EU Bans Fashion Brands From Destroying Unsold Inventory to Cut Environmental Harm

The European Union has implemented a new law prohibiting fashion manufacturers from destroying unsold clothing items, aiming to reduce environmental damage caused by waste. The regulation, effective since two days ago, targets large companies with over 250 employees and annual revenues exceeding 50 million euros. These companies can only destroy items if they are unsafe, defective, or rejected by charities, and must publish annual reports on discarded goods while keeping records for five years. The law will extend to medium-sized companies by 2030 and affects retailers, wholesalers, and producers, even though only 20% of fashion items are made within the EU.

The legislation addresses the issue of high return rates in online fashion sales, where one in five items ordered online in the EU is returned and not resold. According to the European Environment Agency, 4% to 9% of unsold textiles are destroyed annually. Luxury brands, which often destroy inventory to maintain exclusivity and prevent secondary market sales, will need to find alternative solutions such as discounts, secondary markets, or donations. The law also clarifies that certain recycling methods that reduce product value, known as downcycling, count as destruction.

Consumers may benefit in the short term from increased availability of brand clothing in secondhand and outlet markets due to companies offloading excess stock. However, there are concerns that companies might circumvent the law by exporting surplus inventory outside Europe, such as to Asia or Africa, where destruction would occur beyond EU regulatory oversight.

In contrast, Israel currently lacks similar legislation. Although the Israeli Ministry of Environmental Protection issued a call for research on textile waste regulation four years ago, no significant progress has been made. Dr. Meital Peleg Mizrahi, a research fellow at Yale University, notes that environmental and climate legislation in Israel is still marginal, especially in fashion, and that price-sensitive Israeli consumers might strongly oppose laws that increase clothing costs.