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.

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 require a fashion seller, in carrying out its environmental due diligence, to establish 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 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 that moneys in the fund, upon appropriation by the Legislature, are 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.

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 environmental due diligence pertaining to chemical management and wastewaster testing. 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 require a fashion seller, in carrying out its environmental due diligence, to establish 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, by January 1, 2028, require a fashion seller, in carrying out its environmental due diligence, to, among other things, require all of its significant tier 2 dyeing, finishing, printing, and garment washing suppliers to sample and annually report to the fashion seller on wastewater chemical concentrations and water usage and to report the information provided by the suppliers in its Environmental Due Diligence Report. The

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, and revenue 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 that moneys in the fund, upon appropriation by the Legislature, are 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.

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 environmental due diligence pertaining to chemical management and wastewaster testing. The bill would vest the state board with jurisdiction over a fashion sellers environmental due diligence 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 require a fashion seller, in carrying out its environmental due diligence, to establish 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, by January 1, 2028, require a fashion seller, in carrying out its environmental due diligence, to, among other things, require all of its significant tier 2 dyeing, finishing, printing, and garment washing suppliers to sample and annually report to the fashion seller on wastewater chemical concentrations and water usage and to report the information provided by the suppliers in its Environmental Due Diligence Report. The bill would subject a fashion seller in violation of the act to a civil penalty of up to 2% of its annual revenue, and 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 to be deposited into the Fashion Environmental Remediation Fund, which the bill would establish in the General Fund. The bill would require that moneys in the fund, upon appropriation by the Legislature, are 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.

Date of Hearing: May 14, 2025

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Buffy Wicks, Chair

ABPCA Bill Id:AB 405

Author:(Addis) – As Amended Ver:May 1, 2025

Urgency: No State Mandated Local Program: No Reimbursable: No

SUMMARY:

This bill enacts the Fashion Accountability Act of 2025 (Act), requires a fashion seller to carry out “effective environmental due diligence,” and requires the Air Resources Board (ARB) and the Department of Toxic Substances Control (DTSC) to implement and enforce the Act.

Specifically, this bill, among other things:

1. Specifies that a “reporting entity” includes a “fashion seller,” as defined, for purposes of compliance with SB 253 (Wiener), Chapter 382, Statutes of 2023, the Climate Corporate Data Accountability Act (see background for more information).
2. Requires a fashion seller (seller), in carrying out its effective environmental due diligence, by July 1, 2027, to establish a quantitative baseline for and targets for reductions in the seller’s emissions of greenhouse gases (GHGs) covering the seller’s scopes one, two, and three emissions, as specified. Requires a seller, as part of its Environmental Due Diligence Report (Report), to report its compliance with the established targets and its GHG emissions in accordance with the requirements of SB 253.
3. Specifies that a seller that fails to meet the aforementioned targets has 18 months to reduce its GHG emissions to meet the targets and “return to the necessary reduction pathway to meet those targets.” Specifies that a seller with over $1 billion in revenue is deemed to be in violation of this bill if the absolute GHG emissions reported increases in five consecutive years.
4. Grants DTSC jurisdiction over a seller’s compliance with ensuring the seller’s covered fashion products, as defined, do not contain any regulated chemicals above the thresholds established by the bill. Grants ARB jurisdiction over a seller’s environmental due diligence pertaining to GHG emissions. Authorizes DTSC and ARB to promulgate regulations to implement this bill, as specified, and to develop an application process for accrediting entities to act as independent verifiers, as specified.
5. Requires every seller to carry out effective environmental due diligence, consistent with the bill’s requirements, for the portions of its business relating to fashion goods, as specified.
6. Requires a seller, by January 1, 2027, to ensure its covered fashion products do not contain any regulated chemicals above specified thresholds. Authorizes the Attorney General to enforce this provision. Prohibits, on or after January 1, 2028, a person from manufacturing, selling, or distributing in commerce any covered product sold, manufactured, or distributed by a seller that contains regulated chemicals above specified thresholds. Authorizes DTSC or the Attorney General to enforce this provision.
7. Authorizes DTSC, upon appropriation, to use the Toxic Substances Control Account (TSCA) to implement the bill.
8. Requires a seller, beginning July 1, 2027, and annually thereafter, to develop and submit to DTSC and ARB a Report, as specified, and requires DTSC and ARB to review the Report under their respective jurisdiction for completeness.
9. Specifies various enforcement actions ARB and DTSC are authorized to take against a noncompliant fashion seller, including specified civil penalties and “any appropriate equitable remedies”. Requires DTSC and ARB to use a risk-based approach in enforcing the Act and to publish enforcement guidelines before the enforcement of the Act. Allows any individual to report a violation of the Act.
10. Establishes the Fashion Environmental Remediation Fund and specifies that moneys in the Fund are available, upon appropriation, to DTSC and ARB for purposes of implementing the Act and one or more environmental benefit or remediation projects. Specifies that civil penalties and any other moneys appropriated for purposes of the Act be deposited into the Fund.

FISCAL EFFECT:

1) ARB and DTSC will incur significant ongoing costs, likely in the low millions of dollars, to implement the various requirements of this bill.

a) DTSC estimates costs of approximately $1 million for six positions in fiscal year (FY) 2026-27. DTSC notes this cost will increase over time to $5.5 million for 22 positions by FY 2033-34 to fully implement the provisions of the bill. Tasks include accrediting independent verifiers and annually reviewing Reports submitted by fashion sellers. To do so, DTSC would need to develop and maintain a portal. DTSC will also be responsible for ensuring fashion sellers’ products do not contain any regulated chemicals above certain thresholds. This type of chemical compliance determination would require DTSC to select and develop product testing protocols, conduct data “call ins”, and procure and test products on an ongoing basis.

Costs will be borne by TSCA, which is supported by the Environmental Fee. This fee is annually adjusted by the Board of Environmental Safety at a rate sufficient to cover DTSC’s operations. A $5.5 million increase is DTSC’s operational costs would place substantial pressure on the Environmental Fee, potentially necessitating a 4% increase.

b) ARB estimates General Fund costs of approximately $5.8 million in FY 2025-26 for 22.8 positions, $8.6 million in FY 2026-27 for 32.4 positions, and $7.9 million in FY 2027-28 and ongoing for 32.4 positions. These estimates include contract funds of varying amounts over multiple years. ARB contends it would need to determine the universe of entities subject to SB 253 disclosure requirements, determine methodologies for assessing quantitative baselines and targets for fashion sellers’ GHG emissions, promulgate regulations to establish reporting and verification requirements, develop a reporting platform and database to collect and analyze data submitted by reporting entities and track emission reductions in relation to established targets, undertake various enforcement-related activities, and numerous other tasks.

