Regulation (EU) 2025/40, the Packaging and Packaging Waste Regulation (PPWR), was published in January 2025. It replaces the Packaging Directive 94/62/EC and applies directly in every EU Member State, creating one legal framework for packaging across the Union.
The regulation sets out to make all packaging reusable or recyclable by 2030, reduce the environmental and health impacts of packaging, and move the sector towards a circular economy.
Its obligations are binding and they run the length of the value chain, from manufacturers and importers through to distributors. They cover recyclability, mandatory recycled content, reuse systems, harmonised labelling, and packaging minimisation.
This guide covers the PPWR's rules, its timeline, and what compliance asks of businesses. The second half deals with mass balance accounting, which is how companies track and verify recycled content when it comes from chemical recycling.
What is the PPWR and what is it for?
The PPWR was adopted on 19 December 2024 and published on 22 January 2025, replacing the long-standing Directive 94/62/EC on packaging and packaging waste. Unlike a directive, which required each Member State to implement its own national legislation, the PPWR is a regulation. This makes it directly applicable across the EU, creating a uniform legal framework for all packaging placed on the Union market (Article 71; Recital 3).
The shift from a directive to a regulation is one of the most significant changes. It is intended to harmonise rules across Member States and remove the internal market barriers that fragmented national measures created. Economic operators, from manufacturers to importers, can now rely on a single, coherent set of rules throughout the EU (Recital 3).
The PPWR works alongside three existing EU policies:
- The European Green Deal
- The Circular Economy Action Plan (CEAP), which commits to making all packaging reusable or recyclable by 2030
- The Chemicals Strategy for Sustainability, which addresses the reduction of substances of concern in packaging
The regulation's first objective is to harmonise packaging rules across the single market by removing the national discrepancies that created barriers for businesses and undermined efficiency. Manufacturers, importers, and distributors can rely on one uniform set of packaging requirements throughout the EU.
The second objective is environmental. The PPWR sets out to prevent and reduce the negative impacts of packaging on the environment and human health, and it does so across the full life cycle, from design and production through to collection and recycling. The commitment to make all packaging either reusable or recyclable by 2030 sits at the centre of this.
A third objective is to cut excessive and unnecessary packaging, favouring designs that use fewer resources while improving recyclability. For plastics, Europe's most carbon-intensive packaging material, the regulation drives the uptake of recycled content and reduces dependence on virgin materials. Lower material use and greater circularity feed directly into EU climate objectives, including the reduction of greenhouse gas emissions from packaging production, transport, and waste management.
What is the timeline of implementation for PPWR?
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The PPWR phases its requirements in over more than a decade, which gives businesses a long adaptation period. It was published in January 2025 and entered into force in February 2025, with general application starting in August 2026. Harmonised labelling is scheduled for 2028-2029, depending on the implementing acts.
From January 2030, the first major obligations take effect. Only packaging with recyclability grades A-C may be marketed, minimum recycled content thresholds apply to plastic packaging, and packaging minimisation requirements come into force. By January 2035, recyclability must be demonstrated in practice at scale. By January 2038, only grades A and B remain permitted, which phases out all lower-performing packaging.
The staged timeline gives companies room to audit existing packaging, secure recycled content, develop reuse systems, and get documentation processes in place well before enforcement tightens.
Who and what does the EU Packaging and Packaging Waste Regulation (PPWR) apply to?
The PPWR applies to all packaging placed on the EU market, regardless of the material, the function, or whether the packaging is empty or filled with products. This includes:
- Business-to-business (B2B) and business-to-consumer (B2C) packaging;
- Household, commercial, industrial, e-commerce, and transport packaging;
- Packaging produced within the EU and packaging imported from third countries.
The scope closes gaps under the previous directive that let some products avoid packaging rules altogether.
The regulation also gives clear and harmonised definitions for packaging categories, which matters for legal certainty and for uniform enforcement across Member States. It distinguishes:
- Sales packaging (primary): Packaging conceived to constitute a sales unit for the end user or consumer at the point of purchase.
- Grouped packaging (secondary): Packaging designed to group a number of sales units, either to facilitate handling or stocking, or to be sold as a multi-pack.
- Transport packaging (tertiary): Packaging designed to facilitate handling and transport, preventing damage to goods in transit, but excluding containers used for transport by road, rail, air, or sea.
