Preparing for the EU's Digital Product Passport Regulation: A Guide

The European Union has taken a significant step towards promoting sustainability and ethical practices in product design and manufacturing with the formal adoption of the Ecodesign for Sustainable Products Regulation (ESPR). This regulation empowers the European Commission to set sustainable and ethical design and reporting requirements for products sold on the European market, including textiles and apparel items.

One of the key requirements of the ESPR is the Digital Product Passport (DPP), an innovative solution designed to improve transparency and sustainability. The DPP will provide easy links to an online database of information, including materials tracing and manufacturing details. The content structure of an EU Digital Product Passport typically includes details on the product's origin, material composition, recyclability, repairability, and environmental impact data, all designed to support circular economy goals and compliance with EU regulations like the Ecodesign Directive and the Packaging and Packaging Waste Regulation.

Marimekko, a Finnish textile company, is currently involved in a DPP pilot project and has found that data collection for DPPs can be resource-intensive and difficult. However, retail companies like Kappahl see a big opportunity for customers to make better purchasing decisions using DPPs for more streamlined sustainability communication.

Businesses will have 18 months following the adoption of the ESPR to comply with DPP requirements. During this period, they will be responsible for maintaining their own online repository of DPP information and making it available to consumers and other parties.

The costs of implementing DPPs for small to medium enterprises are highly variable and depend on a number of factors, according to a study funded by the European Commission in 2024. Pricing for DPP creation is variable and depends on the uniqueness of each business, with companies like Protokol stating that prices could range from free for up to 50 SKUs to per-DPP prices starting at 3,000 Euros, or about $3,280 at current exchange rates.

Integrating the data into a DPP might cost around $100 per hour, according to BlueCromos, but this assumes the data is already collected and available. To implement DPPs successfully, data collection will need to be baked into supply chains, and technology can help solve some of the problems associated with manual data entry.

The European Commission might require DPP service providers to obtain certification, but the criteria for such certification are not yet clear. Having comprehensive supply chain data and a dynamic network view allows brands to proactively manage their supply chains to anticipate risks and prevent business disruptions. Anja Sadock, head of marketing at TrusTrace, believes that the fine-grained tracking of product data required by DPPs will help brands optimize inventory, protect themselves from counterfeiting, and run better supply chains.

The Digital Product Passport is more than just a QR code; it involves an information carrier (such as a QR code, RFID tag, NFC tag, or watermark) that gives customers and other users access to the data. Iimpcoll, another European data management company, mentioned that helping a company create a roadmap for implementing DPP could take three to six working weeks, but declined to state specific prices.

Failure to comply with DPP requirements may result in penalties, including fines and time-limited exclusion from public procurement procedures. The details of what will be required in each DPP will be established by the European Commission by December 31, 2025.

In conclusion, the adoption of the ESPR and the implementation of DPPs mark a significant step towards promoting sustainability and ethical practices in product design and manufacturing within the European Union. As businesses adapt to these new requirements, they will not only improve transparency and sustainability but also create opportunities for better decision-making and more efficient supply chains.