Your Complete Guide to Sustainable Fashion Policy in Europe

It’s no secret that Europe is ahead of the United States when it comes to climate policy, and the fashion industry is subject to the continent’s broad corporate regulations as well as specific rules related to textiles and apparel. 

The European Union has been working to tackle issues like textile waste, supply chain transparency, and data reporting for the last decade. These policies often apply to any retail company that sells into Europe, meaning that large US-based brands and retailers are often not exempt. 

Read on to learn more about the latest sustainable fashion policies in Europe, and the ways in which investing in a resale program may help your brand comply with new requirements.

Circularity and Extended Producer Responsibility

In 2020, the EU generated an estimated 6.95 million tons of textile waste, lower than the estimates for the United States, though still significant. European consumption of textiles has the fourth-highest impact on the environment and climate change, following food, housing, and transportation. 

Many EU member states have individual textile policies that could make resale and trade-in essential for compliance. For example, France's Anti-Waste Circular Economy Law (AGEC) requires that brands reuse, donate, or recycle any unsold items, while in The Netherlands, producers are responsible for financing the entire textile collection and reuse system. But to address textile waste broadly, the EU has outlined a number of rules and plans under the EU Circular Economy Action Plan (CEAP). 

The CEAP is a major part of the European Green Deal, which aims to make Europe the first climate-neutral continent by 2050. It was adopted by the European Commission in 2020, and includes sustainability plans for a wide range of industries, including textiles. To implement the commitments under CEAP, the EU developed a Strategy for Sustainable and Circular Textiles, which focuses on four major goals for the industry and individual policies connected to each:

1. Develop ecodesign measures to ensure that textile products are fit for circularity, ensuring the uptake of secondary raw materials and the absence of hazardous chemicals. In July 2024, the Ecodesign for Sustainable Products Regulation went into effect, which will allow the EU to set rules around product durability, circularity, and energy use over time. The regulation also requires large and eventually mid-sized businesses to disclose the number and weight of products they discard annually. ‍
2. Ensure the accessibility of reuse and repair services. While regulation hasn’t yet gone into effect when it comes to repair and reuse, the EU says it plans to “incentivise circular business models, including reuse and repair sectors.” It also launched a campaign called RESet the Trend, which aims to raise awareness about sustainable fashion across Europe.
3. Make “fast fashion out of fashion” so that consumers benefit longer from high-quality, affordable textiles. In March 2024, new rules went into effect that ban vague environmental claims and require companies to provide information on durability and reparability.
4. Producers take responsibility for their products along the value chain with sufficient capacities for recycling and minimal incineration and landfilling. In May 2024, a new regulation on waste shipments was adopted to prevent illegal shipments of EU waste, including textiles, to other countries. And by January 2025, under the Waste Framework Directive, EU member states that don’t already have separate textile waste collection are required to set it up. That will require significant investments in infrastructure and technological solutions.

While brands will have to consider a number of new business models to meet the regulations under CEAP, resale can help them align with many of its goals. Meaningful investments in resale help companies minimize the number of products they send to landfills or abroad, prioritize high quality garments that have longer lives, and meet requirements related to waste collection. And unlike other climate investments that are hard on the bottom line, resale allows for continued sales growth and new customer acquisition.

‍Climate Targets, Claims, and Disclosures

Consumers and regulators can’t hold corporations accountable for their environmental impact without public disclosures. Much like in California, the EU has put forward a number proposals and rules around climate reporting and greenwashing. The goal is to stop brands from overstating their sustainability efforts, and to develop documentation around climate impact.

The Green Claims Directive, an EU proposal that’s currently being negotiated, would require companies to substantiate claims they make about environmental aspects or performance of their products and organizations using robust, science based and verifiable methods. 

The Corporate Sustainability Reporting Directive (CSRD) will require nearly 50,000 companies doing business in the EU to report their impacts on the environment and society on an annual basis. The aim of the policy is to help investors, civil society organizations, consumers, and other stakeholders evaluate the sustainability performance of companies they engage with. Large companies are required to submit their first reports under the CSRD by January 1, 2025. 

Separately, the Corporate Sustainability Due Diligence, went into effect in July of 2024 and will require large companies to identify and address the potential and actual adverse human rights and environmental impacts of their operations.

As more of these reports become available in the coming year, public officials and the press will be analyzing them to find companies with big carbon footprints and looking to implement additional policies to reduce corporate climate impact. For the fashion industry, new clothing production is the largest contributor to carbon emissions. If brands can generate ample revenue from resale, they may be able to reduce their production of new garments and therefore significantly shrink their greenhouse gas emissions. 

Are you ready to invest in a resale program or looking for help navigating the new regulatory environment? Reach out to our team at info@archiveresale.com