More than 40% of the EU's municipal waste ends up in landfill sites
The European Union needs a dedicated agency to oversee and enforce EU waste legislation, a study recommends.
Illegal dumping continues on a "significant scale" and "many landfill sites are sub-standard", the report for the European Commission warns.
The authors say the problem has increased in recent years, as more waste is being generated and more material is shipped to the enlarged EU.
Each year, the 27-nation bloc produces an estimated 2.6bn tonnes of waste.
"Compliance with EU legislation is essential if we are to achieve the overarching goal of EU waste legislation, which is to protect the health of European citizens and the environment," said Environment Commissioner Stavros Dimas.
"We must look at all the options, including setting up an EU agency or body which could enable EU legislation to deliver the maximum benefits for citizens, the environment and the EU economy."
The EU has about 60 legal acts (directives, regulations and decisions) that are designed to ensure that waste is managed properly.
However, the report warns that "many parts of the EU" are falling "significantly short" of the legal obligations.
The authors identify a number of key problems, including:
• Member states lacking frontline capacity to enforce the laws
• Poor co-ordination between national bodies and agencies
• Some nations see the waste laws as a "low priority"
• Nations have different interpretations of the legislation
"The powers and resources needed to address the underlying problems effectively at EU level are however lacking," the report observes.
"The Commission lacks investigatory powers... when verifying complaints from citizens about possible infringements.
"This creates difficulties for the Commission to fulfil its duty as 'Guardian of the Treaties' and ensure that EU waste legislation is correctly applied by member states."
If an agency was established, the authors said that it could review nation's strategies, offer training and advise the Commission on areas where legislation needed amending or updating.
The new body would cost an estimated 16m euros (£14m), and would employ about 60 members of staff in its headquarters.
The report suggests that it would lower the burden on taxpayers because it would reduce the clean-up costs of illegal dumping and sub-standard landfill sites.
Steve Lee, chief executive of the UK's Chartered Institution for Wastes Management, welcomed the idea of a pan-European agency.
"The environment we are trying to protect is bigger than any one EU member state, so even standards of wastes and resources management across the EU are vital," he told BBC News.
"The UK works hard to implement EU controls and to comply so we have little to fear, much to gain."