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On January 19, 2026, the Federal Government published in the Official Gazette of the Federation (DOF) the Decree enacting the General Circular Economy Law. The purpose of this law is to protect the environment by extending the useful life of products and promoting the efficient use and valorization of waste materials.
The Law also introduces significant amendments to Mexico's environmental legal framework, particularly to the General Law of Ecological Balance and Environmental Protection and to the General Law for the Prevention and Comprehensive Managenment of Waste.
General Circular Economy Law
The General Circular Economy Law (hereinafter, the "Circular Economy Law") entered into force on January 20, 2026. However, in principle, the Federal Government must issue its implementing Regulations by July 19, 2026.
Origin of the Circular Economy Law
This new legal framework is not an isolated initiative. Rather, it forms part of an international trend aimed at transforming production and consumption models.
In this context, the Circular Economy Law aligns with Resolution 5/11 of the United Nations Environment Assembly, entitled Enhancing circular economy as a contribution to achieving sustainable consumption and production. Through this resolution, the United Nations urges States to develop regulatory frameworks and public policies that facilitate the transition toward a circular economy.
The implementation of this agenda is projected over the medium and long term, with consolidation scenarios extending toward 2040.
What is the Circular Economy?
Pursuant to Article 3, section VIII, the Law defines the Circular Economy as:
An economic model of sustainable production and consumption that includes systemic solutions for economic development, reducing environmental impact through technical and biological cycles that allow the sustainable retention and reintegration of product materials into the economy, guided by the core principles of eliminating waste and pollution, keeping products and materials in use, and regenerating natural systems.
General Circular Economy Law
Is the Circular Economy Law mandatory?
As a general law, the Circular Economy Law allocates powers and responsibilities among the Federation, the States, and the Municipalities. In simple terms, general laws establish mandatory bases upon which each level of government must legislate in the same subject matter.
Accordingly, the General Circular Economy Law requires the issuance of federal regulations, the harmonization of local legal frameworks, and the progressive adaptation of productive sectors toward more sustainable production and consumption models.
Moreover, the Law lays the groundwork for the creation of mandatory secondary rules applicable to the private sector, as well as regulations on tax incentives and public programs. We anticipate a direct, though gradual, impact on productive activities, international trade operations, waste management, and value chains.
How will the Circular Economy Law impact the private sector and international trade?
The Circular Economy Law establishes the implementation of "Extended Producer Responsibility" (EPR), which will trigger new obligations for certain producers and importers.
What is Extended Producer Responsibility (EPR)?
The Circular Economy Law defines Extended Producer Responsibility (EPR) as the policy whereby "the producer or importer is environmentally responsible for its product throughout its life cycle, in accordance with the Circular Management registered with the Ministry of Environment and Natural Resources (SEMARNAT) [...]."
It is important to clarify that not all producers or importers will automatically be subject to EPR obligations.
When must a producer or importer assume EPR?
Article 10 of the Circular Economy Law provides that SEMARNAT will issue general agreements for the implementation of EPR by "productive sector, product, or both." To this end, SEMARNAT must first call upon the private sector to participate in the drafting of the corresponding projects. Once adopted, producers and importers will be required to comply with the provisions of the general EPR implementation agreements.
In practical terms, producers and importers will only be subject to Circular Economy Law obligations if their activities or products are covered by future SEMARNAT general agreements.
Additionally, producers, importers, or coordinating organizations may enter into agreements with SEMARNAT, and producers and importers may voluntarily submit to audits conducted by PROFEPA.
What does Extended Producer Responsibility (EPR) entail?
Under the general agreements, producers and importers must incorporate circular design criteria (Article 36). In other words, they will be required to organize, promote, and, where appropriate, finance Circular Economy schemes for:
- the products they manufacture or import; or
- the utilization of waste through its collection (Article 37).
EPR therefore implies that producers and importers assume responsibility for managing the life cycle of their goods, including collection, recycling, reuse, or waste recovery schemes, in accordance with the applicable secondary regulations.
Producers or importers may comply with their circular economy obligations in the following ways:
- Directly;
- Indirectly, through authorized third parties;
- Through compensation measures.
These provisions will clearly have an impact on manufacturing activities and international trade operations, as they will condition the design, production, importation, and commercialization of goods on sustainability and environmental management criteria.
Circular Management Registry
Where subject to EPR, producers and importers must register their circular management schemes in the Circular Economy Registry, which will form part of the National Platform to be implemented, coordinated, and operated by SEMARNAT.
The Law introduces the concept of "circular management," defined as the set of stages and actions established by producers and importers for the life cycle of their products.
National Circular Economy seal and audits
Additionally, the Circular Economy Law creates the National Circular Economy Seal, which will identify products that comply with these principles and provide consumers with truthful, verifiable, and accessible information regarding such compliance. Products bearing the National Circular Economy Seal will be given preference in public procurement processes.
To this end, the Law provides for the performance of audits as a preventive mechanism, which are, in principle, voluntary. These environmental audits are designed to assess and verify the level of compliance with circular economy principles. Companies that meet the applicable audit criteria will be entitled to display the "National Circular Economy Seal" on their products.
Responsibilities and sanctions
Pursuant to Article 44 of the Circular Economy Law, producers and importers must submit to SEMARNAT the reports and documents required under the obligations set forth in their registered Circular Management schemes, within the applicable deadlines.
Failure to comply will result in the imposition of administrative sanctions as provided in the General Law of Ecological Balance and Environmental Protection.
Potential barriers to international trade?
Based on a legal analysis of the Circular Economy Law, we consider that "affected" importers, and where applicable exporters, must closely monitor the development of SEMARNAT's general agreement projects to ensure that the resulting measures are not discriminatory or constitute barriers to international trade.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