- Service packaging: Packaging filled at the point of sale to allow or facilitate the delivery of goods to the consumer, such as takeaway coffee cups or sandwich bags.
- Composite packaging: Packaging made of different materials which cannot be separated by hand into single-material components.
These definitions are essential because they determine which rules apply to which type of packaging, including recyclability, labelling, reuse, and minimisation requirements.
What qualifies as packaging under PPWR?
Some items that look incidental or secondary still count as packaging under the PPWR. An item is legally considered packaging if it serves to contain, protect, handle, deliver, or present a product, however small or seemingly insignificant it is.
For example, sticky labels attached directly to fruit or vegetables are packaging because they present and identify the product. Similarly, collation films, shrink wraps, and overwraps used to group products for sale or transport are treated as packaging because they facilitate handling and distribution.
Other items that often cause confusion are also explicitly classified as packaging. Clothes hangers sold together with garments are packaging, because they present and support the product in a sales context. CD or DVD spindles sold with discs are packaging because their primary purpose is to group and protect the discs during sale and transport. Cake doilies sold with a cake, or paper baking cases filled with pastries, are also considered packaging, because they are intended to be used as part of the product's presentation to the consumer. Even plastic sleeves for cleaned laundry, labels hung on products, and aluminium foil used to wrap food qualify as packaging when they perform a protective or presentational function.
Defining these borderline cases tells businesses which products trigger packaging obligations and which are exempt, which reduces the risk of misclassification and supports consistent enforcement across Member States.
What does not qualify as packaging under PPWR?
The PPWR also clarifies which items do not qualify as packaging, resolving ambiguities that existed under the previous directive. Items that are sold empty as products in their own right are not considered packaging.
Tool boxes, printer cartridges, sausage casing skins, and clothes hangers sold separately are all treated as products rather than packaging. The same applies to empty CD spindles intended for storage, mechanical querns integrated in refillable recipients such as refillable pepper mills, plant pots and seed trays used in production or sold together with the plant, wrapping paper sold separately, and paper baking cases or cake doilies sold without a cake. Annex B at the end of this guide lists the items that do not constitute packaging.
The regulation also exempts items that are integral to a product's lifetime and are used, consumed, or disposed of together with that product. A familiar example is the wax layer around cheese or a sausage casing, which is part of the product rather than a separate packaging component. Plant pots and seed trays are treated the same way when they are used in business-to-business relations through the stages of production, or are intended to be sold with the plant.
Only items that perform a packaging function for a product are regulated under the PPWR. Everything else, such as an empty toolbox or a refillable pepper mill, remains a product in its own right and sits outside the scope of packaging obligations. The explicit examples give businesses legal certainty and keep classification and enforcement consistent across all EU Member States.
What are the main rules of the EU Packaging and Packaging Waste Regulation (PPWR) that businesses need to know?
The PPWR's binding rules fall into five pillars: recyclability standards, reuse and minimisation, restrictions on harmful substances, labelling requirements, and conformity and documentation. They phase in under the timeline above and run to 2038.
Recyclability standards
At the centre of the PPWR is its recyclability framework. Every piece of packaging will be assessed and assigned a recyclability performance grade based on three key factors: design-for-recycling characteristics, compatibility with collection and sorting systems, and actual recycling performance.
From January 2030, only grades A, B, and C may be marketed in the EU, and lower-performing packaging is banned. The threshold tightens in January 2038, when only grades A and B remain permissible and grade C is phased out.
The regulation goes beyond theoretical recyclability. By 2035, packaging must be "recyclable in practice and at scale", meaning it must be collected, sorted, and processed through existing industrial recycling infrastructure across the EU, not just recyclable in laboratory or pilot conditions. Packaging that is technically recyclable but lacks widespread collection and sorting, for example certain multilayer plastics or black PET trays that optical sorters cannot detect, will not qualify as recyclable at scale.
Demonstrating recyclability at scale will require audited data from Member State collection systems, EPR schemes, or industrial recycling facilities to prove that the material enters a functioning recycling loop. The effect is that packaging which cannot realistically be recycled into usable secondary materials will be phased out of the EU market.
