AB 405: Fashion Environmental Accountability Act of 2025.

Existing law requires the State Air Resources Board, on or before July 1, 2025, to develop and adopt regulations requiring specified partnerships, corporations, limited liability companies, and other business entities with total annual revenues in excess of $1,000,000,000 and that do business in California, defined as reporting entities, to publicly disclose starting in 2026 or on a date to be determined by the state board, and annually thereafter, their scope 1 and scope 2 greenhouse gas emissions, as defined, and, starting in 2027 and annually thereafter, their scope 3 greenhouse gas emissions, as defined, for the reporting entitys prior fiscal year, as provided.

Existing law prescribes additional duties on specific industries for a variety of purposes, including those that promote the public health, safety, and welfare relating to issues that are unique to that industry. Existing law, for example, requires any tanning device used by a tanning facility to comply with all applicable federal laws and regulations.

This bill would enact the Fashion Environmental Accountability Act of 2025 and would require fashion sellers to carry out effective environmental due diligence, as provided. The bill would vest the Department of Toxic Substances Control with jurisdiction over fashion sellers compliance with ensuring that a fashion sellers covered fashion products, as defined, do not contain any regulated chemicals, as defined, above thresholds the act would establish, as provided. The bill would authorize the department to adopt regulations to implement, enforce, interpret, or make specific portions of the act under its jurisdiction, as provided. The bill would vest the state board with jurisdiction over a fashion sellers environmental due diligence under the act pertaining to emissions of greenhouse gases. The bill would require a fashion seller, in carrying out its effective environmental due diligence, to comply with certain environmental guidelines that, at a minimum, require the fashion seller to, among other things, embed responsible business conduct in its policies and management systems, identify areas of significant risks of societal and ecological harms from its own activities and its supply chain relationships, identify, prioritize, and assess the significant potential and actual adverse impacts of those risks, and cease, prevent, or mitigate those risks, as provided. The bill would require a fashion seller, beginning July 1, 2027, and annually thereafter, to submit to the department and the state board an Environmental Due Diligence Report pertaining to the effective environmental due diligence performed by the fashion seller for the prior calendar year, as provided. The bill would specify that fashion sellers are reporting entities for purposes of above-described public disclosure requirement for emissions of greenhouse gases and would require the disclosure be reported on their Environmental Due Diligence Report. The bill would require a fashion seller, in carrying out its environmental due diligence, to establish establish, on or before July 1, 2027, a quantitative baseline for their emissions of greenhouse gases and targets for reductions in the emissions of greenhouse gases in the near-term and long-term covering their scopes 1, 2, and 3 emissions, as provided. The bill would require a fashion seller to include in its Environmental Due Diligence Report certain information related to its greenhouse gas emissions.

The bill would require a fashion seller, on or before January 1, 2027, to ensure that their covered fashion products do not contain any regulated chemicals above the acts thresholds, as provided. The bill would prohibit, on and after January 1, 2028, a person from manufacturing, selling, or distributing in commerce any covered fashion product that contains any regulated chemicals above those thresholds, as specified. The bill would authorize the department or the Attorney General to enforce the acts thresholds, as specified, and would punish violations of the threshold requirements and of the act that are enforced by the department with an administrative or civil penalty not to exceed $5,000 for a first violation, and not to exceed $10,000 for each subsequent violation, as specified. The bill would subject a fashion seller in violation of the act to a civil penalty of up to 2% of its annual revenue penalty, as provided, for violations enforced by the state board. The bill would authorize the department and the state board, as appropriate, to seek appropriate equitable remedies for a violation of the act. The bill would require the civil penalties collected by the state board to be deposited into the Fashion Environmental Remediation Fund, which the bill would establish in the General Fund. The bill would require moneys in the fund, upon appropriation by the Legislature, to be expended for purposes of implementing the act and one or more environmental benefit or environmental remediation projects that directly and verifiably benefit the communities directly impacted, to the extent practicable, at the location the injury has occurred. projects.