EU ban reshapes fashion inventory rules

From 19 July 2026, large companies in the European Union’s textile and fashion sector are prohibited from destroying unsold or returned products under the Ecodesign for Sustainable Products Regulation (ESPR). The ban covers clothing, footwear, hats and accessories, making long‑standing disposal practices for excess inventory and returns no longer permissible for these firms.

Medium-sized enterprises will come under the same ban from 2030, giving them additional time to adjust their inventory and returns strategies. Small companies are excluded from the measure, leaving the regulatory focus on larger operators that place significant volumes of textile products on the EU market.

The ESPR obliges affected companies to prioritise keeping products in use instead of destroying them. Firms must first seek to sell unsold items, including through discounted sales or alternative market channels, or donate them to charities and social enterprises.

Where resale or donation is not possible, companies are required to prepare goods for reuse through repair, refurbishing or remanufacturing. Recycling and other recovery options should be favoured where appropriate, creating a hierarchy that places destruction as a last resort and, for most products, a prohibited option.

The regulation introduces an annual transparency requirement for operators that dispose of unsold products. Companies must publish the number and weight of unsold items they have disposed of over the year, giving a clearer picture of the scale of remaining waste.

They must also disclose the reasons for disposal and the proportion of items directed to reuse, repair, recycling, other recovery routes or final disposal. In addition, firms need to report on measures taken or planned to prevent destruction in the future, tightening scrutiny over inventory and returns management.

The ESPR allows limited derogations where destruction of unsold products remains permissible. These include products that are dangerous, damaged, deteriorated or defective, as well as goods that do not conform to applicable standards or requirements.

Destruction is also allowed for products that infringe intellectual property rights or that cannot reasonably be reused. These exceptions are intended to address safety, legal compliance and practical constraints while still sharply curbing destruction of otherwise usable goods.

Reporting cited in connection with the new rules estimates that up to about 9% of textile products placed on the EU market have been destroyed before ever being used. This corresponds to roughly 594,000 tonnes of textiles annually and an estimated 5.6 million tonnes of associated CO2 emissions.

The same reporting indicates that average online-fashion return rates are around 20%, underlining the volume of goods that can become excess inventory. The new regulatory framework is therefore set against a backdrop of high returns and historically significant levels of pre‑use destruction in the textile sector.