Issue


Fast fashion’s high-volume, low-cost business model creates environmental waste, misleading eco-friendly claims and human rights risks in supply chains. What legal duties now apply to UK retailers, and how must they respond?


Short Answer


UK fashion retailers face mandatory obligations on unsold goods, green marketing and modern slavery reporting. Non-compliance carries fines up to 10% of turnover under consumer law, or £1 million for modern slavery, alongside severe reputational damage.


Development of the Legislation


Three regulatory developments drive this shift. First, the European Union (EU) Ecodesign for Sustainable Products Regulation (ESPR) bans large enterprises from destroying unsold apparel, accessories and footwear from 19 July 2026, with medium-sized firms following in 2030. The ban directly applies to UK brands selling into the EU market and to businesses in Northern Ireland under the Windsor Framework.


Second, the UK’s Digital Markets, Competition and Consumers Act 2024 which took effect on 6 April 2025 empowers the Competition and Markets Authority (CMA) to issue fines to businesses up to 10% of global turnover for misleading green claims without court proceedings. This enforces the CMA Green Claims Code, which requires environmental claims to be truthful, clear and backed by evidence.


Third, the Immigration and Asylum Bill (introduced on 30 June 2026) proposes reforms to section 54 of the Modern Slavery Act 2015. Commercial organisations with turnover of £36 million or more would face new strict rules: required topics in their modern slavery statements, a mandatory accuracy sign-off by a senior executive, and civil penalties of up to 1% of turnover or £1 million.


Alongside legislation, Waste and Resources Action Programme (WRAP) and the UK Textiles Pact published a 10-point Blueprint in January 2026 proposing a mandatory Textiles Extended Producer Responsibility (EPR) scheme with eco-modulated fees-meaning brands pay higher or lower fees-based on the environmental impact of their products. Though not yet binding law, it signals the UK's clear policy direction.


Analysis


These developments affect three stakeholder groups:

  • Retailers and Legal Teams:  Must manage unsold stock through resale, donation, or recycling rather than destruction; verify every sustainability claim with evidence; and trace supply chains to identify modern slavery risks. Meanwhile, Legal teams become central to compliance, advising on consumer protection, commercial contracts and human rights duties.

     

  • Consumers and Investors: Benefit from greater transparency and reduced greenwashing, though they may face higher prices as retailers absorb environmental and social costs. Investors increasingly treat Environmental, Social, and Governance (ESG) compliance as an indicator for risk management, favouring businesses with strong monitoring systems.

     

  • Law Firms: Involved across multiple practice areas. Consumer protection teams advise on CMA investigations and green claims compliance. Commercial and environmental teams structure EPR fee arrangements and waste contracts. Employment and human rights teams conduct supply chain audits and draft modern slavery statements. Litigation teams defend enforcement actions or shareholder claims.


Future Outlook
ESG regulation for fashion retailers will tighten further. The UK is likely to legislate Textiles EPR within this Parliament, following similar EU recycling rules. Modern slavery reforms will shift from voluntary reporting to mandatory duties with financial penalties.


For UK retailers, sustainability is no longer about promises. It is about provable compliance. Businesses that integrate legal, commercial and environmental teams now will avoid costly fines and reputational harm. Those treating ESG as marketing face severe financial and operational consequences.