The PPWR should fit a system that already works, not the other way around
The EU Packaging and Packaging Waste Regulation (PPWR) will apply from 12 August 2026. Its central ambition, to accelerate the circular economy and reduce waste is one the wooden pallet sector has no quarrel with. The friction lies elsewhere. Much of the regulation was conceived with short-lived consumer packaging in view to target plastics. But when blanket rules are applied to wooden pallets, they meet a market that has been circular for as long as anyone can remember, long before circularity became a regulatory objective.
Wooden pallets are among the most efficient circular systems Europe has. They last for years, very few are lost, and repair and reuse are simply how the trade operates. Three broad models coexist. In closed-loop pooling, a pooling company owns the pallet and manages its whole life. In standardised open-pool exchange, usually built around EPAL pallets, ownership passes with each exchange. And in the market-driven open-loop system, which accounts for the largest part of the market, unbranded white wood pallets pass through a vast secondary network of independent operators who recover, sort, repair, and resell them. It is this last model where the PPWR’s underlying assumptions start to come apart.
Take Extended Producer Responsibility (EPR) and the way the regulation defines a ‘producer’. The PPWR draws a line between the manufacturer, who proves conformity and handles labelling, and the producer, who carries the costs of collection and recovery. That division makes sense for branded packaging with a traceable owner. It makes far less sense for an unbranded pallet that changes hands repeatedly across its life. Asking the actor who first placed it on the market to remain financially responsible for its recovery, long after it has left their control and entered a network they have no visibility over, is to ask for responsibility without any corresponding ability to act. A workable framework would have to recognise that, in an open-loop system, EPR cannot reasonably rest on a manufacturer who no longer controls the pallet after it enters the market.
The reuse targets for transport packaging raise a similar problem: 40% reusable by 2030 and 70% by 2040, together with the conditions for counting something as ‘reusable’, assume a system in which individual rotations can be tracked and counted. That assumption works for pooled or operator-run systems. It does not hold for a decentralised open-loop market, where no single operator can follow one pallet through thousands of independent hands to count how often it is reused. The pallets are unquestionably reused, again and again; what is missing is the unit-level paper trail the rules expect. The sensible answer is the one the market itself points to: allow average estimation for decentralised systems rather than demanding individual rotation tracking that no operator is positioned to provide.
Labelling and recyclability close the picture. From 2030, pallets must be designed to be recyclable, a bar that wood easily clears. This is precisely why it already carries lower recycling targets that reflect its maturity as a material. Labelling obligations apply from 2029, and Europallets have already secured an exemption that requires only the EPAL logo. The logic behind that carve-out is sound, but it stops short. In an open-loop system there is no system operator to attach a label or stand behind it, so extending the same exemption to unbranded white wood pallets would simply apply a principle the regulation has already accepted to the part of the market it currently overlooks.
None of this is an argument against the regulation. It is an argument that the regulation should match how the market actually works, and there are real signs it is moving that way. The Commission’s March 2026 implementation guidelines acknowledge that wooden pallets in active use fall outside the reuse obligations and accept average estimation in place of individual tracking for decentralised systems. There is precedent for this kind of tailoring, too. In February 2026 the Commission adopted its first delegated act under the PPWR, exempting pallet wrapping and straps from the full reuse requirement after finding that strict compliance would impose disproportionate costs. The principle at work there, that reuse obligations should bend where they do not fit operational reality, is exactly the one the open-loop pallet market depends on. The remaining weakness is durability: guidance, by the Commission’s own account, neither amends nor replaces the regulation and can be revised at any time, and a sector cannot anchor long-term investment in an interpretation with no firm legal footing.
That is why the work is not finished, and why it is worth doing together. The wooden pallet sector wants a circular economy to succeed; it has, in effect, been running one for decades. What it needs now is a regulatory framework that recognises that achievement rather than measuring it against a model built for something else. Getting there will take continued dialogue between producers, the wider industry, and policymakers, turning the encouraging signals of 2026 into lasting legal certainty. We intend to keep working with the whole sector to shape rules that protect a system already delivering what the PPWR set out to achieve.
