In linear business models, producers and commercial intermediaries transfer ownership over products to final consumers, who buy and own these products for some time, and then discard them (turn them into “waste”). The consumer sales contract represents the final link in global value chains which consist of multiple cross-border commercial contracts. Existing consumer laws in EU Member States provide for extensive protection of consumers in the context of such “ownership-based” consumption of products, and even, to some extent, encourage unsustainable consumption choices. EU waste law has attempted to mitigate the worst environmental impacts of the linear economy and throwaway society, by establishing a waste hierarchy and, for certain products such as electronic devices and batteries, imposing extended producer responsibility (EPR) schemes.

In contrast, circular business models (CBMs) break away from this traditional approach. Here, manufacturers or retailers no longer sell their products down the chain but become service providers who retain ownership of the product and its material resources. The final user does not “consume” the product but rather enjoys “access-based” consumption, based on a rental contract, a lease contract, a contract of works, a service contract, or another contract directly concluded with the service provider – typically online.