Each month, Copenhagen Fashion Week delves into the European policy landscape and its implications for the fashion industry to keep brands and our wider network informed about the latest developments in the regulatory sphere.
Year Round Up: A Summary of legislative developments in 2023
The European Union has been taking significant strides toward reducing carbon emissions and building a more sustainable future with the textiles industry being one of their core focuses. Fashion brands based in the EU will be highly impacted by the numerous regulations and directives rolling out in the coming years.
As 2023 has come to an end, we will take stock of last year’s regulatory developments.
Waste Framework Directive
In 2023 the European Commission proposed an amendment to the Waste Framework Directive, targeted to the textile industry. There are currently numerous EPRs in use across the different Member States and the goal of this new regulation is to harmonise them.
The new Regulation on Waste Shipments aims to facilitate the sustainable management of textile waste across the EU by encouraging producers to reduce waste and increase the longevity of products while holding them accountable for the cost associated with textile waste management. Costs will be based on eco-modulation (the overall environmental performance of the textile). Indicators of performance are based on several factors such as the choice of materials, circularity of the products, due diligence in supply chains, or accuracy of information provided to consumers.
Regulation on Waste Shipments
In 2021, the Waste Framework Directive on waste shipments was adopted. Initially, the directive aimed to foster a circular economy and ensure that the EU does not ship its textile waste to nations in the Global South.
You’re likely to see the acronym EPR – short for Extended Producer Responsibility used in reference to this directive. It contains several new rules that will “make producers responsible for the full lifecycle of textile products” which includes everything from product design to textile waste and recycling. Member States will be required to establish systems for the separate collection of textile waste by 1 January 2025. Every country will have its own EPR where fashion brands are required to join an EPR for each country. In practice, this means that fashion brands must establish a closed-circle supply chain that ensures waste collection and recycling of the clothes produced.
Ecodesign for Sustainable Products Regulation (ESPR)
The Ecodesign Directive currently only covers energy-related products and will be expanded to include textiles and other sectors. This regulation aims to make products durable, reliable, reusable, upgradable, reparable, easier to maintain, refurbish and recycle as well as energy and resource-efficient.
Fashion brands wishing to sell in the EU marketplace will need to address product design from beginning to end, taking into account a product’s durability, recyclability, and inclusion of recycled materials. For the fashion and textile sector this also means a heightened focus on transparency and traceability. The new ecodesign requirements for textiles are expected to be finalised by 2025.
The regulation also introduces the Digital Product Passport which will make it easier for consumers to repair or recycle products as well as track substances used throughout the supply chain.
Digital Product Passport
The Digital Product Passport will have significant implications for the fashion and textile industry. All products placed on the European market must have a product passport. This tool will serve as a digital record that provides comprehensive information about a product’s environmental footprint throughout its lifecycle.
Every product must include a machine-readable passport, such as a QR code, that is linked to a unique product ID. For fashion and textile brands, this can include:
- The product’s durability, reusability and repairability
- Percentage of recycled content
- The product’s carbon footprint
- And the product’s circularity performance related to its inherent capacity to be recycled and its environmental sustainability, among other requirements
Additional specifications on the Digital Product Passport are expected to be published in 2024, although it is still unclear when it will go into effect.
Directive on Green Claims
With 230 different environmental labels, it’s no wonder consumers are confused when navigating sustainability claims. A Commission study found that 53% of green claims give vague, misleading or unfounded information while 40% of claims have no supporting evidence. The Green Claims Directive will empower consumers to make informed decisions by mitigating greenwashing and misleading environmental claims.
Any green claims such as “this product has a reduced carbon footprint” will need to be independently third-party verified and scientifically proven. Rules ensuring claims are clearly communicated will be enacted too. Aggregate scoring of a product’s overall environmental impact on e.g. biodiversity, climate, or water consumption may no longer be allowed.
Overall this directive aims to improve the information presented on product labels, particularly in regards to their durability and repairability. As such, any claims related to sustainability will need to be substantiated by third-party reviewed data, obtained by using a standard methodology for life cycle assessment (LCA). Any new labeling schemes will no longer be allowed unless permitted by the EU with a clear demonstration of added value to the authorities.
Revision of the Textile Labelling Regulation
The current Textile Labelling Regulation is limited to fibres. leading to a confusing amalgamation of labelling systems across the EU. It also does not keep pace with the development of new fabrics and recycling technologies. The Commission is planning to revise the current Textile Labelling Regulation in the fourth quarter of 2023 in order to streamline product label requirements.
The revision will introduce specifications for both physical and digital labelling of textiles. Here, brands will need to implement more comprehensive and standardised labelling practices, ensuring consumers have access to accurate information about the composition and origin of textile products. As a result, fashion and textile brands must prepare to adapt their labelling procedures to comply with these new regulations, thereby promoting fair competition and bolstering consumer confidence in their purchasing decisions.
Product Environmental footprint method (PEF)
The EU is working on the product environmental footprint method (PEF) which specifically contains data for the apparel and footwear sector. The PEF incorporates several environmental indicators into a product’s environmental footprint assessment such as carbon emissions, water usage or energy consumption.
Once the Green Claims Directive has been implemented, it will be even more important for fashion and textile brands to incorporate a carbon management tool into their workflow. In March 2023 the Commission published a proposal for this directive: while it has not yet been implemented, consulting firm Deloitte estimates that the requirements for this directive will apply from 2026.
Initially, the CSRD will apply to large companies that are already subject to the NFRD. This includes large public-interest companies with more than 500 employees. However, the CSRD is expected to eventually extend to all large companies, whether they are listed or not.
Additionally, there are plans to gradually extend the CSRD requirements to SMEs but this will likely be on a voluntary basis at first. The aim is to not overburden smaller businesses with the same level of reporting requirements as larger corporations. Listed SMEs on the other hand might have to adhere to simplified reporting standards under the CSRD but they will have the option to opt out for a transition period (until 2028).
Even though the CSRD was implemented in 2023, reporting requirements will be gradual, beginning in 2024 and reflected in reports published in 2025. The EU is currently working on the European sustainability reporting standards (ESRS) to operate as the framework for the disclosure of ESG information.
Corporate Sustainability Due Diligence Directive (CSDDD)
The CSDDD will affect companies in high-impact sectors such as fashion and textiles with 250+ employees and a net turnover of more than 40 million euros worldwide by compelling them to assess and mitigate the environmental and social impacts of their operations and supply chains. By mandating a comprehensive evaluation of potential risks and adverse effects, the directive aims to foster responsible business practices. It encourages transparency, ethical sourcing and the integration of sustainability measures throughout the production and distribution processes of textiles.
It’s important to highlight that it is not about achieving specific results; instead, this directive aims for companies making a concerted effort to improve their environmental and social impacts. In other words, the directive expects companies to take meaningful steps towards sustainability and ethical practices, but it doesn’t require them to achieve certain predetermined outcomes.
What does that mean for a fashion brand? It means creating visibility and traceability throughout value chains. Fashion and textile brands will need to develop due diligence policies, identify human and environmental impacts of their activities and prevent potential or actual negative effects. All of this must be communicated publicly for both regulators and consumers.
Once the CSDDD has been formally adopted by the EU (not expected before 2024), Member States will have two years to implement the CSDDD into national law. As the CSDDD is a directive, member states can go above and beyond the minimum requirements set out by the EU.
