What is the micro-enterprise exemption under the PPWR?

The micro-enterprise exemption under the PPWR is a set of legal carve-outs that relieve businesses with fewer than 10 employees and under EUR 2 million in annual turnover from certain packaging conformity, design, and re-use obligations. The Article 29 re-use targets fall away only when both limbs are met: micro-enterprise status and no more than 1,000 kg of packaging made available in that Member State in the calendar year. None of these carve-outs touches the packaging EPR obligation itself.

The Packaging and Packaging Waste Regulation (PPWR) introduces strict, harmonised rules across the European single market to ensure all packaging is recyclable, minimised, and safely managed. However, European lawmakers recognised that applying the full weight of these administrative and logistical requirements to tiny operations - such as independent bakeries, small retail boutiques, or family-run cafes - could be financially devastating. Preparing an EU declaration of conformity, funding independent laboratory tests for recyclability, or building reverse logistics networks for reusable packaging requires capital and dedicated compliance teams that small businesses simply do not have.

To prevent the regulation from inadvertently crushing small commerce, the PPWR does not offer a single, blanket waiver, but rather a series of targeted exemptions. These carve-outs shift the heaviest legal burdens up the supply chain to larger suppliers, or simply exempt the smallest actors from specific volume-based targets. By utilising these exemptions, very small businesses can continue trading without facing the severe operational disruptions that larger corporations must navigate to achieve compliance.

What the micro-enterprise exemption actually means

To qualify for any of these exemptions, a business must first meet the strict legal definition of a micro-enterprise as set out in Commission Recommendation 2003/361/EC (Commission Notice - Guidance document for Regulation (EU) 2025/40 on packaging). This requires the enterprise to employ fewer than 10 persons and have an annual turnover or annual balance sheet total that does not exceed EUR 2 million.

If a business meets this definition, it can benefit from several distinct regulatory reliefs. The most significant of these is the shift in the legal definition of the "manufacturer". Under normal PPWR rules, if you have packaging designed under your own brand name or trademark, you are legally considered the manufacturer and bear sole responsibility for its conformity. However, there is a specific exception for micro-enterprises.

Under Article 15(12), where the person that has the packaging or packaged product designed or manufactured under its own name or trademark is a micro-enterprise, and the person that supplies the packaging is located in the Union, the supplier counts as the manufacturer.

The condition is that the supplier is located in the Union. It is not that the supplier sits in the same Member State as the brand owner, so a micro-enterprise in Ireland keeps the shift when it buys branded boxes from a supplier in Portugal.

A micro-enterprise that orders branded boxes from a packaging supplier located anywhere within the European Union passes the burden to draw up the technical documentation and demonstrate conformity onto that supplier (Packaging and Packaging Waste Regulation (EU) 2025/40). Article 21 applies the same shift to micro importers and distributors selling under their own brand.

Additionally, micro-enterprises benefit from exemptions related to re-use. Economic operators are exempt from the mandatory transport and sales packaging re-use targets if they make not more than 1,000 kg of packaging available on the territory of a Member State in a calendar year and meet the micro-enterprise definition. Furthermore, final distributors in the hospitality sector who qualify as micro-enterprises are completely exempt from the obligation to offer hot beverages or ready-prepared food in reusable take-away packaging.

Does this apply to me?

Yes, if your business headcount and financial totals sit below the 10-person and EUR 2 million thresholds. This applies to you whether you are selling goods online, running a high street shop, or operating a cafe.

However, you must look closely at your corporate structure. If you operate as a franchisee, you might assume you are a micro-enterprise because your specific shop only employs five people. But if the franchisor directly or indirectly owns 25 percent or more of your capital or voting rights, or exercises control over your business, you must calculate your thresholds by adding the franchisor's corresponding data. In most franchise models, this immediately pushes the business over the limit, meaning the exemptions will not apply.

You must also consider where you source your packaging. The liability shift that protects micro-enterprises from having to draft technical documentation only applies if the supplier of the packaging is located within the Union. If you import your branded packaging directly from a supplier in Asia or the Americas, the protection fails, and you must assume the full legal responsibilities of a manufacturer yourself.

What turnover and headcount thresholds qualify a business for the PPWR micro-enterprise exemption?

Common misconceptions about the micro-enterprise exemption

"I am completely exempt from the entire regulation."

This is a dangerous misunderstanding. The PPWR does not offer a blanket exemption for small businesses. You are exempt from specific provisions, such as calculating re-use targets or drawing up technical files for branded packaging, but you must still ensure that the packaging you use is compliant, and the EPR obligation in Article 45(1) still lands on you if you are the first to make the packaging available in a Member State. That obligation has no turnover or volume de minimis. Below 10 tonnes a year in a Member State you get the reduced Article 44(8) data set, which is simplified reporting, not an exemption.

