As of 19 July, if your company turns over more than €40m or employs more than 250 people, you can no longer destroy unsold clothing, footwear or accessories. This isn’t guidance. It’s Regulation (EU) 2024/1781, and it applies now.
What changed
The Ecodesign for Sustainable Products Regulation (ESPR) bans the destruction of unsold textiles for large companies. Stock that used to go to incineration or landfill now has to go to donation, reuse or recycling. And it has to be documented.
SMEs have until 2030. Large companies don’t. For them, the date has already passed.
The number that puts this in perspective: between 4% and 9% of textiles produced in Europe were being destroyed, and in fast fashion the share of unsold stock tops 25%. That’s roughly 5.6 million tonnes of CO₂ equivalent a year. And here’s the real catch: the EU only has mechanical textile recycling capacity for 1% of that volume. There’s a legal obligation, but not yet the infrastructure to fully meet it.
Why this is a data problem, not a logistics one
It’s tempting to read the ESPR as an operational headache: “I need to find a second-life operator and sign a contract.” That’s part of it, but it’s the easy part.
The hard part lands in 2027. From then, affected companies have to publicly disclose how much unsold stock they generate and what happens to it, under the ESRS E5 disclosure in their CSRD sustainability report. In other words: what used to be called “dead stock” and lived in a warehouse spreadsheet becomes an audited figure that a third party reviews.
That changes the game. It’s not about destroying less. It’s about being able to prove, with traceability, how much you generated, where each batch went and which operator received it. A number with no evidence behind it is no use to an auditor.
The three things you need now
If your company is in scope, there are three fronts to open in parallel:
- A dead-stock management protocol. What you do with what you don’t sell, in what order of priority (reuse before recycle, recycle before destroy), and who decides.
- ESRS E5 tracking with evidence. Volume alone isn’t enough. You need the trail: batch origin, destination, operator, date. Every data point linked to its document.
- Contracts with second-life operators. And here you hit the infrastructure bottleneck we mentioned: recycling capacity is limited, so the sooner you lock in agreements, the better.
Where Dcycle fits
The ESRS E5 disclosure isn’t a form you fill in at year end. It’s the output of data you already generate every time a batch leaves your warehouse for an operator. The problem is that this data lives scattered: in the ERP, on a delivery note, in the recycler’s email. That is exactly what automated data collection is built to solve.
In Dcycle that data goes in once and serves everything downstream: the ESRS E5 disclosure, the cost analysis of waste management, the evidence the auditor will ask for. One data point, many outputs. And with traceability linked from the source, by the time the FY2026 audit comes round the trail is already there, no reconstructing it after the fact.
Which is, in the end, the difference between reporting your dead stock and being able to defend it. If you want to see how this works with your own data, request a demo.
A note for anyone still on the clock
If you’re an SME with until 2030, the takeaway isn’t “I’ll deal with it later.” It’s the opposite: your large customers will start asking you for textile traceability data for their own ESRS E5, because you’re part of their value chain. The obligation reaches you through the customer’s door before it reaches you through the law’s.
Unsold clothing was always a business problem. Since 19 July, it’s also a figure someone is going to audit.