The FY 2024-25 budget provided $8.4 million and 28 new permanent positions for ARB to adopt and implement regulations pursuant to SB 253 and a related climate-related financial risk reporting law. The funding includes support for new staff at ARB, contracts, and legal representation to respond to pending litigation. The administration anticipates the costs of implementing the laws will grow in future years to ongoing amounts of $13.9 million for 42 permanent positions plus $4.3 million in contract funds beginning in FY 2026‑27. The spending plan authorizes using the Greenhouse Gas Reduction Fund (GGRF) to cover costs in FY 2024‑25 and 2025‑26, but plans that beginning in FY 2026‑27, GGRF funding will be phased out, repaid, and replaced by revenue from new fees charged to affected businesses as authorized by the legislation.

While ARB is set to receive significant resources for SB 253 – which may or may not cover a portion of its costs associated with this bill (as they relate to SB 253) – this bill creates a separate and parallel reporting structure for fashion sellers, which is likely to result in significant additional workload for ARB.

2) Possible costs (General Fund, special funds) to the Department of Justice (DOJ) of an unknown amount. Actual costs will depend on whether the Attorney General pursues enforcement actions, and, if so, the level of additional staffing needed by DOJ to handle the related workload. If DOJ hires staff to handle enforcement actions permitted by this bill, the department would incur significant costs, likely in the low hundreds of thousands of dollars annually. If DOJ does not pursue enforcement as permitted by this bill, the department would not incur any costs.

3) Cost pressures (Trial Court Trust Fund, General Fund) of an unknown amount to the courts to adjudicate enforcement actions authorized by this bill. Actual costs will depend on the number of cases filed and the amount of court time needed to resolve each case. It generally costs approximately $1,000 to operate a courtroom for one hour. Although courts are not funded on the basis of workload, increased pressure on the Trial Court Trust Fund may create a demand for increased funding for courts from the General Fund. The fiscal year 2024-25 state budget provides $37.3 million ongoing General Fund to backfill declining revenue to the Trial Court Trust Fund.

4) Costs incurred by DTSC and ARB may be offset by penalty revenue (Fashion Environmental Remediation Fund).

COMMENTS:

1) Purpose. According to the author:

Fast fashion has fueled a global crisis. We cannot stand by while companies profit from depleting natural resources, and using toxic chemicals that pollute and harm our environment and people. The Fashion Environmental Accountability Act will hold them accountable…By mandating transparency, this bill will push the industry to adopt more sustainable practices and reduce the harmful effects of fast fashion on our environment and our health.

2) Background. SB 253 requires US-based entities with more than $1 billion in annual revenue doing business in California to annually report all direct GHG emissions (scope one), indirect GHG emissions from consumed energy (scope two), and indirect upstream and downstream GHG emissions (scope three). SB 219 (Wiener), Chapter 766, Statutes of 2024, amends parts of SB 253 regarding regulatory timelines, and the timing of scope 3 emissions reporting, fee payment, and other provisions. In addition, there are layers of international standards that impact many of the companies covered by this bill. For more information about relevant state, federal, and international standards, please see the Assembly Natural Resources Committee’s analysis of this bill.

The author intends for this bill to reduce the negative environmental and public health impacts of the fashion industry by mandating fashion sellers report their supply chains, requiring companies to be responsible for their impact in those supply chains through an environmental due diligence framework, directing companies to set and achieve emission reductions, and requiring companies to work with their suppliers to reduce the use of toxic chemicals.

3) Support and Opposition. This bill is sponsored by the New Standard Institute. The organization argues that “without AB 405, toxic chemicals linked to cancer, brain development and hormone disruption will continue to enter the California market and the fashion industry will continue to fuel the climate crisis to which California is uniquely exposed. Without AB 405, the fashion industry’s emissions will exceed 25% of the world’s carbon budget in 25 short years.” The organization further contends that the opposition’s claim that the bill is a cost driver is false, “because McKinsey’s independent research reveals that the cost to decarbonize this industry is 2 cents on a cotton tee shirt.” Finally, among other points, New Standard Institute argues this bill does not duplicate SB 253 or other laws already on the books, but rather, “integrates with it and builds on it.”

Among other industry groups in opposition, the California Chamber of Commerce (CalChamber) notes the bill imposes “costly, duplicative, and misaligned regulatory requirements” on apparel companies that will “increase clothing prices and worsen affordability for Californians, all without delivering meaningful improvements to global supply chain practices.” CalChamber argues the state’s climate disclosure mandates are already proving to be problematic, noting SB 253 is “facing serious implementation issues. The California Air Resources Board (CARB) recently announced it would delay enforcement, acknowledging the significant compliance challenges associated with the law.” CalChamber contends many of the same companies impacted by SB 253 would now be impacted by this bill, “except the scope of impacted companies would be increased by a factor of 10.” CalChamber further argues that while the bill sets a threshold of what constitutes an impacted “fashion seller” as $100 million dollars annual gross receipts, “many much smaller suppliers that are part of the global textile supply chain would be indirectly captured by virtue of doing business with larger companies.”

Analysis Prepared by: Nikita Koraddi / APPR. / (916) 319-2081

Date of Hearing: April 28, 2025

ASSEMBLY COMMITTEE ON NATURAL RESOURCES

Isaac G. Bryan, Chair

ABPCA Bill Id:AB 405 (

Author:Addis) – As Amended Ver:April 21, 2025

SUBJECT: Fashion Environmental Accountability Act of 2025

SUMMARY: Establishes the Fashion Accountability Act of 2025 (Act), which requires fashion sellers, as defined, to carry out effective environmental due diligence.

EXISTING LAW:

