Digital Product Passport Implementation by small and medium size companies: Challenges for Chilean exporters to the european market
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Abstract
The European Union’s Digital Product Passport (DPP) initiative, a central component of its Circular Economy Action Plan, aims to enhance transparency and sustainability across product lifecycles. In sectors involving critical raw materials (CRMs)—such as lithium, a key input in battery manufacturing— DPP implementation poses unique challenges for small and medium-sized enterprises (SMEs) in resource-exporting countries like Chile. This paper examines the barriers Chilean SMEs face in complying with DPP requirements for the European battery value chain. Although Chile plays a pivotal role in the global lithium supply, many SMEs involved in mining services, processing, and logistics lack the digital tools, standardized data systems, and lifecycle traceability mechanisms needed to meet EU expectations. Challenges include limited technical knowledge of DPP standards, underdeveloped digital infrastructure, low regulation in international data flow and the high cost of compliance in an increasingly regulated global market. Through stakeholder interviews and policy analysis, this study explores how Chilean SMEs perceive the DPP and identifies systemic barriers to its implementation. It further evaluates the risk of supply chain exclusion if compliance gaps are not addressed. At the same time, the paper highlights opportunities for capacity-building, including government support programs, international cooperation, and digital innovation initiatives that could help SMEs adapt. By focusing on critical raw materials in the battery sector, this research contributes to the broader understanding of how DPP implementation affects global supply chains and emphasizes the need for inclusive digital transition strategies to ensure SMEs remain competitive in the European market.Keywords:
Digital Product Passport , SMEs , Critical Raw Materials , Supply Chain , ComplianceReferences
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