Arent Fox LLP
01/08/2025 | News release | Distributed by Public on 01/08/2025 09:41
California Passes Producer Responsibility Law for Textiles: Three Takeaways
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In 2024, California enacted the Responsible Textile Recovery Act, the nation's first extended producer responsibility (EPR) law specifically targeted at textiles and apparel. The law aims to shift responsibility for textile disposal from landfills to the businesses that create cloth and apparel products. It requires textile and apparel "producers" to jointly create a program for textile reuse and recycling in California and imposes compliance and financial obligations.
The law is part of a growing trend of EPR laws in California and other states in other product contexts. We have covered this trend here and here.
Law Summary
California's Act requires producers of covered textile and apparel to create and join a producer responsibility organization (PRO), which will administer the state's textile stewardship program. The law's key points are outlined below.
What Products Are Covered?
The Act applies to "apparel" (clothes, footwear, and accessories) and "textiles" (household goods made from fibers, such as blankets, curtains, towels, and bedding).
Who Are the Product "Producers"?
The Act applies to certain product manufacturers, brand owners, importers, and retailers, depending upon their physical presence in California. If an entity located in the state both manufactures a covered product and owns or licenses the product's brand, that entity is the "producer" of the covered product. If the manufacturer is located outside of California, but the brand owner or licensee is in state, then the brand owner or licensee is the responsible producer. If all brand owners or licensees are out of state, then the producer is the entity that imports the covered product into the state for sale or distribution. Last, if there is no importer in the stream of commerce, then the distributor or retailer who sells the product in or into California is the responsible producer.
Producers with less than $1 million in annual global revenue are exempt from the Act.
When Does the Program Start?
The law creates an implementation timeline. Key milestones are set forth below.
- By January 1, 2026: Producers must form a PRO.
- By July 1, 2026: The California Department of Resources Recycling and Recovery (CalRecycle) must approve the PRO, and producers must join the approved PRO.
- By March 1, 2027: The PRO must submit an assessment of the state's textile reuse and recycling needs.
- By July 1, 2028: CalRecycle must adopt regulations to implement the stewardship program.
- Once the Regulations Are Effective: The PRO has one year to create a stewardship program plan to collect, repair, and recycle apparel and textiles. CalRecycle has 120 days to review the plan. Once CalRecycle approves the plan, the PRO has one year to implement it.
- By July 1, 2030: Or when CalRecycle approves the plan, whichever comes first, producer obligations take effect. Thereafter, a retailer, importer, distributor, or online marketplace will not be allowed to sell, distribute, offer for sale, or import a covered product in or into the state for sale in the state, unless the producer of the covered product is a member of the PRO and the product is covered by the plan.
What Must the Stewardship Program Do?
The PRO's stewardship program must provide a free and convenient collection system for covered products, including physical collection sites across the state. The PRO must also establish a statewide consumer education program. The law asks the PRO to explain how it will create incentives to prioritize reuse and address emerging regulated substances, including per- and polyfluoralkyl substances, microfibers, and microplastics.
The costs of the PRO, stewardship program, and state oversight will be spread proportionally among producers according to their respective California sales and environmental impact. The program will have an "eco-modulated" fee structure - crediting producers for design choices and existing repair, reuse, and recycling programs that help achieve the law's goals.
What Are the Penalties for Noncompliance?
CalRecycle may assess administrative civil penalties up to $10,000 per day for violations and up to $50,000 per day for intentional or knowing violations.
Takeaways
There are three key takeaway points from the new law:
- Distributors and Retailers Have Obligations, Too: Once California's textile stewardship program takes effect, retailers and distributors may not sell covered products that are out of compliance with the law. CalRecycle must list compliant producers on its website, and the onus is on distributors and retailers to check the list and ensure their merchandise is compliant.
- Fashion Firms Need to Think About Packaging, Too: In addition to EPR for textiles, California previously enacted a producer responsibility law for packaging materials. Beginning January 1, 2027, producers of covered packaging may not sell products in the state unless they comply with the law. Further, starting January 1, 2032, producers must reduce their use of plastic packaging, and all covered packaging must be compostable or recyclable.
- State Producer Responsibility Laws Are a Growing Trend: In addition to textiles, California requires EPR or stewardship programs for many other products, including packaging, mattresses, electronic waste, carpets, paint, beverage containers, and pharmaceutical or sharps waste. Other states may follow California in regulating these items. For instance, in 2023, New York considered but did not pass an EPR bill for textiles.
Members of the firm's Fashion & Retail Law and Environmental teams regularly monitor legislative, regulatory, and other legal developments impacting the fashion, retail, and sustainability spaces.