1. Establishes the Responsible Textile Recovery Act of 2024 [SB 707 (Newman), Chapter 864, Statutes of 2024], which creates an extended producer responsibility (EPR) program for stewardship of waste textiles under the oversight of the Department of Resources Recycling and Recovery. Requires producers of covered products to form and join a producer responsibility organization (PRO), a nonprofit 501(c)(3), and sell textile products in California only under a PRO plan that governs the collection, transportation, repair, sorting, recycling, and safe and proper management of textile products in the state. (Public Resources Code 42984 et seq.)
2. Requires the Air Resources Board (ARB), pursuant to California Global Warming Solutions Act of 2006 [AB 32 (Núñez), Chapter 488, Statutes of 2006], to adopt a statewide greenhouse gas (GHG) emissions limit equivalent to 1990 levels by 2020, and (Health & Safety (HSC) Code 38500 et seq):
   1. Requires the reduction of GHGs to 40% below 1990 levels by 2030 and to 85% below 1990 levels by 2045, and:
   2. Authorizes ARB to adopt a regulation that establishes a system of market-based declining annual aggregate emission limits for sources or categories of sources that emit GHG emissions, applicable until December 31, 2030. Under this authority, ARB adopted a cap and trade regulation that applies to large industrial facilities and electricity generators emitting more than 25,000 metric tons of carbon dioxide equivalent per year, as well as distributors of fuels, including gasoline, diesel, and natural gas.
   3. Requires the monitoring and annual reporting of GHG emissions from GHG emission sources beginning with the sources or categories of sources that contribute the most to statewide emissions, and dictates that for the cap-and-trade program established pursuant to AB 32, entities that voluntarily participated in the California Climate Action Registry prior to December 31, 2006, and had developed a GHG emission reporting program, they would not be required to significantly alter their reporting or verification program except as necessary for compliance.
3. Establishes the Climate Corporate Data Accountability Act, which requires ARB to require a reporting entity (businesses with revenues in excess of $1 billion that do business in California) to report the entity’s Scope 1, Scope 2, and Scope 3 GHG emissions.
   1. Defines “Scope 1 emissions” as direct GHG emissions that stem from sources that a reporting entity owns or directly controls, regardless of location, including fuel combustion activities.
   2. Defines” Scope 2 emissions” as indirect GHG emissions from consumed electricity, steam, heating, or cooling purchased or acquired by a reporting entity, regardless of location.
   3. Defines “Scope 3 emissions as indirect upstream and downstream GHG emissions, other than Scope 2 emissions, from sources the reporting entity does not own or directly control, including purchased goods and services, business travel, employee commutes, and processing and use of sold products. (HSC 38532)
4. Requires the Department of Toxic Substances Control (DTSC) to adopt regulations to establish a process to identify and prioritize chemicals or chemical ingredients in consumer products that may be considered chemicals of concern, as specified. (HSC 25252)
5. Requires DTSC to adopt regulations to establish a process to evaluate chemicals of concern in consumer products, and their potential alternatives, to determine how to best limit exposure or to reduce the level of hazard posed by a chemical of concern. (HSC 25253)
6. Specifies, but does not limit, regulatory responses that DTSC can take following the completion of an alternatives analysis of chemicals of concern in consumer products, ranging from no action to a prohibition of the chemical in the product. (HSC 25253)
7. Prohibits, on and after June 1, 2006, a person from manufacturing, processing, or distributing in commerce a product, or a flame-retarded part of a product, containing more than one-tenth of one percent of pentaBDE or octaBDE. (HSC 108922)
8. Prohibits, on and after January 1, 2025, a person from manufacturing, distributing, selling, or offering for sale in the state a new textile article, as defined, that contains regulated perfluoroalkyl and polyfluoroalkyl substances (PFAS). (HSC 108970)
   

THIS BILL establishes the Act, which:

1. Defines terms used in the bill, including:
   1. “Fashion goods” (covered products) to mean apparel, footwear, and fashion bags, as specified.
   2. “Fashion seller” as a business entity that does business in the state involving the sale of fashion goods in excess of $100 million in annual gross receipts. Does not include multibrand retailers, unless the total annual gross receipts of all of the private labels under the retailer exceed $100 million.
   3. “Regulated chemicals” as azo-amines and arylamine salts, bisphenols, flame retardants, formaldehyde, phthalates, and lead.
   4. “Significant supplier” as suppliers representing 75% of fabric by volume.
   5. “Supply chain tiers” as:
      1. “Tier 1 suppliers” as suppliers that produce finished goods for sellers, including sewing and embroidering, as specified;
      2. “Tier 2 suppliers” as suppliers to Tier 1 that provide services, including knitting, weaving, washing, dyeing, finishing, printing, and components and materials for finished goods, as specified;
      3. “Tier 3 suppliers” as suppliers to Tier 2 suppliers that process raw materials, such as spinning; and,
      4. “Tier 4 supplies” as companies that supply raw materials to Tier 3 suppliers.
   6. “Thresholds” to mean the allowable level of regulated chemicals in a covered product:
      1. No greater than 20 parts per million (ppm) for azo-amines and arylamine salts;
      2. No greater than 10 ppm for bisphenol-A for textiles and leather, no greater than 100 ppm for bisphenol-B and bisphenol-F, and no greater than 200 ppm for all bisphenols;
      3. No greater than 10 ppm for flame retardants;
      4. No greater than 75 ppm for formaldehyde;
      5. No greater than 500 ppm for phthalates; and,
      6. No greater than 1 ppm for lead.
2. As part of a seller’s mandatory GHG reporting to ARB, requires sellers to:
   1. Establish a quantitative baseline and targets for reductions of the seller’s emissions of GHGs in the near-term and long-term covering the seller’s scope 1, 2, and 3 emissions, as specified.
3. As part of the Environmental Due Diligence Report, requires sellers to report:
   1. Compliance with the targets established; and,
   2. GHG emissions inventory that conforms with specified accounting and reporting requirements.
4. If the seller does not meet the targets, specifies that the seller has 18 months to reduce GHG emissions to meet the targets and “return to the necessary reduction pathway to meet those targets.” For sellers with over $1 billion in revenue, specifies that they are in not in compliance with this requirement if the absolute GHG emissions reported increases in five consecutive years.
5. Grants DTSC jurisdiction over a seller’s compliance with ensuring that the seller’s covered products do not contain any regulated chemicals above the thresholds established by the bill.
6. Grants ARB jurisdiction over a seller’s environmental due diligence under the bill pertaining to GHG emissions.
7. Authorizes DTSC and ARB to promulgate regulations necessary or appropriate to carry out the purposes of the bill under their respective jurisdiction.
8. Requires DTSC and ARB to develop an application process for accrediting entities to act as independent verifiers, as specified.
9. Requires sellers to carry out “effective due diligence,” consistent with the bill’s requirements, for the portions of their business relating to covered products, including those produced as private label. Specifies that environmental due diligence includes a seller taking a risk-based approach and implementing good faith efforts to map suppliers, as follows:
   1. No later than January 1, 2027, disclose Tier 1 suppliers, including at least 80% of suppliers by volume;
   2. No later than January 1, 2028, disclose Tier 2 suppliers, including at least 75% of suppliers by volume;
   3. No later than January 1, 2030, disclose Tier 3 suppliers, including at least 50% of suppliers by volume; and,
   4. No later than January 1, 2032, disclose Tier 4 suppliers, including at least 50% of suppliers by volume.
10. Requires sellers, in carrying out their environmental due diligence, to comply with the environmental guidelines of the Organisation for Economic Co-operation and Development’s (OECD) Guidelines for Multinational Enterprises on Responsible Business Conduct and OECD’s Due Diligence Guidance for Responsible Supply Chains in the Garment and Footwear Sector that require a seller to, at a minimum:
    1. Embed responsible business conduct in the seller’s policies and management systems;
    2. Identify areas of significant risks of societal and ecological harm from its activities and its supply chair relationships;
    3. Identify, prioritize, and assess the significant potential and actual adverse impacts of those risks; and,
    4. Cease, prevent, or mitigate those risks, including:
       1. Taking actions specified by the bill;
       2. Using responsible exit or disengagement strategies;
       3. Consulting and engaging with impacted and potentially impacted stakeholders and rights holders and their representatives;
       4. Tracking the implementation of activities to cease, prevent, and mitigate risks and the result of those activities; and,
       5. Provision for, and cooperating in, the remediation of adverse environmental impacts resulting from the seller’s, or its suppliers, operations.
11. On or before January 1, 2027, requires sellers to ensure that their covered products do not contain any regulated chemical above specified thresholds. Authorizes the Attorney General to enforce this provision.
12. On and after January 1, 2028, prohibits the manufacture, sale, or distribution in commerce of any covered products that is sold, manufactured, or distributed by a seller that contains any regulated chemicals above specified thresholds. Authorizes the Attorney General to enforce this provision.
13. Authorizes the Attorney General to enforce the requirements of the bill.
14. Specifies that a violation of the bill is punishable by an administrative penalty of up to $5,000 for a first violation and up to $10,000 for each subsequent violation. Authorizes the use of the Toxic Substances Control Account to implement the bill, upon appropriation by the Legislature.
15. Beginning July 1, 2027, and annually thereafter, requires a seller to develop and submit to DTSC and ARB an Environmental Due Diligence Report (Report) pertaining to the environmental due diligence performed by the fashion seller for the prior calendar year, as specified, and requires the Report to be posted on the seller’s website.
16. Requires that the information specified in the Report must be independently verified before submission.
17. Requires DTSC and ARB to review the Report under their respective jurisdiction for completeness.
18. Requires DTSC and ARB, as appropriate, to identify and notify any seller that fails to comply with the reporting requirements and provide the noncompliant seller with a 30-day grace period to file a complete Report. If the seller fails to file a completed Report within the time period, requires DTSC or ARB, as appropriate, to place the seller on a publicly available list of noncompliant sellers. If the seller fails to file a complete Report within three months, authorizes DTSC or ARB, as appropriate, to take enforcement action.
19. Requires DTSC and ARB, as appropriate, to provide a notice of the noncompliance to the seller that fails to comply with the Act, and grants the seller three months from receipt of the notice to meet the requirements of the Act.
20. Establishes civil penalties of up to two percent of a seller’s annual revenues for violations enforced by ARB. Requires the penalties to be deposited into the Fashion Environmental Remediation Fund (Fund).
21. Authorizes DTSC and ARB to pursue “appropriate equitable remedies” for violations of the Act under their respective jurisdiction.
22. Requires DTSC and ARB to use a risk-based approach in enforcing the Act and to publish enforcement guidelines before the enforcement of the Act.
23. Allows individuals to report violations of the Act.
24. Establishes the Fund and specifies that moneys in the Fund are available, upon appropriation, to DTSC and ARB for purposes of implementing the Act and one or more environmental benefit projects or environmental remediation projects that directly and verifiably benefit communities impacted, to the extent feasible, at the location where the injury has occurred. Specifies that any other moneys appropriated for this purpose be deposited into the Fund.
25. Specifies that the provisions of the Act are severable.

