Implementing circular economy practices presents businesses with various obstacles, particularly concerning Critical Raw Materials (CRMs). Here, we delve into the challenges faced by businesses in this endeavor:

1. Regulatory Barriers:

• Existing Regulations: Current regulations may not always support circular economy practices, posing barriers to implementation.
• Waste Leakage: Businesses encounter significant challenges due to EU waste regulations, which sometimes facilitate the export of end-of-life products rather than promoting recycling within the EU. Until revised regulations come into effect, end-of-life products are often classified as waste, hindering their potential as valuable resources.

2. Lack of Policy Incentives:

• Shift in Material Preference: Businesses lack sufficient incentives to prioritize recycled materials over virgin ones. Clear policy signals are needed to encourage the use of recycled materials. Measures like mandating recycled content in products, green procurement policies, and financial incentives for recycled materials could foster a robust market for recycled goods.
• Policy Misalignment: Existing regulations focus on achieving specific collection and recycling rates but do not incentivize holistic circular practices such as reuse, refurbishment, and waste prevention. Moreover, certain directives prioritize quantity over quality in recycling, leading to downcycling of materials. Alignment of chemical regulations with circular policies is crucial to facilitate material reuse.

3. Policy and Regulatory Gaps:

• Product Design and Labelling: Regulations related to product design and labelling may lack clear guidelines for designing products for circularity or communicating their sustainability credentials to consumers. Comprehensive circular economy practices outlined in initiatives like the Extended Producer Responsibility (ESPR) are still in the early stages of implementation, leaving regulatory gaps in this area.

In summary, addressing regulatory barriers, incentivizing the use of recycled materials, and aligning policies with circular economy objectives are essential steps in overcoming challenges associated with integrating circular economy practices, particularly concerning CRMs.