What Fashion Brands Must Comply With in 2026 — DPP, CSRD, EPR, and What It Means for Your Sourcing

2026 is the year sustainability compliance stopped being optional. Across the EU and the United States, a wave of regulations that were announced, delayed, and revised over the past three years are now actively coming into force — and fashion brands that have not prepared are facing real operational and financial consequences.

This is not another article about sustainability trends. This is a practical breakdown of the specific regulations that are live or activating right now in 2026, what they require from your brand, and — critically — how your choice of manufacturing partner affects your ability to comply.

If you source garments from Bangladesh and sell into the EU or US market, read this carefully.

2026 Compliance Snapshot: What Is Active Right Now

Here is a summary of the key regulations affecting fashion brands this year:

Source: EU Commission, California Legislature, OEKO-TEX, GOTS Foundation — March 2026

1. Digital Product Passports (DPP) — EU

The Digital Product Passport is arguably the most significant regulatory change the fashion industry has ever faced. From 2026, the EU is beginning a phased rollout requiring apparel brands to attach a verifiable digital record to each product covering:

• Material composition: exact fibre content, origin of raw materials
• Manufacturing location: factory name, address, and certification status
• Chemical use: substances used in dyeing, finishing, and treatment
• Carbon footprint: estimated GHG emissions per unit of production
• End-of-life instructions: recycling, repair, and disposal guidance

This data must be accessible via a QR code or NFC tag on the physical product — scannable by consumers, customs authorities, and regulatory bodies alike.

What this means for your sourcing: You cannot comply with DPP requirements if your manufacturer cannot give you this data. A factory that cannot tell you what chemicals it uses in dyeing, what its energy consumption is per unit, or where its yarn comes from cannot support your DPP obligations. This makes your choice of certified, transparent manufacturer a direct compliance requirement — not just a sustainability preference.

Bangladesh’s LEED-certified factories — 268 of them as of 2026 — are significantly better positioned to provide this data than conventional factories, because green building certification requires exactly this kind of operational monitoring and reporting.

2. CSRD — Corporate Sustainability Reporting Directive (EU)

The Corporate Sustainability Reporting Directive requires large companies doing business in the EU to publicly disclose their environmental and social impact. The phased timeline is:

The critical point for fashion brands is Scope 3 emissions — the indirect emissions from your supply chain, including the factories that make your garments. From 2026, large EU brands must begin tracking and disclosing these. From 2027, mid-size brands follow.

What this means for your sourcing: Your manufacturer’s energy source, production efficiency, and emissions data will directly feed into your Scope 3 reporting. A factory running on solar with real-time energy metering gives you auditable Scope 3 data. A conventional factory running on diesel generators does not. This is a sourcing decision that directly determines whether your CSRD report is credible.

3. California Compliance — SB 253 and SB 707 (USA)

California has become the de facto regulatory leader for US fashion sustainability law. Two pieces of legislation are moving into active compliance phases in 2026:

SB 253 — Climate Corporate Data Accountability Act

Applies to companies with over $1 billion in annual global revenue doing business in California. Requirements:

• 2026: Begin reporting Scope 1 and Scope 2 greenhouse gas emissions
• 2027: Add Scope 3 supply chain emissions reporting

If you are a large fashion brand or retailer selling in California, your manufacturer’s emissions performance will become a reportable figure in your public disclosures within 12 months.

SB 707 — Textile Extended Producer Responsibility

California’s textile EPR law makes apparel brands financially and operationally responsible for the end-of-life management of their products. Key deadlines:

• January 1, 2026: Producer Responsibility Organisation (PRO) must submit collection plan to the state
• July 1, 2026: Textile producers must participate in an approved PRO
• Post-approval: Progressive rollout of collection, reuse, and recycling systems

Non-compliance penalties: up to $10,000 per day. Brands selling in California that are not part of an approved PRO by mid-2026 face significant regulatory risk.

4. CSDDD — Corporate Sustainability Due Diligence Directive (EU)

The Corporate Sustainability Due Diligence Directive (CSDDD) requires large EU-based companies — and eventually non-EU companies with significant EU revenue — to identify, prevent, and address human rights and environmental risks across their entire supply chains.