FISCAL EFFECT: Unknown

COMMENTS:

1. Fashion. The clothing industry represents an important part of the global economy, with a value of $1.3 trillion and employing more than 300 million people. The rise of fast fashion has resulted in global fiber production nearly doubling between 2000 and 2022. People are buying more clothes than ever before, but keeping them half as long as they did two decades ago.
   
   According to the European Parliament, the textile sector was the third largest source of water degradation and land use in 2020, using nine cubic meters of water, 200 square meters of land, and 391 kilograms of raw materials to provide closing for each resident of the European Union (EU). Textile production is estimated to be responsible for approximately 20% of global clean water pollution, due to the dyeing and finishing of products. The production of clothing and textiles produced from synthetic fabrics (approximately 60%), such as nylon and polyester, releases plastic microfibers into the environment in each wash cycle. A single load of laundry can release millions of microfibers. These microfibers are the most common form of microplastics found in the environment. The European Environment Agency found that textile purchases in the EU in 2020 generated around 270 kilograms of carbon dioxide emissions per person. The World Bank determined that about 20% of industrial wastewater pollution worldwide originates from the fashion industry.
   
2. Regulating GHG emissions. AB 32 requires ARB to adopt a statewide GHG emissions limit equivalent to 1990 levels by 2020, 40% below 1990 levels by 2030, and to 85% below 1990 levels by 2045. Under their authority granted by AB 32, ARB adopted a cap and trade regulation that applies to large industrial facilities and electricity generators that emit more than 25,000 metric tons of carbon dioxide equivalent per year, as well as distributors of fuels, including gasoline, diesel, and natural gas.
   
   In addition to the cap-and-trade program, ARB developed a Scoping Plan that establishes California’s strategy for meeting the GHG emissions reduction goals. The Scoping Plan must be updated every five years. In December 2008, the ARB approved the initial Scoping Plan, which included a suite of measures to sharply cut GHG emissions. In May 2014, ARB approved the First Update to the Climate Change Scoping Plan, which builds upon the initial Scoping Plan with new strategies and recommendations.
   
   Reductions in GHG emissions will come from virtually all sectors of the economy and will be accomplished from a combination of policies, planning, direct regulations, market approaches, incentives and voluntary efforts. These efforts target GHG emission reductions from cars and trucks, electricity production, fuels, and other sources. Under the Scoping Plan, GHG emissions reduction measures apply to California’s major economic sectors, including transportation, electricity and natural gas, water, green buildings, industry, recycling and waste management, forests, high global warming potential gases, and agriculture.
   
3. Reporting GHG emissions. Under AB 32, the Mandatory Reporting of Greenhouse Gas Emissions regulation (MRR) requires hundreds of businesses, including electricity generators, industrial facilities, fuel suppliers, and electricity importers, to report GHGs to ARB. A summary of reported GHG emissions data reported under MRR is made public each year. ARB implements and oversees a third-party verification program to support mandatory GHG reporting. All GHG reports subject to the Cap-and-Trade Program must be independently verified by ARB-accredited verification bodies and verifiers.
   

The “Scope” framework was created in 2001 by the World Resources Institute and World Business Council for Sustainable Development as part of their Greenhouse Gas Protocol Corporate Accounting and Reporting Standard. The goal was to create a universal method for companies to measure and report the GHG emissions associated with their business. The three Scopes allow companies to differentiate between the emissions they emit directly into the air, which they have the most control over, and the emissions they contribute to indirectly.

Scope 1 covers all direct GHGs that stem from sources that a reporting entity owns or directly controls, regardless of location, including, but not limited to, fuel combustion activities.

Scope 2 covers indirect GHGs from consumed electricity, steam, heating, or cooling purchased or acquired by a reporting entity, regardless of location.

Scope 3 includes all other indirect emissions that occur in a company’s value chain, such as purchased goods and services, business travel, employee commuting, waste disposal, use of sold products, transportation and distribution (up- and downstream), investments, and leased assets and franchises.

Scope 1 and 2 emissions alone have shortcomings. First, Scope 1 and 2 emission sums can be manipulated. For example, a company that was once vertically integrated can procure materials from outside suppliers. Thus, the emissions produced during the making of an input material could be moved off the company’s balance sheets and excluded from measurement. This would hide the true amount of carbon emitted throughout the organization’s value chain and thwart the asset owner’s efforts to estimate climate risk. In addition, Scope 1 and 2 emissions are under-inclusive. These deficiencies can be addressed through the inclusion of Scope 3 emissions.

