Aided by the Circular Economy Action Plan, which was presented by the Commission on 11 March 2020, the intention is to decouple economic growth and the use of resources. In doing so, the economy shall be made more resource efficient and contribute to the target of climate neutrality by 2050. The Action Plan shall be followed by measures for improved recycling, for the re-use of raw materials, for making repairs easier and a better Information basis for consumers. The AK supports the broad approach of the Commission’s Action Plan but sees a need for improvement in some areas.

Ensuring consumer interests

The Chamber of Labour welcomes the intention to strengthen the Right to Repair announced in the Circular Economy Action Plan. There is a need to create financial incentives in form of an EU-wide regulation to make repairs more attractive compared to new purchases. This requires standardisation and norming certain product parts. Legal requirements must encourage manufacturers and traders to take their first steps towards a made-to-last product range. Changed framework conditions are the requirement for consumers being able to take environmentally conscious decisions. At present, the market offer for consumers is unclear and difficult to understand. Legal certainty for consumers has to be guaranteed and the warranty law needs to be adjusted by extending the warranty period and the reversal of the burden of proof to 2 years. Unfortunately, the Action Plan does not mention any participation of consumer associations in product related initiatives. However, consumer information independent of manufacturer interests is needed. The AK observes too little attention being paid by the Commission. In general, the adherence of regulations shall be ensured by hugely extending market supervision. Required is an independent control body to ensure consumer interests.

Circular economy and trade policy

A third of the European CO2 footprint is generated outside the EU. The announcement of EU Commissioner for Justice, Didier Reynders to present an EU Supply Chain Law in early 2021 is to be welcomed. A realignment of the trade policy, which focuses on people and the environment instead of the profit interests of multinational corporations, would be desirable. Trade policy must not be contradictory to the circular economy and should not undermine the efforts of the Green Deal. Sustainability chapters in trade agreements have to be furnished with an enforcement mechanism. However, they are currently ineffective as they have been explicitly excluded from general dispute settlement proceedings. The ratification and the implementation of the Paris climate targets must be enshrined in all agreements. In addition, the controversial Investor State Dispute Settlement (ISDS) have to be cancelled. Furthermore, a complete impact analysis and effectiveness analysis regarding any further opening of the market must be a requirement for starting the negotiations on trade facilitation. This must also include a review of the trade agreement's impact on the environment and climate.

Social Dialogue

In contrast to the 2015 plan for the circular economy, the new Action Plan does not mention the Social dialogue. This is regrettable because the systematic integration of the social partners at all stages – among other in the development of policy proposals – is a key issue. In order not to “leave no one behind”, a social dialogue at eye level is needed. The references to promoting the social economy – which are welcomed by the AK – cannot replace the participation of the representation of employee representatives and the Social Dialogue.

Further information:

AK EUROPA: Commission proposes resource efficient economy

AK EUROPA: Trade agreements, human rights and the fight against a separate system of courts for corporations

AK: New Action Plan circular economy: for a clean and more competitive Europe