The PPWR also sets mandatory recycled content thresholds for plastic packaging from 2030. Minimum percentages of post-consumer recycled content must be achieved, calculated as an annual average per manufacturing plant and per packaging type. A narrow set of contact-sensitive applications is exempt on safety grounds; the contact-sensitive categories in the table below are not among them.
| Plastic packaging category | 2030 target* | 2040 target |
|---|---|---|
| Contact-sensitive PET packaging, excluding single-use beverage bottles | 30% | 50% |
| Other contact-sensitive plastic packaging, excluding single-use beverage bottles | 10% | 25% |
| Single-use plastic beverage bottles | 30% | 65% |
| Other plastic packaging | 35% | 65% |
*The first targets apply from 1 January 2030, or three years after the Article 7(8) implementing act enters into force, whichever is later. The percentages concern post-consumer recycled plastic and are calculated by packaging type and format, as an annual average per manufacturing plant, rather than as a company-wide average. [Art. 7(1)-(2)]
To accommodate chemical recycling, the regulation provides for mass balance accounting, which lets companies claim recycled content on the basis of input and output allocation even when the recycled molecules are chemically indistinguishable from virgin feedstock. The detailed calculation and verification methodology is to be set by implementing act under Article 7(8). Extended Producer Responsibility (EPR) fees will also be modulated according to recycled content levels, rewarding higher use of circular materials.
Reuse and minimisation
Reuse and minimisation are equally critical. Packaging must be designed for reuse whenever feasible, capable of a minimum number of rotations within a formal reuse system that includes collection, cleaning, and redistribution. Sector-specific reuse targets will gradually apply to take-away food and beverage packaging, retail transport packaging, and large-scale logistics.
To tackle over-packaging, from 2030 the regulation bans false bottoms, double walls, excessive void space, and purely decorative bulk, favouring fit-for-purpose design that uses only the material necessary to protect and present the product.
Restrictions on harmful substances and chemicals
On chemical safety, the PPWR aligns with the EU's REACH, CLP, and Chemicals Strategy for Sustainability, imposing restrictions on lead, cadmium, mercury, and hexavalent chromium, as well as PFAS in food-contact applications and a pending phase-out of bisphenol A (BPA) in plastics. These limits apply to both virgin and recycled materials, preventing toxic substances from recirculating in the economy.
Labelling requirements
To support consumer understanding and waste system efficiency, the PPWR introduces harmonised EU-wide labelling. By 2028-2029, all packaging must bear pictogram-based labels showing the material type and disposal method, aligned with matching symbols on waste bins.
Many packages will also include QR codes or digital markers providing material composition, recyclability, reusability, and return or collection instructions. Reusable packaging must clearly indicate its reusability and how to return it, supporting the growth of take-back and refill systems.
Conformity & documentation
The regulation also requires rigorous conformity assessment and documentation. Manufacturers and importers must verify that packaging and all its components, including lids, liners, and labels, comply with the PPWR. They must maintain technical files and Declarations of Conformity for 5 to 10 years, and ensure traceability through batch numbers, barcodes, or QR codes. This documentation lets market surveillance authorities verify compliance efficiently and take action where necessary.
How mass balance accounting enables recycled plastic compliance with PPWR
The PPWR sets mandatory minimum recycled content targets for specific categories of plastic packaging. For mechanically recycled plastic, the accounting is straightforward, because the material stays physically traceable and recycled content can be measured directly. But mechanical recycling can suffer from limitations in material quality, especially when contamination is present, and certain packaging applications, particularly those requiring high purity like food contact materials, are difficult to meet with mechanically recycled inputs alone.
Chemical recycling offers an alternative pathway, breaking plastic waste down into monomers or chemical feedstocks that can then be processed alongside virgin fossil feedstocks. The resulting plastic is chemically identical to virgin resin, making it suitable for high-performance applications, including food-grade packaging.
That identity is also the problem. Because the output molecules are chemically identical to virgin plastic, they cannot be physically segregated or traced through the supply chain, which makes traditional auditing impossible. For food-grade and medical packaging in particular, proving recycled content from advanced chemical recycling becomes a barrier to demonstrating compliance with the PPWR's recycled content mandates.
Mass balance accounting is how the regulation resolves this. It is a chain-of-custody method for tracking the proportion of recycled feedstock in a shared production system and allocating it to specific outputs for regulatory claims. It is already established practice for mass balance in plastics and chemicals, and the calculation and verification rules specific to the PPWR are to be set by implementing act under Article 7(8).