The timeline runs from 2027 for the largest companies, but the preparation work must begin now. Brands that wait until 2027 to start mapping their supply chains will not be compliant on time.

What this means in practice for fashion brands:

• Tier 1 factory audit: Your direct manufacturer (e.g. Manamo Fashions) must be audited for labour and environmental compliance
• Tier 2 mapping: The fabric mill supplying your manufacturer must also be disclosed
• Tier 3 mapping: Yarn spinners and raw material origins must be traceable

Bangladesh’s established audit infrastructure — BSCI, SEDEX, and WRAP certifications are widely held — means Bangladeshi factories are among the best-prepared globally for CSDDD supply chain due diligence requirements.

What to Ask Your Manufacturer Before You Place an Order in 2026

Given these regulations, here are the specific questions every brand should be asking their garment manufacturer right now:

1. Can you provide a material traceability certificate showing yarn and fabric origin to support Digital Product Passport requirements?
2. What is your factory’s annual energy consumption per unit of production, and how much comes from renewable sources?
3. Do you hold OEKO-TEX Standard 100 certification? Which product classes, and when was it last renewed?
4. Are you GOTS certified for organic cotton production, or working toward it?
5. What chemical management standard do you follow? Do you comply with ZDHC (Zero Discharge of Hazardous Chemicals)?
6. Can you provide a factory audit report (BSCI, SEDEX, WRAP, or equivalent) from the past 12 months?
7. What is your wastewater treatment process, and do you have zero-discharge certification for wet processing?

Why a Certified Bangladeshi Manufacturer Is Your Compliance Advantage

The regulations above share a common thread: they all require data, traceability, and verified environmental performance from your manufacturer. This fundamentally changes what “a good manufacturer” means in 2026.

Price per unit is no longer the only metric. The question is now: can this factory give me the documentation I need to comply with EU and US regulations?

Bangladesh’s manufacturing sector has invested heavily in exactly this infrastructure:

• 268 LEED-certified factories with energy metering, water monitoring, and operational data systems — the most of any country in the world
• Widespread OEKO-TEX and GOTS certification covering chemical safety and organic fibre traceability
• BSCI and SEDEX social auditing providing the labour compliance documentation CSDDD will require
• Vertical integration — spinning, weaving, dyeing, and garment manufacture within Bangladesh — enabling deeper Tier 2 and Tier 3 traceability than fragmented supply chains

For brands facing DPP rollout, CSRD Scope 3 reporting, and CSDDD supply chain mapping requirements in 2026 and 2027, a certified Bangladeshi manufacturer is not just a cost-competitive choice — it is a compliance-enabling choice.

Frequently Asked Questions

What is a Digital Product Passport and when does it apply to fashion brands?

A Digital Product Passport (DPP) is a verifiable digital record of a product’s material composition, manufacturing origin, chemical content, carbon footprint, and end-of-life guidance. The EU is rolling out DPP requirements for textiles from 2026, requiring brands to make this data accessible via a QR code or NFC tag on every product sold in the EU. Brands must work with manufacturers who can provide traceable material and production data.

What is CSRD and does it apply to fashion brands?

The Corporate Sustainability Reporting Directive (CSRD) requires large companies doing business in the EU to publicly disclose their environmental and social impact. For fashion brands, this includes Scope 1 and 2 emissions reporting from 2026 and Scope 3 supply chain emissions from 2027. Brands with over 250 employees or €40M+ revenue doing business in Europe are now in scope. The supply chain manufacturing emissions of your garment factory are a core Scope 3 data requirement.

What is California’s textile EPR law and who does it affect?

California SB 707 is a textile Extended Producer Responsibility law that makes apparel brands responsible for end-of-life management of their products. Brands selling apparel in California must participate in an approved Producer Responsibility Organisation (PRO) by July 1, 2026. Non-compliance carries penalties of up to $10,000 per day. The law applies to apparel, footwear, and other consumer textile products.

How does my manufacturer choice affect CSRD Scope 3 compliance?

Your garment manufacturer’s energy consumption, renewable energy share, and production emissions are classified as Scope 3 indirect emissions under CSRD. Brands must report these from 2027. A factory with energy monitoring systems, renewable energy, and LEED certification can provide auditable Scope 3 data. A conventional factory without monitoring systems cannot support your reporting requirements.