Recent research from CDP (formerly the Carbon Disclosure Project) found that Scope 3 supply chain emissions are on average 11.4 times greater than operational (Scope 1 and 2) emissions, which is more than double the previous estimate.

In 2023, the Legislature adopted the Climate Corporate Data Accountability Act [SB 253 (Wiener), Chapter 382, Statutes of 2023], which requires entities formed under the laws of California, the laws of any other state of the United States or the District of Columbia, or under an act of the Congress of the United States, with total annual revenues in excess of $1 billion that do business in California (reporting entities) to annually report all of their Scope 1, Scope 2, and Scope 3 emissions, as specified. SB 253 is intended to promote transparency from companies regarding their Scope 1, Scope 2, and Scope 3 emissions. ARB is required to promulgate regulations to implement SB 253, including establishing a date in 2026 when the first emission reports will be due. The first reports will cover Scope 1 and Scope 2 emissions during the reporting entity’s prior fiscal year. Beginning 2027, SB 253 requires reporting entities to begin disclosing Scope 3 emissions. SB 253 requires the reporting to conform to the Greenhouse Gas Protocol standards and guidance, including the Greenhouse Gas Protocol Corporate Accounting and Reporting Standard and the Greenhouse Gas Protocol Corporate Value Chain (Scope 3) Accounting and Reporting Standard developed by the World Resources Institute and the World Business Council for Sustainable Development.

There are layers of international standards that impact many of the companies that would be covered by this bill. The International Sustainability Standards Board (ISSB), an independent, private-sector body, developed the IFRS Sustainability Standards that are topic-specific and require an entity to disclose certain information in respects to climate-related risks and opportunities and will result in a comprehensive global baseline of sustainability disclosures. These were developed in response to a strong desire to address a fragmented landscape of voluntary, sustainability-related standards and requirements that add cost, complexity and risk to both companies and investors.

The EU recently began requiring companies to track emissions and requires them to report those emissions beginning this year under the European Climate Pact. The EU’s GHG Protocol is intended to be a comprehensive global standardized framework for measuring and managing GHG emissions, including public and private sector, value chains, and mitigation actions. The GHG Protocol includes standards for corporate inventories, corporate value chain inventories, local government inventories, establishing mitigation goals, policy and action guidance, product standards, and project protocols. The EU Protocol differs in several ways from the requirements of this bill, which may make compliance with this bill more challenging for sellers. Should this bill move forward, the author may wish to work with stakeholders to ensure that the requirements of this bill align with other state, federal, and international standards.

1. Chemical product regulation in California. In 2008, the California legislature recognized the principle of Green Chemistry by enacting two landmark pieces of legislation, AB 1879 (Feuer and Huffman, Chapter 559, Statutes of 2008) and SB 509 (Simitian, Chapter 560, Statutes of 2008). These bills lay the statutory foundation for the state's Green Chemistry program and intend to establish a comprehensive approach to chemicals policy.

The structure for regulatory action required by the Green Chemistry legislation is broad and general. Rather than specifying particular chemicals or explicit regulatory action on those chemicals, the statutes authorize state agencies, primarily DTSC, to set up a process to identify and evaluate chemicals of concern and the products in which they are found, and to impose appropriate regulatory action for those chemicals and products in order to protect people and the environment.

1. This bill. AB 405 is intended to reduce the negative environmental and public health impacts of the fashion industry by mandating fashion sellers report their supply chains, requiring companies to be responsible for their impact in those supply chains, through an environmental due diligence framework, directing companies to set and achieve climate reductions, and requiring companies to work with their suppliers to reduce the use of toxic chemicals.
   
   This bill requires seller GHG emissions to be inventoried in a manner that conforms to the accounting and reporting requirements of the Greenhouse Gas Protocol Corporate Accounting and Reporting Standards, the Scope 2 Guidance, and the Corporate Value Chain (Scope 3) Accounting and Reporting Standard promulgated by the World Resources Institute and the World Business Council for Sustainable Development. This protocol, developed by the Greenhouse Gas Protocol Initiative, is a multi-stakeholder partnership of businesses, non-governmental organizations, and others convened by the World Resources Institute, based in the US, and the World Business Council for Sustainable Development, based in Geneva. The goal of the organization is to develop internationally accepted GHG accounting and reporting standards for businesses and to promote broad adoption of the standards.
   
   Additionally, this bill requires sellers to establish targets for GHG emissions reductions in a manner that align with, at a minimum, target validation criteria promulgated by the Science Based Targets Initiative, a partnership of the United Nations Global Compact, the World Resources Institute, CDP, and the World Wide Fund for Nature. The Science Based Targets Initiative is a United Kingdom-based charity that describes itself as a corporate climate action organization that develops standards, tools, and guidance that allow companies to set GHG emissions reduction targets.
   
2. Author’s statement:

Fast fashion has fueled a global crisis. We cannot stand by while companies profit from depleting natural resources, and using toxic chemicals that pollute and harm our environment and people. The Fashion Environmental Accountability Act will hold them accountable. With California at the forefront of environmental leadership, it is critical that we take action to address the unchecked impact of fast fashion.

By mandating transparency, this bill will push the industry to adopt more sustainable practices and reduce the harmful effects of fast fashion on our environment and our health. The time for change is now. Fast fashion can no longer thrive at the expense of our environment and the health of our future generations.

1. Double referral. This bill was passed by the Environmental Safety and Toxic Materials Committee on April 8 with a vote of 5-2.
2. Suggested amendments.
   1. Penalties under this bill are based on a percentage of the revenues of the company in violation of the Act. While this may tailor the amount of the penalty to the size of the company, it may result in very high penalties for violations. Moreover, this structure may be difficult for DTSC or ARB to implement, given the fluctuations in revenue from year to year. In contrast, the penalties for violations of SB 253 are capped at a maximum of $500,000 per reporting year. The committee may wish to amend the bill to structure the penalties to be consistent with similar statutes by authorizing civil penalties of up to $10,000 for a first violation and $50,000 for subsequent violations.
   2. This bill establishes a reporting protocol based on the Greenhouse Gas Protocol Corporate Accounting and Reporting Standards, the Scope 2 Guidance, and the Corporate Value Chain (Scope 3) Accounting and Reporting Standard for GHG emissions as part of the Environmental Due Diligence Report. This protocol does not align with existing GHG reporting systems enacted by the Legislature. The committee may wish to amend the bill to require GHG emissions reporting to use the reporting system developed under SB 253.
   3. The committee may wish to make related technical and clarifying amendments to the bill.

