Legal: Customs & Antitrust Guidance
The Price Parity Toolkit (PPT) aims to close the price gap between next-gen and conventional materials in the fashion industry. For effective and compliant implementation, brands should consider both Customs and Antitrust Guidance.
These guidelines help brands navigate international trade and competition laws, ensuring the shift to lower-impact materials isn’t hindered by hidden costs or legal risks. Customs Guidance clarifies how fee structures affect customs valuation, while Antitrust Guidance ensures fair collaboration and prevents anti-competitive behaviour, creating a transparent, competitive foundation for scaling sustainable materials.
For comprehensive findings and detailed implementation guidance, refer to the extended Customs and Antitrust Annex.
Customs Guidance
Navigating EU customs duties* is an important factor when implementing the PPT mechanism for garments containing next-gen materials. The Transaction Value, the price paid for goods exported to the EU, is the primary basis for customs valuation, but certain fees may be added.
Key Findings:
- Inclusion Rule: Volume-based fees on garments or materials are seen as a condition of sale and should be included in customs value.
- Separation Rule: To exclude a fee, it should be clearly separate from the product price, non-volume-based, not performed by the seller, and not linked to the goods.
- Product Fee: Simple to apply but raises customs value and import duties (however, if a 0% import duty rate applies, the impact is minimal.)
- Service Fees: Structuring non-volume-based service fees (e.g., R&D, Traceability, Supply Chain Engagement, Licensing) offers a chance for exclusion.
- Documentation: it is advised that records are kept for seven years, including service agreements, calculations, import docs, and correspondence. Legally drafted contracts are essential.
*This document focuses on the current European Union (EU) and Dutch customs legislation regarding the valuation of imported goods. If your operations extend outside the EU, please ensure you seek relevant local customs guidance. FFG will be expanding this guidance in upcoming iterations.
Antitrust Guidance
To ensure the PPT mechanism encourages sustainable innovation without hindering competition, antitrust compliance is crucial. It is important to establish clear boundaries for collaboration between brands and suppliers to mitigate potential risks.
General Rules:
- Don’t share commercially sensitive information.
- Pricing guidance may set maximum but not fixed resale prices.
- Avoid exclusivity or non-compete clauses.
- Select innovators and suppliers transparently and objectively.
- Legal advice might be needed for brand collaborations.
Tier-Specific Risks:
- Brands (Tier 0): Avoid collusion, price fixing, or market sharing. Keep the PPT open to new participants and ensure pricing freedom on final products.
- Innovators & Fibre Producers (Tier 4/5): Avoid resale price controls, exclusivity, or boycotts; ensure fair downstream pricing and open access.
- Supply Chain Partners (Tiers 3–1): Apply similar principles, no exclusivity, fair pricing, objective partner selection, and brand autonomy in choosing partners.
- Anti-trust guidelines typically discourage exclusivity. However, given the unique market conditions of next-generation materials, short-term, sourcing-limited exclusivity within the PPT may be permissible, provided specific market share conditions are met.
Other Projects
Sorting for Circularity Rewear
Fashion for Good expanded its Sorting for Circularity framework to address the challenge of sorting for rewearable textiles to understand better their resale potential and the demand across the second-hand market. We launched an 18-month initiative in January 2024 in collaboration with Circle Economy, brand partners adidas, Inditex, Levi Strauss & Co. and Zalando to enhance the sorting of rewearable textiles using innovative AI technologies. The project seeks to improve garment recovery for resale, promoting circularity in the fashion industry.
Behind the Break
Behind the Break is a multi-phase research initiative developed by Fashion for Good in collaboration with The Microfibre Consortium. The project takes a research-led approach to advance the fashion industry’s understanding of fibre fragmentation, addressing uncertainties in existing testing protocols and key knowledge gaps. By supporting the development of a more credible and consistent foundation, the initiative aims to enable stakeholders to make informed decisions and take decisive action to mitigate fibre fragment pollution, while leveraging the best available science.
Behind the Break 2.0
Behind the Break 2.0 is a targeted research initiative focused on addressing fibre fragmentation in textiles, building directly on the work started in Phase 1.0 (2024–2025), which tested the strengths and limitations of different methods used to measure fibre loss, identifying how much results vary between labs, and exploring what drives fibre shedding across three fabric types: cotton knit, cotton woven, and polyester knit. Phase 2.0 seeks to increase confidence in data quality, consolidate and refine existing testing approaches and knowledge across selected fabric archetypes, and deepen supplier engagement to support wider data collection within the space.
