Waste Regulation (PPWR), all new packaging intended for food contact must meet stricter standards, reducing PFAS levels to minimize migration into food or the ecosystem. The regulation applies to all new packaging products entering the market after August. While existing packaging does not need to be recalled or destroyed, businesses must comply with updated sustainability requirements. This includes registering packaging in multiple EU member states, often with associated fees. For many small businesses and online traders, the administrative burden and financial implications are proving overwhelming. Some have even suspended operations within the EU due to the complexity of compliance. The German online retailers’ association, Händlerbund, has expressed concern over the lack of exceptions for small businesses. It warns that there is no minimum threshold for compliance, meaning even minor operations must navigate the same regulatory maze as larger companies. EU lawmakers, including Elisabeth Dieringer of the far-right Freedom Party of Austria, have highlighted the disproportionate impact on medium-sized firms, estimating potential costs in the hundreds of euros per country. She described the situation as one where smaller businesses “have little choice but to ‘eat or die.’” Small business owners, particularly those operating online stores, have voiced frustration over the requirement to appoint authorized representatives in each EU country they operate in. One such entrepreneur, who runs Monstaas Workshop, noted that the annual cost per country could reach approximately €300. Such expenses are considered unaffordable for many independent operators. Similarly, Swedish electronics manufacturer iLabs Electronics announced it would stop accepting web orders from EU countries, citing the increasing cost and administrative strain as being “out of proportion” to their direct sales volume. The issue extends beyond individual businesses. A petition on change.org, calling on Brussels to reconsider the impact of these rules on micro-businesses, has gathered support from over 45,000 signatories. Advocates argue that the new rules, while well-intentioned, risk undermining the very cross-border trade they aim to facilitate. Critics suggest that the regulations, though aimed at improving sustainability and public health, may inadvertently stifle innovation and growth among smaller enterprises. Environmental concerns remain central to the debate. According to the European Commission, EU nations have seen a 20% increase in packaging waste over the past decade. Without intervention, projections indicate a further 19% rise by 2030, driven largely by the surge in e-commerce and ready-to-eat foods. In 2023 alone, the average person in the EU generated 178 kilograms of packaging waste, with 35.3 kilograms of that being plastic, only 42% of which was recycled. Germany, for instance, recorded 215 kilograms of packaging waste per capita, underscoring the scale of the challenge. As the new rules take hold, the immediate focus is on how quickly businesses can adapt. Some may struggle to meet the demands of registration and compliance, potentially leading to reduced activity or withdrawal from the EU market. Meanwhile, the broader conversation continues about balancing environmental goals with economic realities, especially for smaller players in the digital economy. What remains clear is that the new regulations mark a turning point, one that could either strengthen the EU’s green agenda or expose deep tensions between regulatory ambition and practical implementation.