Navigating CSR Compliance: Essential Regulations for Fashion Brands in France and Worldwide

CSR regulations in the textile and apparel sector in France

France is a pioneer in CSR legislation, and as we will see, several of its laws will soon be adopted at the European level.

It has notably legislated on producer responsibility in product end-of-life, due diligence for brands, and consumer information on environmental issues related to products.

French Textile Extended Producer Responsibility (REP)

In France, based on the polluter-pays principle, any actor placing a product on the market must finance its end-of-life management (collection, sorting, and valorization). This is known as **Extended Producer Responsibility (**Responsabilité Élargie du Producteur, REP).

To organize this, REP schemes have been created for different product categories, including the apparel, household linen, and footwear (Textile, Linges de maison et Chaussures, TLC) sector, established in 2009.

Companies that are part of a REP scheme collectively finance an approved eco-organization through an eco-contribution. This organization takes care of their obligations related to the end-of-life of their products. For the textile sector, Refashion (formerly known as Eco-TLC) fulfills this role.

Recently, the AGEC law (Anti-Gaspillage pour une Économie Circulaire, Anti-Waste for a Circular Economy) has introduced new provisions related to REP, such as a unique logo to guide consumers in waste sorting, a bonus-malus system for eco-contributions by companies, and the creation of new REP schemes to include more products in the framework.

To learn more about the latest regulations related to REP for textiles, we invite you to consult our articles on the new waste sorting information labels, the eco-modulations in the textile sector or the prevention and eco-design compulsory plan.

Corporate Due diligence in France

On the 24th of April 2013, the Rana Plaza, a building housing clothing manufacturing workshops, collapsed, resulting in over 1,130 deaths. In response to this catastrophe, the French due diligence law was enacted on the 27th of March 2017.

All companies with over 5,000 employees if their headquarters are in France, or over 10,000 employees if their headquarters are abroad, must have a publicly available vigilance plan.

This vigilance plan should enable them to identify risks in their supply chains and prevent serious harm to people or the environment that could result from their activities, including through their subsidiaries, suppliers, or subcontractors.

Environmental Communication Regulation in France: AGEC and Climate and Resilience laws

To accelerate the ecological transition, the French authorities aim to promote sustainable consumption.

The AGEC and Climat et Résilience (Climate and Resilience) laws, enacted in 2020 and 2021, include several measures to better inform consumers about the environmental impacts of products.

For fashion brands, there are four key measures to note regarding consumer information:

• Display of environmental qualities and characteristics (qualités et caractéristiques environnementales, QCE) of products (Article 13 of the AGEC law)
• Environmental score for textile products (Article 2 of the Climate and Resilience law)
• Regulation of environmental claims (Article 13 of the AGEC law and Article 12 of the Climate and Resilience law)
• Waste sorting information labels (Article 17 of the AGEC law)

To learn more about these measures, please refer to our dedicated article.

Moreover, the Climate and Resilience Law has officially categorized greenwashing as a deceptive commercial practice punishable by law. To learn more, we invite you to read our dedicated article on the regulations governing greenwashing.

International CSR regulations in the fashion industry

While France is often cited as an example for its incentive laws promoting an ecological and social transition in the fashion industry, regulations are also emerging in other countries.

Textile CSR laws in the United States

The Uyghur Forced Labor Prevention Act (UFLPA) came into effect in June 2022 to ban products made through forced labor of Uyghurs in the Xinjiang region from the US market. Several products, including cotton-based textiles, are affected.

The UFLPA stipulates that companies importing into the United States must be able to prove

• either that their products do not come from the Xinjiang region
• or, if they do, that they are not produced through forced labor.

This requires the implementation of robust traceability processes that allow brands to map all actors in their supply chains and collect the necessary evidence for import authorization of their products.

Other laws signal a regulatory shift towards the duty of vigilance for fashion brands:

• The California's Garment Worker Protection Act, that prohibits California garment manufacturers from paying employees less than the minimum wage and holds ordering brands accountable.
• The proposed New York's Fashion Sustainability and Social Accountability Act (on the 2024 legislative agenda) and the federal FABRIC Act, inspired by the California law.

