Wear It or Share It: EU Bans Destruction of Unsold Apparel

The ESPR was adopted in 2024 and replaced an older EU law that only covered destruction of energy-related products. The ESPR expands sustainability rules to cover nearly all physical products. The goal is to reduce waste and promote a “circular economy,” where products are reused rather than thrown away. The destruction ban is the first major restriction under the new rules.

Affected Products and Companies

Product Scope

The destruction ban in the ESPR currently covers three product categories:

• Apparel (clothing of all types).

• Accessories (bags, scarves, hats, etc.).

• Footwear.

The EU has the authority to add more product categories to this list in the future, so companies in other sectors should keep an eye on developments.

Company Scope

The rules apply differently depending on company size.

• Large companies (over EUR 50 million in annual revenue or EUR 43 million in assets, and 250+ employees): Must comply now, as of July 19.

• Medium-sized companies (up to EUR 50 million in revenue or EUR 43 million in assets, and fewer than 250 employees): Must comply starting on July 19, 2030.

• Small and micro businesses (up to EUR 10 million in revenue or assets, and fewer than 50 employees): Fully exempt and the ban does not apply.

Importantly, the ban applies to all products sold in the EU, even if a company is based outside of Europe. Non-EU brands and retailers selling into EU countries must follow these rules too.

The Destruction Ban

Under the ESPR, “destruction” means disposing of unsold products as waste, in any form. This includes not just landfills and incineration but also recycling. The underlying principle is that products should remain in use for as long as possible before entering any waste stream.

Actions that are not considered destruction under the ESPR include:

• Donating to charities or social enterprises.

• Selling through discount or secondary channels.

• Repairing, refurbishing, or remaking the products.

• Preparing products for reuse.

In addition, all businesses, regardless of size, have a general duty under the ESPR to take reasonable steps to avoid needing to destroy unsold products in the first place.

Permitted Exceptions Under Delegated Regulation C(2026) 659

In February, the EU adopted rules listing 10 situations where destroying unsold products is permitted. These exceptions are narrow and must be documented (see Section 5).

Destruction is allowed only when:

• The product is unsafe or poses a health risk.

• The product does not meet legal requirements.

• The product is counterfeit (infringes someone’s intellectual property).

• The license to sell the product has expired.

• The condition of the product makes it unsuitable for reuse.

• The product is damaged and cannot be used by consumers.

• The product has a design or manufacturing defect.

• The company tried to donate the product, either by contacting at least three charities or listing it on a donation platform for at least eight weeks but could not find a recipient.

• A charity or social enterprise holds the inventory and cannot find a recipient.

• The product was prepared for reuse but the company could not find a recipient.

Even when an exception applies, companies must still follow the “waste hierarchy”: recycling comes before burning for energy or sending to a landfill.

Importantly, the European Parliament and Council have two months to review these exceptions. If either raises an objection, the exceptions will not take effect, and the ban will apply without any carve-outs.

Recordkeeping and Disclosure Obligations

Companies that destroy products under one of the exceptions described above, and large companies that discard unsold products more generally, must keep records and publicly report on their practices.

• Recordkeeping: Companies must keep supporting documents on product destruction (safety reports, test results, inspection records, proof of donation efforts, etc.) for at least five years. If authorities request these records, they must be provided electronically within 30 days. When sending products for waste treatment, companies must include a written statement identifying which exception applies. One set of records can cover an entire batch of similar products.

• Public Disclosure: Large companies must publish an annual report showing how many products they discarded (by number and weight), why they were discarded, what type of waste treatment was used, and what steps are being taken to reduce future destruction. This information must appear on a public webpage or in the company’s sustainability report. Reporting for 2025 data is due in 2026, and a standardized template becomes mandatory around March 2027.

Enforcement and Penalties

Each EU country’s respective market surveillance authorities are responsible for enforcing the ESPR rules. They can inspect businesses, request documentation, and check whether companies are properly using exceptions.

Penalties vary by country. For example, under older EU rules, fines in Germany reached EUR 50,000 per violation and could go higher if calculated based on profits. Given the increased focus on sustainability, companies should expect active enforcement, especially in countries that have historically taken an active approach to environmental compliance.

Next Steps for Affected Companies

If your company makes, imports, or sells clothing, accessories, or footwear in the EU, you may want to consider these steps.

1. Check if the rules apply to you: Confirm your company size, identify which products are covered, and review whether any unsold inventory is currently being destroyed.

2. Set up alternative channels: Build relationships with charities, resale platforms, and discount retailers before you have excess stock.

3. Create documentation and reporting processes: Make sure you can support any exception you rely on and meet the annual public disclosure requirements.

We will continue to monitor developments, including the review period for the exceptions and any expansion to additional product categories. ArentFox Schiff’s Fashion Counsel team is here to help you understand and comply with these new requirements.