REGISTERED SUPPORT / OPPOSITION:

Support

Alliance of Nurses for Healthy Environments

Asian American Student Association, Stanford University

Association for Farmers Rights Defense

Blue Ocean Warriors

Breast Cancer Prevention Partners

CA College and High School Students

California Climate Reality Coalition

California Environmental Voters

California Public Interest Research Group (CALPIRG) Students

Californians Against Waste

Cardinal Policy Group, Stanford University

Changing Markets Foundation

Clean Earth 4 Kids

Community Action Against Plastic Waste

Communitymade

Consumer Federation of California

Dayenu Circle of Jewish Silicon Valley

Defend Our Health

Ecofashion Corp

Eileen Fisher

Faherty Brand

Fashion Revolution CIC

Fast At Cal Fashion Club

Flap Happy

Global Uprising (dba Cotopaxi)

Heirs to Our Oceans

Indigenous Designs Corporation

Indivisible Marin

Lymi, INC. (dba Reformation)

MapxGuild

MRImpact Consulting

Patagonia INC

Plastic Pollution Coalition

Project Ropa

Ray Brown's Talking Birds

San Diego Physicians for Clean Air

Save the Albatross Coalition

Shark Stewards

Sierra Club

Students for a Sustainable Stanford, Stanford University

Surfrider Foundation

Surfrider, UC Berkeley

Sustainable Fashion Program, California State University, Northridge

The Climate Center

The Design Kids, Stanford University

The Fashion Network Association, San Francisco State University

The Last Plastic Straw

UC Berkeley Eco Office of Student Government

University of San Diego Social Justice Club

Unravel At UCLA

Unspun

Zero Waste Club, UC Davis

Zero Waste San Diego

9 Climate and health advocates

91 Individuals

Opposition

American Apparel & Footwear Association

California Chamber of Commerce

California Retailers Association

Center for Baby and Adult Hygiene Products

Analysis Prepared by: Elizabeth MacMillan / NAT. RES. /

Date of Hearing: April 8, 2025

ASSEMBLY COMMITTEE ON ENVIRONMENTAL SAFETY AND TOXIC MATERIALS

Damon Connolly, Chair

ABPCA Bill Id:AB 405 (

Author:Addis) – As Introduced Ver:February 4, 2025

SUBJECT: Fashion Environmental Accountability Act of 2025

SUMMARY: Creates the Fashion Environmental Accountability Act of 2025 and requires fashion sellers, as defined, to carry out effective environmental due diligence. Specifically, this bill:

1) Defines "environmental due diligence" as the comprehensive process companies shall carry out to identify, cease, prevent, mitigate, account for, and remediate actual and potential adverse impacts to the environment in their own operations and in their supply chain, in compliance with, at a minimum, the standards outlined in the most recent Organisation for Economic Co-operation and Development Guidelines for Multinational Enterprises, and the most recent Organisation for Economic Co-operation and Development Due Diligence Guidance for Responsible Supply Chains in the Garment and Footwear Sector.

2) Defines "Environmental Due Diligence Report" as a document prepared by a fashion seller to communicate all relevant information concerning the existence, implementation, and outcomes of due diligence in order to comply with the requirements of this bill, and to comply with any rules or regulations established pursuant to this bill.

3) Defines "Fashion bag" as flexible packaging made of textiles, leather or other animal products, woven material, or other similar materials intended for repeated use, including, when applicable, those produced as a private label.

4) Defines "Fashion goods" as wearing apparel, footwear, or fashion bags.

5) Defines "Fashion seller" as a business entity that does business in the state involving the sale of fashion goods in excess of $100,000,000 in annual gross receipts. "Fashion seller" does not include fashion sellers that sell used fashion goods and does not include multibrand retailers, unless the total annual gross receipts of all of the private labels under the retailer exceeds $100,000,000.

6) Defines "Footwear" as any covering worn or intended to be worn on the foot, including, when applicable, those produced as a private label.

7) Defines "Gross receipts" as the gross amounts realized on the sale or exchange of property, the performance of services, or the use of property or capital, including rents, royalties, interest, and dividends, in a transaction that produces business income. Provides that amounts realized shall not be reduced by the cost of goods sold or the basis of property sold.

8) Provides that the Department of Toxic Substances Control (DTSC) shall have jurisdiction over a fashion seller’s environmental due diligence under this bill pertaining to chemical management and wastewater testing.

9) Provides that the State Air Resources Board (ARB) shall have jurisdiction over a fashion seller’s environmental due diligence under this bill pertaining to emissions of greenhouse gases.

10) Provides that DTSC and the ARB, as appropriate, may, separately or jointly, prescribe regulations necessary or appropriate to carry out the purposes of this bill under their respective jurisdiction.

11) Requires every fashion seller to carry out effective environmental due diligence for the portions of their business related to fashion goods, including, but not limited to, those items produced as a private label.

12) Requires, by January 1, 2028, in accordance with internationally recognized methodologies for chemical management and wastewater testing, a fashion seller to require all of its significant tier 2 dyeing, finishing, printing, and garment washing suppliers to do all of the following:

(a) Sample and annually report to the fashion seller on wastewater chemical concentrations and water usage;

(b) Report on chemical inventory; and,

(c) Provide evidence that the supplier is in compliance with local chemical management laws.

13) Provides that a fashion seller who violates this bill shall be subject to a civil penalty of up to 2 percent of its annual revenues.

14) Authorizes DTSC or ARB, as appropriate, to seek any appropriate equitable remedies for a violation of this bill under their respective jurisdiction.

15) Provides that the provisions of this bill are severable. If any provision of this bill or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.

EXISTING LAW:

1) Establishes the Resource Conservation and Recovery Act (RCRA) to authorize the United States Environmental Protection Agency to manage hazardous and non-hazardous waste throughout its life-cycle. (42 United State Code § 6901 et. seq.)

2) Requires DTSC to adopt regulations to establish a process to identify and prioritize chemicals or chemical ingredients in consumer products that may be considered chemicals of concern, as specified. (HSC § 25252)

3) Requires DTSC to adopt regulations to establish a process to evaluate chemicals of concern in consumer products, and their potential alternatives, to determine how to best limit exposure or to reduce the level of hazard posed by a chemical of concern. (HSC § 25253 (a))

4) Specifies, but does not limit, regulatory responses that DTSC can take following the completion of an alternatives analysis, ranging from no action, to a prohibition of the chemical in the product. (HSC § 25253)

5) Prohibits, on and after June 1, 2006, a person from manufacturing, processing, or distributing in commerce a product, or a flame-retarded part of a product, containing more than one-tenth of 1 percent of pentaBDE or octaBDE. (HSC § 108922)

6) Prohibits, beginning January 1, 2025, a person from manufacturing, distributing, selling, or offering for sale in the state a new textile article, as defined, that contains regulated perfluoroalkyl and polyfluoroalkyl substances (PFAS). (HSC § 108970)

FISCAL EFFECT: Unknown.

COMMENTS:

Need for the bill: According to the author, "Fast fashion has fueled a global crisis. We cannot stand by while companies profit from depleting natural resources, and using toxic chemicals that pollute and harm our environment and people. The Fashion Environmental Accountability Act will hold them accountable. With California at the forefront of environmental leadership, it is critical that we take action to address the unchecked impact of fast fashion.

By mandating transparency, this bill will push the industry to adopt more sustainable practices and reduce the harmful effects of fashion on our environment and our health. The time for change is now. Fast fashion can no longer thrive at the expense of our environment and the health of our future generations."

