European Packaging & Packaging Waste Regulation (PPWR) Enters into Force in August: What Impact on the Digital Economy?

The Packaging & Packaging Waste Regulation (PPWR) entered into force in February 2025 and will generally apply starting on August 12, 2026. As a regulation, it replaces the Packaging and Packaging Waste Directive, transforming national versions of laws governing recyclability and reuse of primary, secondary, and tertiary packaging into European Union (EU)-wide law. Of particular interest for the growth of the Internet of Things (IoT) is what PPWR requires for tertiary packaging, with specific measures governing the use of transport packaging, such as pallets, crates, Intermediate Bulk Containers (IBCs), and others. Specifically, PPWR requires the following:

• Transport packaging is reusable within a reuse system, with a 40% reusability target by January 1, 2030 and a 70% target by January 1, 2040.
• Flows of transport packaging in the EU within an enterprise’s own operations, or between an enterprise and any other “linked or partner enterprise,” should be 100% reusable by 2030; and flows between different enterprises within a single country should be 100% reusable by the same date.
• Economic operators should limit empty space on transport packaging to 50% by 2030.
• Reuse targets should be met and documented at an audit level, with legal responsibility for reporting on enterprises using transport packaging.
• Reusable packaging should bear a “QR code or other standardised, open, digital data carrier.” This is voluntary for open loop systems without a single operator; but mandatory for closed and semi-closed loops.
• The data carrier should provide information not only on the material credentials of the packaging, but also information that facilitates the tracking of both trips and rotations/cycle times of reusable transport packaging.

Several parts of the regulation remain to be defined, such as how percentages are calculated; for instance, empty space by transport asset type will only be defined by February 2028. August 12, 2026 marks the beginning of the operational phase of the regulation, rather than a specific compliance deadline; however, enterprises by this date must have a declaration of conformity for packaging and technical documentation about the packaging in line with stated requirements.

Returnable Transport Asset (RTA) poolers correctly note that PPWR is a significant opportunity for them, in that they already have reusable systems in place. Many enterprises operate proprietary open pools with single-use RTAs, or may operate closed-loop RTA operations. But maintaining material and conformity information, as well as data on reuse, is a challenge on a different scale. Switching to an RTA pooling model will often be the most practical way for enterprises to achieve reuse targets without having to build their own internal reverse logistics networks.

More broadly, however, PPWR is a data management challenge. Enterprises are legally responsible for collecting and reporting information on their transport packaging, not only through a declaration process, but through detailed documentation. This is significant as enterprises have traditionally seen supply chains as a cost, rather than as a strategic differentiator, and have underinvested in Information Technology (IT) systems to help manage RTA flows. In many cases, enterprises are requesting digital readiness from their RTA manufacturers and their poolers, but enterprise-side IT capabilities remain limited, so that readiness does not often translate into investment or visibility.

PPWR changes this by requiring information amounting to a digital pallet passport regarding an RTA’s material origin, as well as information about how an RTA has moved through the supply chain. This requires enterprises to think more carefully about their IT systems, and the way they gather and exchange data within the enterprise and between suppliers. RTA poolers have been investing more significantly in these data exchange capabilities to facilitate RTA dispatch automation, auditing, and billing documentation for a “paperless supply chain”—another area where poolers aim to present themselves as a PPWR-ready alternative for enterprises—but enterprises will need to do more than rely purely on external suppliers’ data to comply.

The initial focus for enterprises will be on compliance at a basic level. This is a similar story to Digital Product Passport (DPP) implementation, with enterprises responding reactively to an incoming regulation to understand how they can be ready to meet compliance. However, the longer-term opportunity is for value-added traceability and visibility use cases to provide better understanding on flows within an enterprise’s supply chain—in the same way that the DPP has started to focus increasingly on customer interaction, supplier traceability, brand protection, and other value-added use cases.

Additionally, while PPWR requires QR code compliance (or other digital data carrier), enterprises will quickly find that manual scanning of transport packaging, or setting up automation infrastructure to capture data carriers as they move onto and from their sites, is a significant burden. From an initial starting point of regulatory compliance, enterprises will start thinking about how to automate data collection in a more efficient way. This is part of the messaging from poolers such as IFCO, offering digital services both through IFCO Digital and its external-customer facing technology, TRLLN, launched in June 2026: compliance through active IoT technologies can reduce the burden of documentation gathering and reporting.

PPWR will not result in a short-term push toward IoT digitization: the cost constraints of active IoT remain significant, both for enterprises and poolers. But it will sharpen enterprises’ focus on their IT systems for gathering data about a part of their operations they have typically overlooked. The requirement to understand cycle flows and empty space creates a foundational data layer for enterprises to benchmark, analyze, and optimize the operation of their supply chains; not only around RTA flows themselves, but also around related areas, such as transport lane optimization. The PPWR data reporting requirement will create a longer-term foundation for enterprises to assess where they can use visibility technologies to further enhance their operations—whether these technologies are procured internally, or through a third party like an RTA pooler.

Technology suppliers should frame PPWR as a data management trigger. The pain point that enterprises will feel from PPWR in the short term is not supply chain optimization, and for companies not used to considering supply chains a strategic asset, optimization is too significant a leap for them to pursue in the short term; therefore, compliance readiness is the first stopping point on their journey. Suppliers should message according to different time horizons within PPWR’s scope: short-term compliance readiness, operational evidence by 2030, and automation and optimization beyond 2030. This creates a clear pathway to help enterprises prepare to better use data-based insights in their supply chains, without overwhelming them with additional complexity.