The EU Sustainable & Circular Textiles Directive

Are you prepared for the changes that lie ahead?

On March 30th, The European Commission published their Directive for Sustainable and Circular Textiles, a new blueprint that lays out key principles to drive change in the textiles industry.
Are you aware of the actions it proposes, how they will affect your brand, and what actions businesses need to take to be ready for the coming changes?

We have prepared this quick primer to get you started and advise that brands that have adopted Certilogo’s connected product platform, are already well prepared for the changes that lie ahead.

What are the goals of the directive?

The European Commission adopted the New Circular Economy Action Plan (CEAP) in 2020, as part of the European Green Deal, which set the agenda for sustainable growth. Transitioning toward a circular economy aims to reduce the use of natural resources and build economic resilience without affecting economic growth. The ultimate goal is climate neutrality by 2050.

As part of that plan, the EU Strategy for Sustainable and Circular Textiles sets out a vision that by 2030 textile products entering the EU market must be long-lasting, repairable, and recyclable, made primarily of recycled fibers, free of harmful substances, and produced ethically in respect of social rights and the environment.

Fast fashion will be out-of-fashion, replaced with high-quality products, delivered via new circular business models, and economically profitable re-use, rental, and repair services that extend product life, should be widely available.

Producers will have to take responsibility for their products along the value chain, reducing overproduction and overconsumption, and adopting innovative fiber-to-fiber recycling, while the incineration and landfilling of textiles have to be reduced to the minimum.

Why is it necessary?

The textile industry ranks fourth for the consumption of raw materials and water and is responsible for 10% of the global greenhouse gas emissions - more than the total of all international flights and shipping combined.

It's responsible for 20% of the world's water pollution, while synthetic clothing accounts for 35% of the microplastics released into the environment. Microfibers cannot be extracted from the water and spread throughout the food chain. Each of us ingests an estimated 5 grams of plastic per week.

Not to mention the huge problem of waste. Every year, the industry produces about 100 billion garments. Citizens throw away 11 kg of textile products every year, but only 1% are recycled, while 87% end up in landfills, abandoned or incinerated.

Poisoned rivers, polluted soils, reduced soil fertility, biodiversity loss, and climate change. Increased health risks, slavery and child labor, and destruction of local economies are all consequences the industry must seek to avoid.

The consumption of clothing and footwear is projected to increase by 63% by 2030, and in this context, it is clear why textiles are one of the products on which the New Circular Economy Action Plan focuses most.

What changes will it bring?

• Circular Design Approach

Design requirements to make products last longer, and easier to repair or recycle. Designed for circularity with standards to set a minimum content of recycled fibers, and demanding raw materials are free of hazardous chemicals.

• New Manufacturing Procedures

New processes such as pre-washing by manufacturing plants will address the unintended release of micro-plastics and other harmful substances.

• Digital Product Passports

Clearer and more transparent information on textiles will tackle greenwashing, raise awareness about sustainable fashion, and will provide businesses and citizens the opportunity to choose sustainable textile products consciously.

• Extended Producer Responsibility

Environmental guidelines and levies will hold manufacturers, importers, and retailers responsible for the entire life cycle of their products. Ensuring the traceability of the lifecycle to end of life waste processing, and reversing overproduction and overconsumption.

• Circular Business Incentives

Economic incentives will favor circular materials, production processes and business models, transparency, separate collection, and international cooperation.

• Restricted Waste Disposal

Bans on the destruction of unsold, returned and used products, while the export of textile waste will be restricted. Adoption of new legislation and technology to help tackle the issue of counterfeit products.

The final section of this newsletter focuses on the action that is central to the strategy, the Digital Product Passport. Read the full article - For further information on the five other principle actions.

The Digital Product Passport

By the end of 2022, the EU will publish its action plan for the players in the textiles ecosystem to successfully achieve green and digital transitions. At the heart of the strategy, and a key enabler of the strategy’s actions is the Digital Product Passport.

