The IOTA Foundation has highlighted how its digital trade infrastructure, developed alongside TWIN Foundation, could help businesses navigate increasingly stringent packaging compliance requirements as regulators impose tougher standards on international trade.
In a recent post on X, IOTA said missing or unverifiable packaging compliance data is becoming a significant obstacle for exporters, warning that inadequate documentation can result in border delays, rejected shipments and lost access to international markets. The organization argues that trusted, verifiable data exchange between supply chain participants and customs authorities can streamline compliance checks and facilitate cross-border trade.
The comments come as regulators, particularly in the European Union, continue expanding packaging regulations that require greater transparency around packaging materials, recyclability and chemical safety. Industry analysts increasingly view packaging compliance as a trade issue rather than simply a manufacturing or product design consideration.
Packaging Rules Are Becoming More Demanding
According to industry analysis published by Packaging Gateway, packaging has evolved into a regulated component of international commerce, with compliance requirements directly influencing whether products can enter major markets such as the European Union.
The EU’s Packaging and Packaging Waste Regulation (PPWR) is among the most significant policy changes reshaping the sector. The regulation strengthens requirements around recyclable packaging, material transparency and environmental sustainability while increasing scrutiny of potentially hazardous substances used in packaging materials.
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Particular attention has focused on per- and polyfluoroalkyl substances (PFAS)—often referred to as “forever chemicals”—alongside longstanding restrictions on heavy metals such as lead and cadmium. Manufacturers are increasingly expected to demonstrate not only that packaging complies with applicable rules but also to provide verifiable documentation showing how compliance has been achieved throughout the supply chain.
This represents a significant shift from previous compliance practices, where supplier declarations alone were often sufficient. Today, regulators increasingly expect end-to-end traceability covering raw materials, manufacturing processes and finished packaging.
Digital Verification Could Improve Supply Chain Efficiency
IOTA believes decentralized digital infrastructure can help address these growing documentation requirements.
The organization said TWIN enables participants across global supply chains—including manufacturers, logistics providers, customs authorities and border agencies—to securely exchange verified compliance information while allowing each organization to retain control over its own data.
Rather than replacing existing enterprise systems, TWIN is designed to function as a neutral interoperability layer that connects organizations using standardized, verifiable data. This approach aims to reduce administrative burdens while improving trust between trading partners that may operate under different regulatory frameworks.
The proposal aligns with a broader trend toward digital trade documentation as governments and international organizations seek to modernize customs processes and reduce paperwork associated with cross-border commerce.
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Industry experts note that packaging compliance failures increasingly carry commercial consequences beyond regulatory penalties. Goods may face customs delays, shipment rejections, or removal from distribution channels, creating additional costs for exporters and disrupting retail supply chains.
For businesses operating internationally, the challenge extends beyond designing compliant packaging. Companies must also maintain reliable records that can demonstrate compliance across increasingly complex global supply chains.
While IOTA positions TWIN as one potential solution, digital trade infrastructure is becoming an area of growing investment across both the public and private sectors as governments pursue greater efficiency, transparency and interoperability in international commerce.
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