ESPR Penalties and Enforcement — What Non-Compliance Costs

The ESPR Enforcement Framework

ESPR enforcement operates at two levels: national market surveillance authorities (MSAs) enforce ESPR requirements within each EU Member State, and the European Commission coordinates enforcement activities across the EU through the ESPR Enforcement Forum. The enforcement framework is established in Chapter VII of ESPR (Articles 56–70) and draws on the broader EU market surveillance framework established by Regulation (EU) 2019/1020 on market surveillance and compliance of products.

Market surveillance authorities have extensive powers under ESPR. They can request technical documentation from manufacturers, importers, and distributors. They can take product samples for testing. They can conduct inspections of manufacturing facilities, warehouses, and retail premises. They can access DPP data through the market surveillance authority access portal. They can order corrective actions, including product modification, product withdrawal from the market, and product recall from consumers. And they can impose financial penalties on economic operators who fail to comply with ESPR requirements.

Types of ESPR Penalties

ESPR Article 68 requires Member States to lay down rules on penalties applicable to infringements of ESPR and to take all measures necessary to ensure that they are implemented. The penalties must be effective, proportionate, and dissuasive. While the specific penalty amounts are set by each Member State, ESPR provides guidance on the factors that penalties must take into account: the nature, gravity, and duration of the infringement; the economic benefit gained from the infringement; any previous infringements by the same economic operator; the degree of cooperation with the competent authorities; and whether the infringement was intentional or negligent.

In practice, ESPR penalties are expected to take several forms. Financial penalties (fines) are the primary enforcement tool. For serious infringements — such as placing products on the market without a required DPP, falsifying DPP data, or systematically failing to meet ecodesign performance requirements — fines are expected to be significant, potentially running to hundreds of thousands or millions of euros for large economic operators. Product withdrawal orders require the economic operator to remove non-compliant products from the EU market. Product recall orders require the economic operator to retrieve non-compliant products from consumers. Market bans prohibit the economic operator from placing specific products on the EU market for a defined period.

Customs Enforcement

ESPR strengthens customs controls at EU external borders. Article 41 of ESPR requires customs authorities to check that products subject to DPP requirements are accompanied by a valid DPP before allowing entry into the EU market. Customs authorities can suspend the release of products that appear to be non-compliant and refer them to the relevant market surveillance authority for further investigation. Products that are found to be non-compliant can be refused entry into the EU market and returned to the exporter.

For non-EU manufacturers, customs enforcement is the most immediate and practical enforcement risk. A product that arrives at a EU port without a valid DPP (once required for its category) will be held at customs, and the importer will face the choice of either bringing the product into compliance (which may require returning it to the manufacturer) or abandoning the shipment. The cost of a customs hold — including storage fees, demurrage charges, and the cost of returning the shipment — can be substantial.

Market Surveillance Priorities

Market surveillance authorities will not be able to check every product on the EU market — they must prioritise their enforcement activities. ESPR requires the Commission to coordinate market surveillance priorities through the ESPR Enforcement Forum and to publish annual reports on enforcement activities. Based on the experience of enforcement under the Ecodesign Directive, market surveillance authorities are expected to prioritise: product categories with the highest environmental impact; product categories where non-compliance is most prevalent; products from economic operators with a history of non-compliance; and products identified through consumer complaints or industry tip-offs.

The DPP provides a powerful new enforcement tool for market surveillance authorities. Because the DPP is machine-readable and accessible via a QR code, market surveillance authorities can rapidly check DPP data for any product they encounter in the market — without needing to request technical documentation from the manufacturer. This significantly lowers the cost of market surveillance and is expected to result in more frequent and more targeted enforcement actions than was possible under the Ecodesign Directive.

The Cost of Non-Compliance vs. the Cost of Compliance

The cost of ESPR non-compliance significantly exceeds the cost of compliance for most economic operators. The direct costs of non-compliance include financial penalties, product withdrawal and recall costs, legal costs, and the cost of lost EU market access. The indirect costs include reputational damage, loss of customer trust, and the competitive disadvantage of being excluded from the EU market while compliant competitors continue to sell. For exporters dependent on EU market access, the indirect costs of non-compliance can be existential.

The cost of compliance, by contrast, is primarily the upfront investment in data infrastructure, DPP registry implementation, technical documentation, and conformity assessment. For most manufacturers, this investment is recoverable within two to three years through the market access it enables. Manufacturers who invest in ESPR compliance early will also gain a competitive advantage over competitors who delay — they will be able to demonstrate compliance to EU importers and buyers before the compliance deadline, which can support premium pricing and preferred supplier status.