With the European elections coming up on 6–9 June 2024, legislators have precious little time to wrap up as many loose ends as possible before the dissolution of the European Parliament in April and the beginning of the campaigning period.
What obligations lie ahead for the industry and when will these start to be applicable? Luca Bucchini (pictured), Chair of the European Specialist Sports Nutrition Alliance (ESSNA), explains everything you need to know.
Sustainability due diligence requirements
The EU is a step closer to introducing the Corporate Sustainability Due Diligence Directive (CS3D) as the provisional agreement on this file has now been approved by the Council.
The CS3D was proposed by the European Commission back in February 2023, following a call from the Parliament for mandatory due diligence legislation.
Complementing other existing and upcoming legislative acts, the CS3D essentially aims to govern firms’ impact on human rights and the environment.
What this means for sports foods manufacturers and brands is that they will have to monitor their value chains to ensure that they don’t cause any human rights and environmental violations.
Also, the scope of CS3D extends to businesses’ upstream and downstream partners, meaning that companies will have to prevent, end or mitigate negative effects caused by transport, supply, distribution and storage operations.
Businesses based outside the EU with operations in the Union should know that the CS3D includes a series of provisions that could impact them, such as, climate transition plans that companies will need to incorporate into their operational processes.
Organisations will also be required to assess the effectiveness of their due diligence measures on a yearly basis (at least) or following a significant change in business operations.
The Directive will apply in three categories depending on the company’s size. For example, operations with more than 500 employees and €150 million in turnover need to apply the CS3D 3 years after entry into force, with reporting for financial year starting 1 January 2028.
Moreover, businesses that are smaller than 1000 employees and generate less than €450 million in turnover will not be included in the Directive’s scope.
The Parliament is expected to vote to approve the provisional agreement on the CS3D this month, meaning it is likely that the file will be completed during the current EU mandate.
Food waste framework
Another issue on the sports and active nutrition sector’s radar is the fact that decision makers have been working to revise the EU’s rules on food waste.
The Parliament has adopted its position on the Commission’s proposal to amend the Waste Framework Directive, voting in favour of highly ambitious food waste targets of at least 20% in food processing and manufacturing — to be introduced by 2030.
Also, sports food businesses should know that parliamentarians are keen to ensure a fair distribution of the costs and benefits associated with food waste prevention measures.
In this context, they have introduced targeted amendments to the Directive to directly tackle inefficiencies in the food supply chain.
MEPs have called on the Commission to provide comprehensive guidelines pertaining to the methodology for food waste measurement, which will likely mean more data inputs from businesses.
In addition, the Parliament has suggested that manufacturers use clearer date labelling on their products. Companies should expect to see the publication of the new law only after the European Elections, as the EU institutions will be negotiating its final version once the new Parliament is formed.
EU deforestation regulation
Policy makers have also introduced new legislation to address the issue of deforestation — Regulation (EU) 2023/1115 — which was recently adopted by the Parliament and the Council.
This is highly relevant for manufacturers using raw materials such as cocoa, coffee, oil palm and soya as the new law sets out obligations regarding the placing on the market, marketing or export of these materials and products made from them.
In particular, the Regulation, asks businesses to ensure that these raw materials
- have not contributed to deforestation
- have been produced in accordance with the relevant legislation of the country of production
- are covered by a statement of due diligence.
To ensure compliance, operators will need to exercise due diligence on all relevant products provided by each supplier and meet specific requirements in relation to reporting, assessment as well as mitigation measures.
In case of violations, not only will relevant authorities be asking offenders to take corrective actions to put an end to the non-compliance within specific deadlines but, more importantly, the legislation foresees fines and sanctions.
Companies will have until 30 December 2024 to ensure they are compliant with legislation, except for micro and small undertakings, for which the Regulation will apply from 30 June 2025.
Ban on greenwashing practices
As sports food companies work to ensure that their operations reflect and actively contribute to the sustainability objectives set out by decision makers and their products meet the needs of environmentally conscious consumers, effective and transparent marketing and communication strategies showcasing businesses’ sustainability achievements are key. But what is the policy and regulatory state of play on this front?
On 26 March, the Directive on Empowering Consumers for the Green Transition (ECGTD) came into force having been published in the Official Journal of the EU (OJEU) 20 days prior.
This directive aims to tackle unfair commercial practices that mislead consumers away from sustainable consumption.
Among other things, it prohibits making a generic environmental claim for which the company is not able to demonstrate recognised excellent and relevant performance.
For instance, companies will no longer be permitted to use loose language, such as ecological, green or ecofriendly to convey their environmental credentials.
The ECGTD also prohibits claims that products have a neutral or positive environmental impact related to offsetting greenhouse gas emissions.
In addition, the Directive foresees stricter sustainability labelling, meaning that the use of generic images on packaging to emphasise a product’s environmental credentials — such as an image of a tree or a leaf — will require verification through a third-party certification scheme.
The Directive also expands requirements on precontractual information under the Consumer Rights Directive to include information on conformity guarantees, repairability and delivery options with environmental considerations. The application of these new rules is expected for the second half of 2026.
Meanwhile, discussions are still ongoing regarding a related but different proposal — the Green Claims Directive — which aims to complement the ECGTD by proposing more specific rules on environmental claims.
Particular foci are substantiation, communication and verification. Under the adopted text, businesses (including sports foods companies) are obliged to submit evidence about their environmental marketing claims before advertising products as biodegradable, less polluting, water saving or having biobased content.
Essentially, the Green Claims Directive will require rigorous assessments to substantiate environmental claims, necessitating a potential change in marketing strategies and labelling. In terms of timelines for its entry into force, we don’t expect to see its introduction before 2025.
New rules on packaging and packaging waste
Policy makers recently reached an agreement on the upcoming Packaging and Packaging Waste Regulation (PPWR), which will be setting out strict targets for the reduction, reuse and recycling of packaging and associated waste.
The PPWR will also be introducing new measures on the composition and design of packaging to mandate packaging minimisation, as well as new composition and labelling rules to aid recyclability.
All packaging on the EU market will have to be recyclable by 2030 and, from 1 January 2035, recyclable packaging will need to be recycled “at scale.” In addition, “forever chemicals” will also be banned in food contact packaging above certain thresholds by 2026.
Once formally approved by policy makers, the PPWR will be applicable from 18 months after the date of entry into force.
Under the expected timelines, businesses — including sports and active nutrition companies — would be required to abide by the PPRW rules by approximately 2026, so they may have to substitute their existing packaging for more sustainable and authorised materials under the regulation.
To summarise, there is a lot in the works for organisations to be aware of in terms of sustainability and ESG requirements.
The European Specialist Sports Nutrition Alliance (ESSNA) is at the forefront of these developments, providing its members with in-depth insights and analysis and working with policy makers to ensure that legislation is fit for purpose.