The State of California has also adopted a bill that will require companies with over 1 billion dollars in revenue operating in the Californian market to annually disclose their greenhouse gas emissions report (scopes 1 and 2 starting from 2026, scope 3 from 2027). This law is named the Climate Corporate Data Accountability Act.

The use of hazardous substance is also regulated by the TSCA (Toxic Substances Control Act) of 1976: the EPA (Environmental Protection Agency) has the ability to restrict the use of specific substances in the manufacturing process of finished goods or product parts. Penalties for non-compliance arise to $50,000 USD per day and per violation.

Textile CSR laws in Germany

In Germany, the duty of vigilance is also mandatory under the LkSG (Supply Chain Due Diligence Act). It came into effect on the 1st of January 2023, for companies with over 3,000 employees and will also apply to companies with over 1,000 employees from the 1st of January 2024.

Among the obligations it imposes are appointing a accountable person, conducting a risk analysis, publishing a risk management, prevention, and reduction strategy, establishing a complaint procedure within the supply chain, and reporting.

Textile CSR laws in the United Kingdom

In the United Kingdom, the Modern Slavery Act was enacted in 2015. It requires brands with a turnover of over £36 million to publish a modern slavery statement and imposes a due diligence mechanism.

Environmental reporting has also been made mandatory through two amendments regarding non-financial reporting by companies (The Companies (Strategic Report) (Climate-related Financial Disclosure) Regulations 2022 and The Limited Liability Partnerships (Climate-related Financial Disclosure) Regulations 2022). For more information, you can refer to the FAQs published by the UK government.

Regulating the fashion industry at the EU level: the European textile strategy

On March 30, 2022, the European Commission adopted the European Union strategy for sustainable and circular textiles to meet the expectations of European citizens regarding human rights, which have grown significantly since the Rana Plaza disaster, and to address the urgency of establishing rules to mitigate climate disruption.

In line with this strategy, as well as with the European Green Deal and the European Circular Economy Action Plan, the European Union has set ambitious goals for CSR regulations in the textile sector, aiming to transform it through a comprehensive approach.

The objective is to make the fashion industry sustainable, responsible, circular, environmentally friendly, and respectful of human rights by 2030.

For more details on the European Textile Strategy and its components, we invite you to consult our dedicated article.

Here is, however, the list of texts and projects to be aware of to understand how European regulations will impact the textile industry:

• The proposal for a regulation on ecodesign for sustainable products (ESPR): minimum sustainability requirements for textile products.
• The proposal for a directive on sustainable corporate due diligence (CSDD).
• The proposal to ban products made through forced labor (Forced Labour Ban).
• The proposals for the Empowering Consumers and Green Claims directives that regulate environmental claims and labels to combat greenwashing and demand greater transparency from brands regarding product sustainability.
• The project to revise the Waste Framework Directive and the Waste Shipment Regulation to promote circularity in the textile sector.
• The project to integrate the textile industry into the European taxonomy to define criteria for sustainable textile actors according to investor standards.
• The directive on corporate sustainability reporting (CSRD), already adopted, which will replace the non-financial reporting directive from 2024 with increased requirements.

Another European law, this time addressing leather goods or furniture brands, demands complete traceability across the entire production chain: the European Regulation on Deforestation-free Supply Chains. Enacted in June 2023, it will come into effect in 2024. To grasp the obligations stemming from this new legislation, please refer to our article.

Table summary of all the regulations to know

Conclusion

As the European Union and national governments gradually regulate the fashion industry to make it sustainable, it becomes urgent and strategic for brands to map their supply chain, including their tier 2 and higher-tier suppliers.

Indeed, traceability is essential to:

• Identify social and environmental risks as required by due diligence
• Collect the necessary data for mandatory ESG reporting and impact measurement.
• Meet regulatory transparency requirements.
• Verify the accuracy of claims regarding the environmental and social performance of products.
• Demonstrate compliance with increasingly stringent environmental and social laws.