"If I buy packaging from China, my supplier is the manufacturer."

The legal shift that forces the supplier to act as the manufacturer only applies if that supplier is located within the Union. If you are a micro-enterprise but you import your custom-branded boxes from a third country, you act as the importer and the manufacturer, meaning you must conduct the conformity assessments yourself.

"I do not have to allow customers to bring their own cups."

While Article 33 exempts micro-enterprises from the obligation to actively offer their own reusable take-away packaging, Article 32 requires all final distributors in the HORECA sector to provide a system for consumers to bring their own containers to be filled by 12 February 2027. There is no micro-enterprise exemption for this specific "bring your own" rule.

"My tiny cafe is automatically allowed to keep using single-use plastic plates."

Article 25 bans single-use plastic packaging for food and beverages consumed within HORECA premises from 1 January 2030. While Member States are permitted to grant an exemption to micro-enterprises for this rule, it is not automatic; you must demonstrate that it is not technically feasible to use alternative packaging or access re-use infrastructure.

5 examples of the micro-enterprise exemption in practice

1. The artisan bakery liability shift: A small family bakery in Austria with four employees orders bread bags printed with its logo from a packaging supplier in Germany. Because the bakery is a micro-enterprise and the supplier is located in the Union, the German supplier is legally considered the manufacturer and must draw up the EU declaration of conformity. The two being in different Member States makes no difference.
2. The small e-commerce seller: A tiny online retailer operating out of a garage ships 800 kg of products in transport packaging to customers in France over a calendar year. It meets both limbs of Article 29(13), micro-enterprise status and under 1,000 kg in that Member State, so the transport packaging re-use targets that start in 2030 do not apply to it. Passing either limb, by growing past 10 staff or by shipping 1,100 kg, brings the targets back.
3. The independent coffee shop: An independent cafe with a turnover of EUR 400,000 sells coffee to go. Thanks to the exemption in Article 33, the cafe does not have to invest in a fleet of reusable take-away cups or join a deposit return system for its takeaway operations by 2028.
4. The franchise disqualification: A fast-food franchise location employs only eight people, but the parent company owns a 30 percent stake in the operation. Because the parent company's financial data must be added to the local shop's data, the shop exceeds the EUR 2 million threshold, loses its micro-enterprise status, and must offer reusable packaging.
5. The direct importer burden: A small local cosmetics brand buys its custom-moulded, branded plastic jars directly from a factory in China. Because the supplier is outside the EU, the micro-enterprise exemption for manufacturer liability does not apply, forcing the small brand to handle the complex conformity assessments itself.

Terms related to the micro-enterprise exemption

Frequently asked questions

How is a micro-enterprise legally defined under the PPWR?

The PPWR relies on the definition established in Commission Recommendation 2003/361/EC. A business is classified as a micro-enterprise if it employs fewer than 10 persons and its annual turnover or annual balance sheet total does not exceed EUR 2 million.

Does a micro-enterprise still have to write the EU declaration of conformity?

Plain, unbranded packaging leaves the entity that produced it as the manufacturer. Packaging designed under your own trademark would make you write the declaration, but as a micro-enterprise buying that branded packaging from an EU supplier, Article 15(12) shifts that responsibility to the supplier instead. Buy the same branded packaging from outside the EU and the duty stays with you.

Are micro-enterprises exempt from offering reusable takeaway containers?

Yes. Under Article 33, final distributors in the hospitality and catering sector must give consumers the option of obtaining takeaway products in reusable packaging by 12 February 2028, but a micro-enterprise is exempt from this requirement.

Do I still have to allow customers to bring their own cups?

Yes. Article 32 still requires every HORECA final distributor, including micro-enterprises, to provide a system letting consumers bring their own containers to be filled by 12 February 2027. Only the obligation to supply your own reusable cups is waived.

Are micro-enterprises exempt from all single-use plastic bans?

No. Bans on specific formats, such as shrink wrap for airport luggage or very lightweight plastic carrier bags, apply to everyone. For the dine-in single-use plastics ban, Member States may let micro-enterprises continue using them only if the business can show that switching to alternatives or accessing re-use infrastructure is not technically feasible.

What happens to my re-use targets if my business grows or I supply more packaging?

To be exempt from the re-use targets for transport and sales packaging, you must be a micro-enterprise supplying no more than 1,000 kg of packaging in a Member State in a calendar year, with both limbs required. If your headcount grows to 10 people, your turnover exceeds EUR 2 million, or you supply 1,001 kg, you lose the exemption and must meet the mandated percentages for reusable packaging, from 1 January 2030.

Sources:

• Commission Notice - Guidance document for Regulation (EU) 2025/40 on packaging
• Packaging and Packaging Waste Regulation (EU) 2025/40