Why current textile policy is failing to make the textile chain sustainable (Deep dive)

The high environmental pressure means there is a need for policy interventions at European and national level. Compared to other product streams, such as electrical appliances and packaging, textiles are one of the last major product groups for which additional environmental measures must be introduced.

European textile policy is therefore in full swing and must steer the sector towards a circular economy. With new strategies, directives and regulations, the European Union wants to be a world leader in the field of the circular economy in 2030, and textiles are one of the priority sectors in this regard. The Netherlands is also trying to secure a leading position in the field of textiles and wants to achieve a fully circular economy in 2050.

At the same time, actual system change remains limited. Current policy falls short in ambition and enforcement, allowing the textile industry to maintain its profitable but polluting business model and shift responsibility. That is why in this article we dive into recent developments in European and Dutch textile policy. We show how textile policy has developed and consider the biggest bottlenecks: from ambitious promises and resistance from the market, to cautious steps forward.

European textile policy

In recent decades, the European Union has introduced a number of important policy dossiers that guide the sustainability of various production chains, including the textile sector. Three policy frameworks form the strategic and legal basis within which textile policy is developed:

• European Green Deal (EGD)

• EU Climate Law (Regulation 2021/1119)

• Circular Economy Action Plan (CEAP)

Textiles have been designated as one of the priority sectors in the Circular Economy Action Plan. Therefore, the European Union is further elaborating the ambitions of the EGD and the CEAP for textiles in a number of important dossiers and instruments, including:

• The EU Strategy for Sustainable and Circular Textiles

• The Ecodesign for Sustainable Products Regulation (ESPR)

• The Circular Economy Act (CEA)

Below we go into more detail on these (ongoing) dossiers and their role within the sustainability of the textile sector.

Circular Economy Action Plan

Type: Action plan 

Status: Presented

In March 2020, the Circular Economy Action Plan (CEAP) was presented. This policy framework is aimed at scaling up the circular economy to achieve the goals of the EGD. Textiles are designated in the CEAP as one of the five priority industries.

The policy framework focuses on the following three components:

1. Sustainable design of products: The EU wants to introduce new legislation and extend the Ecodesign Directive (later replaced by ESPR – see below) to multiple product groups instead of exclusively energy-related products. In doing so, the focus is first on priority sectors, including textiles.

2. Giving a greater role to consumers and governments: The EU wants to protect consumers against greenwashing by ensuring better and fair information and guaranteeing the right to repair. In addition, governments will be obliged to purchase more sustainably, so that this becomes the new norm.

3. Circularity in products: The last pillar of the CEAP is to make the industry more circular by stimulating the reuse of raw materials through research and digital technology, and by encouraging green technology and cooperation between companies.

EU Strategy for Sustainable and Circular Textiles

Type: Strategy
Status: Presented

In March 2022, the European Union published the EU Strategy for Sustainable and Circular Textiles to further elaborate the commitments from the European Green Deal and the Circular Economy Action Plan (CEAP) specifically for textiles. The strategy sets the goal of making all textile products on the EU market more sustainable, repairable and recyclable and of having producers take more responsibility in the chain. In addition, fast fashion must be phased out. 

This strategy covers multiple directives, regulations and initiatives that the European Union has since adopted or will further elaborate in the coming years, including:

Empowering Consumers for the Green Transition

This directive was proposed on 30 March 2022 to better inform consumers about sustainability features of products, and entered into force on 27 March 2024. Generic environmental claims such as ‘eco-friendly’ may no longer be used unless a product carries an approved ecolabel (such as the EU Ecolabel). In addition, stricter requirements are set for claims about CO₂ offsetting and sellers must better inform consumers about repair options and the period during which they are available.

Green Claims Directive (proposal)

This directive, proposed on 22 March 2023, was subsequently intended to make environmental claims reliable, verifiable and comparable, in addition to the Empowering Consumers for the Green Transition directive to combat greenwashing. However, on 20 June 2025, the European Commission announced its decision to withdraw from this directive, one working day before the final round of trilogue negotiations was scheduled to take place. According to the Commission, the directive would lead to high administrative burdens for small and micro-enterprises. This withdrawal took place shortly after the Commission received letters from (centre-)right parties indicating that they did not support the proposal, indicating that political pressure played a role. Furthermore, withdrawing a directive is a rare process, which sets a worrying precedent.

Revision of Waste Framework Directive

The revision of the Waste Framework Directive, proposed in 2023 and in force from 2025, establishes that extended producer responsibility (EPR) for textiles must be introduced in all EU member states. This instrument must make producers responsible for the entire life cycle of products, including the collection and treatment of waste. EPR became mandatory in the Netherlands for consumer clothing, workwear and household linen earlier than this revision. EPR will be discussed in more detail under Dutch policy.

Product Environmental Footprint Category Rules

This initiative contains new rules to measure the environmental impact of products in a universal way. The PEF method calculates this impact on a life-cycle basis. The textile strategy indicates the use of this method as a way to measure green claims. However, the data used for this, collected by the European Commission, often contains inaccurate or outdated secondary data, which makes fast-fashion companies look better off in the calculation than is the case in reality. Companies can provide primary data, but this costs time and money, so there is little incentive to do so. This creates a false sense of precision and leaves plenty of room for producers to avoid accountability. 

In addition, companies can pay to get voting rights in the decision-making process, which can call into question the interests behind the decisions. This is a worrying example of industry lobby influence, making policy instruments less ambitious and effective. 

