Increased focus on sustainability and environmental stewardship is changing the legal and regulatory landscape affecting the fashion and textiles industry, providing new challenges for textile and garment manufacturers, distributors, and retailers. This article provides ten tips for sustainability professionals to navigate compliance issues throughout their supply chains. At a minimum, it is critical to know the materials used in your products and the details of your supply chain to effectively identify applicable environmental rules, regulations, and requirements—as well as track changes as they occur. Particularly for the fashion and textiles industry, with its significant environmental footprint, a clear understanding of product components and corresponding legal requirements form the necessary foundation to ensure compliance and minimize environmental enforcement risk.
1. Identify All the Materials Used in Your Product.
It is important for textile manufacturers to have a thorough understanding of the materials used in the manufacture and construction of their products. Chemical composition laws and regulations, responsible sourcing requirements, and recycled content mandates impose restrictions on textile manufacturers, distributors, and retailers that use or sell articles containing certain minerals or compounds. For example, the European Union (EU) restricts several chemicals that may be included in textile articles. The EU Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH) law, the EU’s primary chemical regulation, limits the use of phosphates, phosphinoxides, biphenyls, and several other compounds applied in the development of textile articles, with heightened restrictions for chemicals that come into contact with skin. EU REACH also restricts the use of the widely found Perfluorooctanoic acid (PFOA) chemical and its salts in articles with certain exemptions. In addition, the United States (U.S.) and the EU also have conflict mineral disclosure obligations for certain minerals that are used by the fashion industry in finishing details, embellishments, and jewelry, such as gold, diamonds, and mica. On top of these restrictions, recycled content mandates and labeling requirements are becoming increasingly common both in the United States and globally.
2. Conduct Due Diligence to Minimize Supply Chain Risks.
Responsible sourcing is a growing focus for both U.S. and international regulators. For example, alleged human rights abuses within the Xinjiang Uyghur Autonomous Region (XUAR) in China have recently prompted enforcement actions concerning products imported into the U.S. The U.S. Customs and Border Protection agency issued Withhold Release Orders for a number of goods coming from the XUAR on human rights grounds, such as cotton and cotton products, prohibiting their release from U.S. ports. Other countries have enacted or are seriously considering due diligence and modern slavery laws to try to address human rights abuses within supply chains. Accordingly, it is important for companies with complex supply chains to conduct due diligence to identify and eliminate human rights and modern slavery risks. Such due diligence also provides companies with documentation to present to regulators in the event that regulators bring an enforcement action.
3. Track Changing Environmental Laws and Regulations in all Jurisdictions Where Your Business Operates.
Environmental laws and regulations can vary greatly between countries and even between regions within countries. To reduce risk exposure, it is critical to understand the environmental legal regimes in the countries and regions in which you operate. Further, with increasing global attention on climate change and sustainability, many countries and governing bodies are adopting or are in the process of adopting new domestic environmental laws and regulations, as well as international treaties and agreements. Per- and polyfluoroalkyl substances (PFAS), advanced recycling, microplastics, and microfibers are all emerging areas in which the industry is likely to see relevant, new environmental laws and regulations in the near future. To reduce enforcement risks, it is important to review periodically the environmental laws and regulations impacting your operations in key jurisdictions to proactively adapt to any changes.
National Law Review, 9 June 2021