What is mass balance?
Mass balance is a chain-of-custody method that tracks and certifies the proportion of recycled and virgin inputs in a shared production system. Instead of tracing individual molecules, it allows allocation of recycled content to specific outputs based on audited accounting rules.
For example, if a polymer plant processes 20% chemically recycled feedstock and 80% virgin feedstock, the output production can allocate 20% of its packaging units as containing recycled content, even if the recycled and virgin molecules are indistinguishable. This approach allows producers to claim regulatory compliance for recycled content without physically segregating every stream.
Why mass balance is the ultimate tool for PPWR compliance
1. It enables recycled content claims from chemical recycling.
The PPWR's Article 7 establishes that recycled content thresholds apply even to chemically recycled plastics, as long as the recycled material is traceable, documented, and verifiable. Mass balance accounting allows companies to:
- Track the use of chemically recycled feedstock,
- Allocate that content to specific packaging units, and
- Report recycled content in a way that meets PPWR requirements.
Without mass balance, chemically recycled plastic would be nearly impossible to credit toward compliance because the output is chemically identical to virgin polymer.
2. It expands supply chain flexibility.
Mechanical recycling has limits. It struggles with contaminated, coloured, or multilayer plastics. Chemical recycling can process these hard-to-recycle materials, but the output blends into shared production systems. Mass balance accounting makes it practically feasible to integrate these recycled streams into regulated packaging, without needing to segregate physical flows across large production facilities. This removes bottlenecks for industries trying to meet PPWR thresholds.
3. It supports market scalability and circular economy goals.
Mass balance accounting enables blended production while maintaining regulatory credibility. It allows industry to scale up the use of recycled content faster, even when segregated infrastructure is unavailable, supporting the PPWR's overarching goal that all packaging be reusable or recyclable by 2030 and contain increasing shares of recycled content.
What makes mass balance credible and compliant?
For mass balance to be accepted by regulators and align with PPWR compliance, several conditions must be met:
- Chain-of-custody certification: Systems must be auditable and verified by third parties, such as ISCC PLUS or RecyClass, to ensure the recycled input claims are genuine.
- Transparency and documentation: Companies must maintain clear input-output balances and allocation rules, aligned with PPWR Articles 15 to 19 on conformity and documentation.
- No double-counting: Recycled content can only be claimed once; allocated credits cannot be reused.
- Substantiated claims: Any claim of recycled content must be traceable and verifiable, consistent with Article 7(6).
- Mass balance attribution method: The accounting method, whether batch allocation or credit transfer, must be harmonised and approved by the European Commission through implementing acts.
Meeting these conditions gives businesses a credible and scalable route to the PPWR's recycled content mandates without physically segregating every stream.
Conclusion
The PPWR sets harmonised, binding requirements on recyclability, reuse, recycled content, chemical safety, and labelling. Together they give businesses an enforceable schedule for phasing out wasteful, non-recyclable packaging and adopting circular design principles. Because the regulation applies directly in every Member State, the same requirements apply to every company selling into the EU.
The PPWR is one part of a wider problem. Plastic waste streams are complex enough that regulatory coherence alone will not resolve them; they also need material innovation, economic incentives, and advanced digital traceability systems.
Traceability tools that support mass balancing are what verify recycled content claims under the PPWR and keep those claims defensible. Meeting the targets takes a phased plan that connects what companies do now to the packaging changes they will need by 2030.
Short term (2025-2026)
- Audit packaging portfolio to assess recyclability and minimisation.
- Begin tracking material inputs and preparing for recycled content documentation.
- Identify non-compliant packaging and plan phase-outs or redesign.
Mid term (2026-2030)
- Implement design-for-recycling improvements.
- Prepare packaging for recyclability grading and conformity assessments.
- Invest in infrastructure for reusable systems or join compliant reuse networks.
Long term (2030+)
- Meet or exceed recycled content targets for plastic.
- Provide documented evidence of packaging being recycled at scale.
- Collaborate with recyclers and PROs to ensure alignment with real-world performance.
Start with the packaging audit. It produces the data that every later phase depends on. The PPWR is also one part of a wider shift in global plastics regulations.
Struggling to track recycled content for the PPWR? We make mass balance accounting straightforward, with automated calculations, audit-ready documentation, and the evidence you need to keep your products on the EU market.