Europe's plan to make pharmaceutical and cosmetics manufacturers pay for the bulk of advanced wastewater treatment has hit a serious legal obstacle. On 7 September, Advocate General Juliane Kokott of the Court of Justice of the European Union advised the court to annul the provision that assigns at least 80% of the additional micropollutant removal costs to those two sectors. Her opinion, while not binding, exposes deep methodological weaknesses in the legislation and injects fresh uncertainty into a scheme whose first payments are barely two years away.
The contested cost-sharing rule
The disputed provisions sit inside the revised Urban Wastewater Treatment Directive, which entered into force earlier this year. They establish an extended producer responsibility (EPR) system requiring makers of medicinal products and cosmetics to finance at least four-fifths of the extra treatment steps needed to strip micropollutants, residues of active pharmaceutical ingredients, personal-care chemicals and similar substances, from urban wastewater before discharge. The remaining share would fall to taxpayers and water consumers. Contributions become payable in 2029 but will be calculated on sales volumes recorded in 2028, meaning companies are already factoring the expected charges into production and supply decisions.
Why the Advocate General objects
Kokott's opinion, delivered after Poland challenged the directive, centres on the evidence base used to justify the 80% split. She found that the Commission's impact assessment relied on a 'toxic load' methodology that suffered from significant gaps. Data for several pharmaceutical substances were incomplete or unreliable, and the analysis did not adequately account for other potential sources of micropollutants, industrial chemicals, agricultural runoff, or household products, that also reach sewers. Without a credible quantification of each sector's contribution, the fixed 80% allocation lacks a sound footing, she concluded.
The Advocate General also questioned whether the assessment properly considered the proportionality of burdening two sectors with the overwhelming share of costs when the pollution profile is more diffuse. Her recommendation is that the relevant articles be struck down, leaving the court to decide whether the rest of the directive can stand without them.
Industry reaction: pause and rewrite
Pharmaceutical trade bodies welcomed the opinion as validation of long-standing complaints. Steffen Saltofte, who heads Medicines for Europe and the generic manufacturer Zentiva, argued that clean water and essential medicines are both public goods and that Europe should not sacrifice one for the other. He called for an immediate pause in implementation and a thorough review to ensure environmental protection does not create avoidable risks to medicine availability.
The European Federation of Pharmaceutical Industries and Associations (EFPIA) echoed that position. Director General Nathalie Moll said the federation supports the polluter-pays principle but insists the cost distribution must reflect actual responsibility. She urged the Commission to halt the directive while a new, transparent impact assessment identifies all relevant micropollution sources. Adrian van den Hoven, Director General of Medicines for Europe, warned that the looming cost burden could push companies to discontinue certain medicines, reduce supplies to European markets, or redirect investment elsewhere.
What the numbers show
The Commission's own figures put the annual cost of the advanced treatment upgrades at between €1.48 billion and €1.8 billion by 2045. Industry groups say estimates prepared by some national authorities are substantially higher. Because the EPR fees will be based on 2028 sales, manufacturers face a near-term hit to cash flow and pricing models well before the infrastructure is fully operational. That timing is a core part of the industry's argument that the scheme distorts investment decisions before its legal basis is settled.
Commission stance and the Polish challenge
The Commission has so far resisted reopening the file. As recently as March it rejected calls for a legislative review, maintaining that producers should pay for pollution linked to their products rather than leaving the bill to the public purse. Poland's challenge, backed by several other capitals, argued that the cost allocation was arbitrary and disproportionate. The Advocate General's agreement with Warsaw on the methodological flaws gives the challenge substantial weight, though the court has departed from its advisers' opinions before.
Next steps and open questions
The Court of Justice will now deliberate, with a final judgment expected in early 2027. Until then, the directive remains in force. The Commission faces a choice: wait for the ruling and risk a chaotic scramble if the provisions fall, or propose a targeted amendment that addresses the methodological gaps while preserving the polluter-pays principle. Member states, meanwhile, must decide whether to press ahead with national transposition measures that could be rendered obsolete. For manufacturers, the 2028 sales baseline means the clock is already ticking on commercial decisions that the court may yet overturn.
People mentioned
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Juliane Kokott
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Steffen Saltofte
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Nathalie Moll
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Adrian van den Hoven
Organisations
Court of Justice of the European Union · European Commission · Medicines for Europe · European Federation of Pharmaceutical Industries and Associations · Zentiva
