Will Regulation Drive Consolidation in the Packaging Sector?

Packaging regulation is tightening on both sides of the Atlantic, although Europe and the United States are taking different routes. For example, in Europe, the Packaging and Packaging Waste Regulation (PPWR) became effective on 12 August 2026. PPWR creates a common framework covering packaging design, recyclability, recycled content, reuse and waste reduction across Europe. While the United States has no direct equivalent, regulation is developing state by state. California, Oregon and Colorado are examples of states that are among those introducing extended producer responsibility schemes that place more of the cost of packaging waste on packaging producers.

While these regulations look and feel different, they create the same commercial pressures. Packaging companies will need to invest more in design, materials, testing and data to adapt to regional regulatory changes. While larger groups can spread those costs across a wider customer and production base, smaller businesses cannot do so as easily. This raises an important question: will further sustainability regulation drive a new wave of consolidation in the packaging industry?

European vs. United States Models

The PPWR is more than an update to existing EU packaging regulations. It changes how packaging must be designed and how its performance will be measured. From 2030, packaging placed on the EU market will need to meet recyclability requirements. Plastic packaging will also face minimum recycled-content targets. By 2035, recyclable packaging will need to be recycled at scale. The regulation applies to packaging sold in the EU, regardless of where it was produced. A North American supplier exporting into Europe will therefore face many of the same requirements as an EU manufacturer.

In the United States, the picture is less consistent. Oregon’s extended producer responsibility program began operating in the middle of 2025. Colorado is moving towards a statewide system in 2026. California’s rules under Senate Bill 54 became effective earlier this year and introduced significant sustainability targets. By 2032, the state aims to reduce single-use plastic packaging and food service ware by 25%. It also seeks to have 65% of these materials recycled, with all covered packaging recyclable or compostable.

The U.S. may not have a single federal framework, but its state-led approach creates its own burden. Companies must monitor different rules, deadlines and reporting systems. For packaging groups selling across several states, that can be just as difficult as adapting to a single large piece of regulation.

This article examines how regulatory pressures could reshape competitive dynamics, influence M&A activity and drive further consolidation, including a case study on the International Paper acquisition of DS Smith. Download the full article below.