To hasten the EU’s shift from a linear to a circular economy, the EU aims to double the circularity rate by 2030 with the new Circular Economy Act, which is scheduled for adoption in 2026. The EU aims to double the circularity rate by 2030 from 11.8% in 2023 to 24%. This ambitious law seeks to improve decarbonization, resilience, competitiveness, and economic security. The Act positions the EU as a global leader in circular economy principles and is consistent with the Clean Industrial Deal and Competitiveness Compass. The Act aims to change how businesses handle waste and resources by solving resource usage inefficiencies and establishing a single market for secondary raw materials, which will support sustainable growth in the area.

Why Is the Circular Economy Act Critical for the EU’s Future?

Measuring the proportion of recycled resources in the economy, the EU’s circularity rate has stagnated, increasing only from 10.7% in 2010 to 11.8% in 2023. Inadequate market demand for recycled materials, disjointed laws, and structural inefficiencies are the causes of this sluggish growth. By creating a single market for secondary raw materials, improving the quantity and caliber of recycled inputs, and boosting demand across industries, the Circular Economy Act is essential to removing these obstacles.

This change is necessary to promote decarbonization objectives, improve economic resilience, and lessen dependency on imported raw resources. In line with more comprehensive plans like the Clean Industrial Deal, the Act seeks to position the EU as a global leader in circular economy practices by 2030.

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What Are the Core Pillars of the Circular Economy Act?

The EU aims to double the circularity rate by 2030 and to promote circularity, the Act is based on two key pillars. The first goal is to improve collection, recycling, and demand for secondary raw elements, such as cobalt and lithium, which are necessary for clean technologies, with a focus on e-waste. Through the reform of “end-of-waste” criteria, the digitization of Extended Producer Responsibility (EPR) programs, and the establishment of mandated procurement requirements for circular goods and services, the second pillar seeks to establish a functional single market for waste and recycled materials.

By addressing supply-side and demand-side issues, these policies guarantee that recycled resources are smoothly incorporated into the economy. A coherent policy framework is ensured by the Act’s compliance with laws such as the Critical Raw Materials Act and the Ecodesign for Sustainable Products Regulation.

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How Will the Act Address E-Waste and Critical Raw Materials?

There are opportunities and challenges associated with e-waste, which includes abandoned devices that contain rare earth elements and other vital raw materials (CRMs). Since almost half of the EU’s e-waste goes uncollected, the Circular Economy Act would improve e-waste management by boosting recycling rates and strengthening collection methods. The Act aims to reduce reliance on high-impact extraction techniques by creating demand for secondary CRMs and promoting sustainable manufacturing for devices such as wind turbines and batteries.

By May 2026, digital technologies like the Digital Waste Shipment System (DIWASS) will replace paper-based procedures in cross-border recycling, increasing efficiency and traceability. These initiatives will support the EU industry’s access to high-quality recycled resources.

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What Role Does Public Consultation Play in Shaping the Act?

The Circular Economy Act will be shaped in large part by the public consultation and Call for Evidence, which is open until November 6, 2025. To identify opportunities and challenges for expanding circular practices, the European Commission is seeking feedback from companies, legislators, and citizens. This all-inclusive strategy guarantees that the Act tackles practical issues, including fragmented regulations and limited demand for recycled materials.

Through the Have Your Say portal, stakeholders can provide input that will affect the impact assessment and the final legislative proposal. The consultation ensures a strong framework for circularity by bringing the Act into line with important EU policies, such as the Steel and Metals Action Plan and the Single Market Strategy.

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Frequently Asked Questions (FAQs)

Q1. Who can participate in the Circular Economy Act consultation?

Through the Have Your Say portal, all interested parties—businesses, industry leaders, legislators, and the general public—are invited to provide input by November 6, 2025.

Q2. What is the single market for secondary raw materials?

It is a framework designed to facilitate the free flow of trash and recycled materials throughout the EU. By guaranteeing that industries use high-quality recycled inputs, it helps to lessen dependency on virgin resources.

Q3. In what ways does the Act complement existing EU projects?

To establish a unified framework for the circular economy, the Act combines with the Single Market Strategy, Steel and Metals Action Plan, Ecodesign for Sustainable Products Regulation, Packaging and Packaging Waste Regulation, and Critical Raw Materials Act.

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