Chemical product regulation in California: In 2008, the California legislature recognized the principle of Green Chemistry by enacting two landmark pieces of legislation, AB 1879 (Feuer and Huffman, Chapter 559, Statutes of 2008) and SB 509 (Simitian, Chapter 560, Statutes of 2008). These bills lay the statutory foundation for the state's Green Chemistry program and intend to establish a comprehensive approach to chemicals policy.

The structure for regulatory action required by the Green Chemistry legislation is broad and general. Rather than specifying particular chemicals or explicit regulatory action on those chemicals, the statutes authorize state agencies, primarily DTSC, to set up a process to identify and evaluate chemicals of concern and the products in which they are found, and to impose appropriate regulatory action for those chemicals and products in order to protect people and the environment.

The Safer Consumer Products regulatory process: To implement the Green Chemistry statutes, DTSC created what it called a "four-step continuous, science-based, iterative" regulatory process, which it deemed the "Safer Consumer Products" (SCP) regulations. The SCP regulations were adopted October 2013, and include the following: establish a list of "candidate chemicals" based on the work already done by other authoritative organizations, and specify a process for DTSC to identify additional chemicals as candidate chemicals; require DTSC to evaluate and prioritize product/candidate chemical combinations to develop a list of "priority products" for which alternatives analyses must be conducted; require responsible entities (manufacturers, importers, assemblers, and retailers) to notify DTSC when their product is listed as a priority product and then perform an alternatives analysis for the product; and, require DTSC to identify and implement regulatory responses designed to protect public health and/or the environment, and maximize the use of acceptable and feasible alternatives of least concern.

Since the adoption of the Safer Consumer Products regulation in 2013, DTSC has adopted 8 priority products and there is currently one proposed priority product. One of the priority products adopted by DTSC covered certain converted textiles. On April 1, 2022, DTSC finalized a regulation pursuant to the SCP regulations adding as a priority product: treatments containing PFASs for use on converted textiles or leathers such as carpets, upholstery, clothing, and shoes.

Chemicals in textiles: According to the article, "Chemicals in Textiles and the Health Implications", in Allergy Standards, written by Dr. Tim Yeomans:

"We are constantly in contact with textiles in our environment and so safety and confidence in these products is vital. Textiles comprise a significant part of our consumer world: clothing, bedding, furnishings, carpeting, towels, car interiors and so on, are all made from textiles. They can be made of natural or synthetic fibres but any allergic reactions or health implications are generally as a response to fibre treatments, such as dyeing and other chemical finishes, rather than the textile itself.

Natural textiles can include material such as wool, flax, silk, cotton, bamboo and hemp and synthetic includes such materials as acrylic, nylon, rayon, spandex and polyester. Chemical finishes to textiles can greatly improve their wearability, appearance and functionality, and a great many functional chemical finishes we simply take for granted.

Chemical finishes can be durable or non-durable and different chemicals will bind at different strengths to different fibres.

Formaldehyde is a Volatile Organic Compound (VOC), meaning that it can be released into the atmosphere. It is predominantly used in fabrics to prevent wrinkling, but can also be used for water-proofing and to promote color fastness. In larger quantities, formaldehyde can cause respiratory problems and skin irritation; it may cause exacerbation of asthma or cause allergic contact dermatitis. For these reasons there are limits to the amount of formaldehyde allowed in consumer products.  In the 1960s formaldehyde levels could be as high as 3,000ppm, this had declined to below 500ppm in the 1980s and in general most clothing now has relatively low levels of formaldehyde. Where price and quality continue to be a pressure on the textile industry however, it can be possible for lower quality material to enter the supply chain 

Azo dyes are found in 60-80% of all colorants and are responsible for the vivid colours that can be seen in many textiles, especially clothing. Azo dyes can quite easily come off fabrics and can break down to release chemicals called aromatic amines, some of which have been reported to cause cancer. Some dyes can also cause contact dermatitis, the most common of which being disperse blue 106 and disperse blue 124. In 2003 the EU [European Union] banned azo dyes that could release one or more of the 22 most dangerous aromatic amines;

Heavy metals are often used as part of the dyeing process and include antimony, cadmium, lead, mercury and chromium VI. Once absorbed by the body, these metals can accumulate in the liver or kidney and cause serious health problems. Cadmium, lead and chromium IV are classified as carcinogens, with cadmium being restricted in Europe for some time. The use of mercury and lead has been restricted in textiles, however they are still of concern.

The chemicals listed above are some of the more common chemicals used in textiles, however there are many more used for other functions including plasticity, water resistance, flame retardancy and so on. In this context, with the amount of chemicals that can be used, the limit levels that may change from country to country and even within a country, it can be very challenging for manufacturers to keep up.  Globalisation provides companies and consumers with many opportunities through enhanced choices, but with it brings many challenges. Manufacturers can source textiles from anywhere in the world, which has many benefits, but also raises many questions. 

There is also an element of corporate social responsibility; while some chemicals may not be banned, it may be more appropriate to use more environmentally friendly alternatives – how can companies be sure that their suppliers are complying with this? Once incorporated into the fabric it can be almost impossible to tell what chemical has been used and how much (unless destructive testing is performed)."

Legislation banning/restricting chemicals in products: Over the past twenty years the legislature has enacted a variety of product safety related legislation dealing with flame retardant chemicals, phthalates in products for young children, bisphenol A, and several other chemical/product combinations. Below is a summary of a few of these laws:

Polybrominated Diphenyl Ethers: AB 302 (Chan, Chapter 205, Statutes of 2003) prohibits a person from manufacturing, processing, or distributing in commerce a product, or a flame-retarded part of a product, containing more than 0.1% pentaBDE or octaBDE on and after January 1, 2008. An early version of this bill required the California Environmental Protection Agency to develop regulations; however, that was amended out of the bill - the bill was subsequently keyed non-fiscal and not heard in the Appropriations Committees.

Phthalates in products for young children: AB 1108 (Ma, Chapter 672, Statutes of 2007). Prohibits the use of phthalates in toys and childcare products designed for babies and children under three years of age. Requires manufacturers to use the least toxic alternative when replacing phthalates.

Product safety: bisphenol A: AB 1319 (Butler, Chapter 467, Statutes of 2011) Prohibits the sale, manufacture, or distribution of a bottle or cup or a liquid, food or beverage in a can, jar or plastic bottle that contains bisphenol A (BPA) if the item is primarily intended for children three years of age or younger. Requires manufacturers to use the least toxic alternative when replacing bisphenol A in containers. The bill provides that if DTSC adopts a regulatory response regarding the use of bisphenol A in a product that is prohibited by this bill, then this law shall not apply to that product.

Product safety: textile articles: perfluoroalkyl and polyfluoroalkyl substances (PFAS): AB 1817 (Ting, Chapter 762, Statutes of 2022). Prohibits, beginning January 1, 2025, a person from manufacturing, distributing, selling, or offering for sale in the state a new textile article, as defined, that contains regulated PFAS. This law defines regulated PFAS as: PFAS that a manufacturer has intentionally added to a product and that has a functional or technical effect in the product, or the presence of PFAS in a product or product component at or above the following thresholds, as measured in total organic fluorine: commencing January 1, 2025, 100 parts per million; commencing January 1, 2027, 50 parts per million.