Although the use of the PEFCR is currently still voluntary, the PEF method is regularly cited by policy makers.

Ecodesign for Sustainable Products Regulation

Type: Regulation (EU) 2024/1781
Status: In force 

The Ecodesign for Sustainable Products Regulation (ESPR) is intended to replace the Ecodesign Directive and falls under both the Circular Economy Action Plan (CEAP) and the EU textile strategy. It sets minimum design requirements (or 'ecodesign requirements') for specific product groups to improve the lifetime and circularity of the product. Textiles are the first product group for which these requirements are being further elaborated.

There are a number of new measures falling under the ESPR, including: 

• Digital Product Passport (DPP) (future): A digital identity card will be introduced to make information on products and materials available. This information can relate to the materials used and their origin, recycling options and environmental impacts throughout the life cycle. The goal is to strengthen sustainability and circularity by holding producers transparently and verifiably accountable for compliance with the legislation. 

• Ban on destruction of unsold products: On average, about 4-9% of all textile products are destroyed before they are even introduced to the market. Therefore, rules are being introduced which stipulate that unsold textiles and footwear can no longer simply be destroyed. This ban will apply to large companies from 19 July 2026. For medium-sized companies, this will apply in 2030. 

However, there is limited attention within the ESPR to the complexity of the textile sector. The ESPR prescribes a 'one-size-fits-all' approach, while there are significant differences in quality and application of different materials and textile products. As a result, there is a risk that regulations will not sufficiently align with the specific characteristics of different product categories. 

There are also concerns about transparency and traceability in the chain. Collecting reliable data on the production side is difficult, and combined with a lack of enforcement outside the EU, this makes it hard to meet the requirements of the ESPR. Particularly for SMEs, which make up a large part of the sector. At the same time, this complexity provides room for companies with more resources to exploit opportunities and shift responsibilities within the chain, as also discussed under the PEFCR initiative. It is therefore important that the ESPR provides further clarification and that compliance with the ESPR is effectively enforced.

Circular Economy Act

Type: Unknown
Status: Proposal

A future policy instrument, namely the Circular Economy Act (CEA), which falls under the EU's Clean Industrial Deal, must ensure that the internal market for secondary raw materials and materials is improved and strengthened, and that the demand for these is stimulated. This will be done through a mix of different interventions, such as further simplification, digitalisation and expansion of EPR schemes. 

This is also necessary, as we previously wrote that the CEA must create a long-term framework in which EPR schemes become legally binding and more harmonised. In addition, it is also important within the CEA to recognise that the quality of secondary materials can vary greatly. For textiles, for example, technology already exists to produce secondary materials that can match primary materials. 

The CEA was open for public consultation from August to November 2026, with the aim of being adopted in 2026. Read here Fair Resource Foundation’s reaction to this consultation. The potential of the Circular Economy Act is great, also for the textile sector, but it is necessary that feedback from a broad group of stakeholders is seriously taken on board and that ambitious and harmonised measures are established. 

Dutch textile policy

The Netherlands is a relatively large player in the EU textile market and is among the five largest textile exporters. That is why the Netherlands is working on additional textile policy. Just as at EU level, a number of overarching policy programmes and laws determine Dutch textile policy:

The Climate Agreement, the Climate Act and the Climate Plan

The National Circular Economy Programme (NPCE)

Within the NPCE, the government again designates textiles as one of the priority sectors. Therefore, the Circular Textiles policy programme has been introduced to further shape this transition in the Netherlands. Extended producer responsibility (EPR) for textiles is the main policy instrument. Below we discuss each of these dossiers.

The limits of current textile policy

Although the described policy frameworks and laws are not the only initiatives, the above overview does show that a large number of policy dossiers will determine what the future of the textile sector will look like. At the same time, the processes illustrate that structural problems in the sector, such as a lack of ambition level and enforcement, can undermine the potential of (future) policy.

For actual system change, it is crucial that textile policy has a high level of ambition, but in practice policy makers often tone down ambitions under pressure from the industry. This is evident, for example, in the EPR policy, where producer responsibility organisations (PROs) can use their influence to affect policy while other stakeholders receive little say. The development of initiatives such as the Product Environmental Footprint Category Rules (PEFCR) for apparel and footwear, discussed earlier in this article under the EU strategy for textiles, is also worrying. Research showed that producers could acquire voting rights in the decision-making process through a financial contribution, meaning participation is only available to parties with the deepest pockets. The withdrawal of the Green Claims Directive (see also EU textile strategy), at a late stage in the policy process, is another example of the worrying precedent that policy makers are setting for the influence of political and industry lobbying in future policy processes.

In addition, enforcement within the complex and global textile chain remains difficult due to limited transparency and traceability, which undermines the effectiveness of instruments such as the PEFCR or the Ecodesign for Sustainable Products Regulation (ESPR). The further down the chain, the harder it becomes to obtain reliable information about the production, composition and origin of products. This increases the likelihood that companies will evade regulation and shift responsibility. The lack of transparency and reliable information is therefore a recurring bottleneck in the dossiers discussed.

Conclusion

Although hard work is being put into introducing textile policy for both the front end of the chain (production, working conditions, use of recycled fibres) and the back end of the chain (responsibility for waste), the question remains to what extent these directives and regulations will actually succeed in making the textile industry more sustainable. As long as linear production is still profitable, circular textile policy is merely a plaster on a major wound.