In the last few months, the New Legislative Framework (NLF), which constitutes the basis of all EU product legislation, has come back to the discussion table of the EU institutions. This one piece of the wide puzzle of product rules might be less known than the General Product Safety Regulation. Yet, it is, to some extent, its blueprint, both in terms of structure (obligations’ distribution, product rules) and general objectives. The NLF provides references for rules covering many product categories – spanning from cosmetics, detergents to toys, from drones to fireworks.
The European Parliament, and more specifically the EP IMCO Committee, has recently launched an Own-Initiative (INI) procedure aimed at shaping the EP’s position on the likely revision of the NLF. Moreover, the European Commission has recently informed stakeholders of its intention to explore how to align the NLF and generally product legislation with the digital era.
What is the NLF about?
The NLF consists of two texts – that is, Decision No 768/2008/EC and Regulation (EC) No 765/2008. The former is a non-legislative text enshrining the so-called “references provisions” (including definitions such as ‘place on the market’, ‘economic operator’, their related obligations, and general rules on the conformity of products etc.). The reference provisions are key for both policymakers – who can copy-paste these in any piece of legislation regulating the sales of products, as well as for companies and stakeholders in general, who can familiarise themselves with this set of rules. This is key for businesses to achieve effective and efficient compliance.
Besides ensuring regulatory coherence and easier business compliance, the NLF Regulation establishes the requirements for the CE marking and the framework for EU conformity assessment procedures. While this wording concerns more public authorities than companies, it does have an indirect effect on businesses’ procedures to market a product (e.g., how many steps are to be followed for a product to bear the right information).
In 2022, the European Commission conducted an evaluation of the NLF, which found, inter alia, that the framework needs to be updated to address the objective of the circular economy and growing digitalisation. Among the likely tweaks, the introduction of additional definitions, such as ‘refurbishment’, ‘remanufacturing’, in the scope of the NLF is put forward. Moreover, new definitions resulting from market trends and emerging Union legislative proposals could be added to the NLF.
Discussion in the EP IMCO Committee likely to focus on role of online marketplaces in ensuring product compliance
As it emerged from the first exchange of views on the INI Initiative “A new legislative framework for products that is fit for the digital and sustainable transition”, Rapporteur David Cormand (Greens/EFA, France) has highlighted the need for integrating the principles of circularity, durability, and transparency in the revised NLF. To this end, he notably supported the implementation of the Digital Product Passport (DPP) as a tool for material traceability and called for increased environmental transparency obligations on economic operators. In particular, Cormand suggested a clarification of the legal responsibility of online platforms and proposed introducing additional obligations for economic operators and platforms related to their compliance history.
Talks in the Commission expected to address the potential of digitalisation to simplify product compliance
The Commission has instead chosen to focus on another angle of the NLF – the digitalisation of the procedures and documentation to demonstrate that products comply with the applicable requirements. Documents that have to be provided notably include declaration of conformity and instruction manuals, which the Commission is now considering digitalising. The shift to a digital format for these and other documentation is to be placed in the context of the DPP, whose development – notably as a tool for making accessible information related to compliance – is currently ongoing. In this procedure, the Commission will also assess the possible alternatives to harmonised standards to demonstrate product conformity. Moreover, in the following months, the Commission is expected to reopen other aspects of the NLF, namely, to make it “circular economy-proof”. However, this procedure is still pending political greenlight. Currently, it is still unclear whether and how the proposal for digitalising product conformity documents and procedures, and the wider NLF revision will overlap.
What is in for the future?
The EP INI Report is expected to be delivered by September, with the first draft of the Report likely to be presented in the second half of April and discussions in the IMCO Committee at the end of the month. The timeline for the simplification proposal of the Commission is still unknown. All in all, both discussions will be key in shaping the future of EU product policy. Stakeholders’ participation in the talks is fundamental to make sure that the interests of e-retailers and online marketplaces are taken into account. In fact, while the rules placing a product on the market particularly concern manufacturers, the increasing digitalisation of product information and stronger traceability requirements are placing more obligations on economic operators and intermediaries. Finally, the discussions around the NLF could be the right framework to tackle some of the challenges currently experienced by e-commerce players (e.g., the lack of level playing field with certain players).