The Digital Product Passport (DPP) is a digital certificate that contains all information about a product and its supply chain, from the raw materials used, and the processes employed throughout production, to how it can be disposed of at the end of its existence. It is designed to be accessible and communicated throughout the value chain, including with consumers so that everyone has a greater awareness of the resources and products they use, as well as their environmental impact.
Each product is provided with its own unique identifier which can be used to access the contents of its digital product passport, as well as used to trace the product as it continues its lifecycle.

From 2026, every industrial and electric vehicle battery must come with a digital product passport. Fashion and textiles are already identified as one of the next product categories that will require Digital Product Passports, and guidelines are expected later in 2022 and legislation introduced by 2024.

The key use cases for Digital Product Passports

• Traceability

Without traceability, there can be no sustainability.
In order to understand and reduce the impact of their products, as well as maintain the trust of the consumer, brands must be able to document the sustainability profile of their own materials and processes, as well as that of every supplier, raw material, and process that has been involved in creating the final product.
Traceability does not stop at the production of the product but includes an understanding of where, how, and to whom products are being sold, and what happens to the product at the end of its useful life.
Better traceability data will provide businesses with valuable insights to improve their business performance, enabling the optimization of product planning and distribution, to deliver increased sell-through conversion rates, resulting in less unsold stock. Brands will reduce their environmental impact while improving their business performance.

• Trusted transparency

Products can be marketed with trustworthy and quantifiable sustainability claims that are easily accessible to the end consumer, enabling them to make more informed purchasing decisions - by providing them with information on the total impact of their buying behaviors.
Connecting the eco-system of actors involved across the product lifecycle and providing them access to this data, will present significant opportunities to innovate, compete and accelerate the sustainability transition of the supply chain.

• Protection against counterfeits

Counterfeit products damage a brand's value, causing lost revenue from stolen sales, and eroded trust among consumers, but will also be more harmful to the environment than authentic products, which meet new design and production standards. Consumers will want to ensure their investment in a sustainable product is not in vain.
The Digital Product Passport is a tool that enables consumers to authenticate and identify fakes pre-purchase while helping brands to easily identify illegal retailers and make it increasingly difficult for them to operate. With up to 30% of fashion purchases being fake products, brands will be expected to take responsibility for reducing the impact of their own products, and that caused by fakes.

• Circularity Business Models

Thanks to the improved access to data with digital product passports, more businesses will be able to create new value through circular business models, such as rental and repair-based services.
It will be easier for consumers to re-sell certified authentic garments, extending a product’s useful life, and reducing the costs to brands of collecting and sorting products for recycling and reuse. As business models become more circular, this can also diversify material sourcing options and strengthen supply chain security within businesses. 

• Connection to digital experiences

Brands can integrate their products into the omnichannel consumer journey, throughout the entire lifecycle of the product, and create highly engaging experiences, by taking advantage of the ability to personalize content right down to the individual product level. Delivering rich storytelling, compelling recommendations, and access to premium services that differentiate, convert consideration into sales and allow brands to build stronger relationships with their consumers.

The Certilogo Connector

Certilogo clients benefit from a connected product platform and consumer experience web app that is already equipped to deliver the most effective Digital Product Passport key use cases.

What’s more, Certilogo’s award-winning, A.I.-powered product authentication provides class-leading functionality that underpins the Digital Product Passport use cases. From building trust in the purchase, enabling new revenue models, to ensuring brands are not exposed to the risk of being responsible for products they did not introduce into the market.

Brands that are deploying Digital Product Passport strategies today, will gain an advantage over their competitors.
Providing trustworthy sustainability claims and moving to circular-oriented innovation strategies via digital product passports, creates an opportunity for companies to generate new value and capture a greater market share.

Moving now will position businesses in a leadership position when digital product passports become a legal requirement over the next few years.

Contact Us - Let’s start a conversation on how Certilogo can help your brand grow your business while reducing its environmental impact.