By Jordan Wolman

Presented by Prologis

U.S. trade groups are speaking out against a new European effort to cut Packaging waste. The U.S. government appears to be taking up the cause as well. | Mario Tama/Getty Images

UP IN ARMS — New packaging regulations under debate in the European Union could become the next flash point in trade relations between Washington and Brussels.

American industry groups have the attention of U.S. government agencies in their campaign against the European effort to cut down on the waste from packaging for consumer products ranging from fresh produce to mini shampoo bottles in hotel rooms, Jordan and Leonie Cater report.

The U.S. trade groups are warning that the legislation, which would place strict recycled content and reuse requirements on both domestic and imported products, could force them to curb their exports to Europe.

“It could be a huge trade issue,” said Jennifer Turner, director of the China Environment Forum at the Wilson Center, a nonpartisan think tank that specializes in international affairs. “Other countries trying to sell into the EU will be concerned as well.”

U.S. officials at the Agriculture and Commerce departments have made the trek to Brussels to wade into the frenzy. The U.S. mission to the EU earlier this year co-hosted an event in the European Parliament — a “US-EU Dialogue on Sustainable Packaging” — alongside conservative Italian lawmaker Pietro Fiocchi, a vocal skeptic on the proposal’s reusable packaging targets.

Among the concerns from U.S. businesses: The American Chamber of Commerce to the EU has said the restrictions could have “negative impacts on international trade in products.” The U.S. Dairy Export Council is demanding exemptions from the reusable packaging and recycled content requirements, arguing that it would be logistically difficult and carbon-intensive to have used packaging sent back to U.S. producers to refill. The Distilled Spirits Council of the U.S. expressed concern that a provision forcing companies to scrap “superfluous” packaging used solely for branding purposes “prohibits brands and eliminates competition” – and could enable counterfeiters.

European lawmakers were meant to vote on the proposal this week; that’s been postponed to next month amid deep divisions in the parliamentary committee responsible as a heavy U.S. lobbying presence takes shape.

Green groups are pushing lawmakers to forge ahead. The measures are "more than necessary to fulfill their intended environmental objectives," said Marco Musso of the European Environmental Bureau.

It’s not the first time in recent memory that Brussels’ long regulatory arm is spooking American business. But this latest chapter underscores the deep economic concerns associated with Europe’s attempt to thread the needle between the environment and international trade — as officials try to hold together a Western economic alliance to combat China.

“There is a real potential” for the regulations to negatively impact exports to Europe for food growers and distributors, said Max Teplitski, the chief science officer at the International Fresh Product Association, whose membership includes U.S.-based and global exporters to Europe as well as European producers. “We’re certainly determined, and we’re active on this issue.”

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CARROTS, NOT STICKS — The Treasury Department has released principles for net-zero financing and investment to highlight best practices among financial firms implementing decarbonization plans. It’s an effort to promote consistency and credibility for net-zero claims made by banks and money managers, especially for “financed emissions” that make up the bulk of their pollution.

The principles announced earlier today include aligning net-zero targets with limiting global warming to 1.5 degrees Celsius and considering a “managed phaseout” of fossil fuel financing. Treasury hyped outside commitments from philanthropic organizations such as Bloomberg Philanthropies and the Bezos Earth Fund, which are shelling out $340 million over the next three years to boost resources for financial firms to execute net-zero targets.

The Glasgow Financial Alliance for Net Zero announced that more than 50 U.S. financial firms will publish net-zero transition plans over the next year. And the Partnership for Carbon Accounting Financials will train as many as 2,500 people on greenhouse gas accounting methodologies.

“There’s increasing demand for technologies, products and services that will reduce greenhouse gas emissions and support a clean energy future,” Treasury Secretary Janet Yellen says in remarks prepared for a speech in New York later today. “This demand is fueling growth in new industries and business models.”

Treasury officials were far more sanguine during a press call with reporters to discuss the net-zero principles:

"This is not meant to create new resources or materials or guidance that don't already exist," they said, later adding: "We're not suggesting anyone needs to do anything."

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NEWSOM SPEAKS — California Gov. Gavin Newsom says he’s planning to sign a pair of landmark corporate climate disclosure bills that promise to reshape the landscape both for how large corporations report on their carbon footprint and how climate change is impacting their bottom line.

While speaking on a panel Sunday on the opening day of Climate Week NYC, Newsom announced his intention to back SB253 and SB261, which cleared California’s legislature last week. The bills would require large corporations doing business in the state to disclose their emissions, including those from their Supply chains, along with their climate-related financial risks. Some 5,400 companies would be affected.

Together, the California bills go beyond U.S. Securities and Exchange Commission rules proposed more than a year ago that have yet to be finalized amid speculation that the agency might back away from requiring supply chain disclosures and the near-certainty of legal challenges no matter what it comes out with.

For his part, Newsom noted that the California bills might require some kind of “clean up,” Ry Rivard reports from the scene. That’s music to the ears of the California Chamber of Commerce, which lobbied against the measures and might propose cleanup legislation next year.

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MUSK’S NEXT WIN — The strike roiling Detroit’s Big Three automakers could hand Elon Musk another major victory over U.S. competitors looking for ways to eat into non-union Tesla’s electric vehicle dominance.

The financial gains UAW workers are seeking could widen Tesla’s labor-cost advantage over Ford, General Motors and Stellantis, and Tesla — cutting against President Joe Biden’s goal of shaping the green transition around union-friendly policies. The strike comes as the White House has already found itself having to warm to the staunchly anti-union Musk by embracing Tesla’s charging system as the industry standard after having previously kept him at arm’s length.

The Big Three were already facing a situation where they needed to lower prices and roll out new models to win market share. A lengthy strike or a big win for unionized workers could help to ensure Tesla’s continued market dominance, James Bikales reports.

Tesla, by the way, is getting courted to open new factories overseas — with Turkey being the latest suitor, Claudia Chiappa reports.

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