Product safety: bisphenol. SB 1266 (Limon, Chapter 790, Statutes of 2024). Updates AB 1319 (Butler) by prohibiting , beginning January 1, 2026, a person from manufacturing, selling, or distributing in commerce any juvenile’s feeding product, juvenile’s sucking product, or juvenile’s teething product, as defined, that contains any form of bisphenol, as defined, at a detectable level above 0.1 parts per billion. Additionally, SB 1266 authorizes DTSC to enforce the provisions of this bill.

The author may wish to consider a similar approach to the above bills, prohibiting or restricting certain chemicals in fashion products.

This bill: AB 405 is designed to reduce toxic chemicals used in the production of fashion products, including both the manufacturing of the product as well as toxic chemicals in the finished product sold to the consumer. Additionally this bill looks at reduce greenhouse gases from the production of fashion products, which will be debated in the Assembly Natural Resources Committee should this bill pass this Committee in its current form.

Potential amendments to address chemicals in fashion: Looking at recent legislation that prohibits or restricts various chemicals in products, the author and Committee may wish to amend AB 405 to restrict certain chemicals in covered fashion products. Specifically, the author may wish to amend the bill to restrict the following chemicals in covered fashion products: azo-amines & arylamine salts; bisphenals; flame retardants; formaldehyde; phthalates; and, lead.

Additionally, the author may wish to clarify DTSC's regulatory role in the bill, similar to DTSC's role in regulating bisphenols in juvenile products statutes enacted under SB 1266 (Limon, Chapter 790, Statutes of 2024).

Arguments in support: According to the Center for Environmental Health:

"The $2.5 trillion fashion industry is unregulated. At a minimum, the fashion industry emits more than 2.1 gigatons of greenhouse gases every year. Given growth expectations, the industry is on a path to generate 2.7 gigatons by 2030.

Foreign fast fashion brands continue to engage in highly exploitative practices that yield over 100 billion garments a year, over 80% of which end up in landfill after one wash or wear. For example, Shein more than doubled its revenue ($24 to $60 billion), its profits ($2 billion in profits in 2024) and its carbon emissions last year alone. If its greenhouse gas intensity stays on the same growth trajectory, its 2025 emissions will surpass those of British Airways in 2019.

Collectively, the fashion industry’s global carbon emissions are on par with the global aviation industry. Fashion is dirty business, top to bottom.

• Clothing manufacturers use over 8,000 toxic chemicals to manufacture clothing.
• These toxic chemicals pollute our water and air during manufacturing; remain on clothes, harming consumers while they wear them; contaminate our water after washing them, including through the release of microplastics (80% of our ocean’s microplastics come from clothing); and pollute our air and groundwater after landfill disposal.
• EU and South Korea reported that a random sampling of Temu’s children’s clothes had 600 times the legal limit of phthalates and over three times the legal limits of lead and cadmium.
• Clothes are primarily polyester (in whole or in part), which are made from fossil fuels, the greatest source of pollution and greenhouse gases.

Without regulation, fast fashion players will continue to manufacture irresponsibly and contaminate water, misuse and improperly dispose of toxic chemicals, and create staggering amounts of waste. Fashion brands’ voluntary commitments to reduce their environmental footprint misled consumers into believing they are buying sustainably, when in reality, those are promises brands routinely break in the name of ensuring profitability."

Arguments in opposition: According to the California Retailers Association (CRA),

"At a time when we face economic uncertainty due to shifting tariffs and evolving environmental regulations, AB 405 risks overburdening an already strained system. CRA has long been a leader in collaborating with the Legislature on complex issues to develop practical, impactful solutions.

AB 405 also introduces redundant policies that will strain state resources and impose significant costs on retailers and consumers. Expanding regulatory authority for agencies such as DTSC and CARB creates unnecessary red tape, diverting resources from essential services like public safety and healthcare. At a time when California faces fiscal constraints, we cannot afford to monitor global economic behaviors or enforce duplicative regulations. Retailers are already navigating complex challenges, including tariffs and the rewriting of major environmental regulations, making this bill particularly ill-timed. Adding another layer of regulation, which AB 405 will do through CARB and DTSC, will only divert resources from ensuring these existing programs are implemented effectively. Retailers are already leaning into existing environmental initiatives; they need time to demonstrate their success before new mandates are imposed.

The California Retailers Association firmly believes environmental accountability is critical, but AB 405 does not advance meaningful solutions beyond what California has already achieved. Instead, it risks undermining current efforts by overburdening businesses and consumers with unnecessary costs while diverting attention from optimizing existing programs."

Double-referral: Should this bill pass the Assembly Environmental Safety and Toxic Materials Committee, it will be referred to the Assembly Natural Resources Committee.

Related legislation:

1) SB 1266 (Limon, Chapter 790, Statutes of 2024). Prohibits, beginning January 1, 2026, a person from manufacturing, selling, or distributing in commerce, any juvenile’s feeding product, juvenile’s sucking product, or juvenile’s teething product, as defined, that contains any form of bisphenol, as defined, at a detectable level above 0.1 parts per billion. Additionally, SB 1266 authorizes DTSC to enforce the provisions of this bill.

2) AB 1817 (Ting, Chapter 762, Statutes of 2022). Prohibits, beginning January 1, 2025, any person from manufacturing, distributing, selling, or offering for sale in the state any new, not previously owned, textile articles that contain regulated PFAS, except as specified.

REGISTERED SUPPORT / OPPOSITION:

Support

Alliance of Nurses for Healthy Environments
Association for Farmers Rights Defense
Blue Ocean Warriors
Breast Cancer Prevention Partners
California Against Waste
California Climate Reality Coalition
California Environmental Voters
Cardinal Policy Group, Stanford University
Center for Environmental Health
Changing Markets Foundation
Clean Earth 4 Kids
Community Action Against Plastic Waste
COMMUNITYMADE
Consumer Federation of California
Consumer Services
Cut Consulting
Defend Our Health
Eileen Fisher
Faherty Brand
Fashion ACT
Flap Happy
Global Uprising (dba Cotopaxi)
Heirs to Our Oceans
Patagonia INC.
Plastic Pollution Coalition
Ray Brown's Talking Birds

Reformation
Rothy's
San Diego Physicians for Clean Air
Save the Albatross Coalition
Shark Stewards
Students for A Sustainable Stanford, Stanford University
Sustainable Fashion Program, California State University, Northridge
The Asian American Students' Association, Stanford University
The Climate Center
The Design Kids, Stanford University
The Fashion Network Association, San Francisco State University
The Last Plastic Straw
ThredUp
University of San Diego Social Justice Club
Unravel At UCLA
Unspun
Zero Waste San Diego

10 Individuals

Opposition

California Chamber of Commerce
California Retailers Association

Analysis Prepared by: Josh Tooker / E.S. & T.M. / (916) 319-3965