Or: How to Turn European Regulation into Australian Competitive Advantage
There's a regulatory wave building in Europe that most Australian fashion brands aren't yet watching. By early 2027, the European Union will require Digital Product Passports (DPPs) for textiles and apparel entering their market (European Commission, 2024a). For brands exporting to Europe—or working with retailers who do—this represents a fundamental shift in how product information must be captured, verified, and communicated throughout the supply chain.
But while regulation feels distant, the operational capability required to comply takes 18-24 months to build properly. European brands are learning this now, scrambling to retrofit supply chains and supplier relationships under deadline pressure. Australian brands, by contrast, have something rare and valuable: time.
The question isn't whether this transparency infrastructure will become standard, it will. The question is whether Australian brands will lead this transition or play catch-up when it reaches our shores.
What Actually Is a Digital Product Passport?
Despite the bureaucratic name, a Digital Product Passport is remarkably straightforward: it's a digital record of a garment's journey from raw materials through production to eventual end-of-life (GS1 Australia & Seamless, 2024). Think of it as a product CV accessible via QR code or NFC tag.
For a cotton shirt, the passport might include:
- Material composition and origin (where the cotton was grown, where it was spun)
- Manufacturing locations and processes
- Environmental metrics (water use, carbon footprint, recycled content)
- Certifications (GOTS, Fair Trade, OEKO-TEX®)
- Care instructions and repair guidance
- End-of-life recycling information
This information serves multiple audiences: regulators verifying compliance, retailers managing inventory sustainably, and consumers making informed purchasing decisions (Anthesis Group, 2024).
The EU has prioritised textiles precisely because of the sector's environmental impact. Global textile consumption is projected to increase 63% by 2030—from 62 million tonnes to 102 million tonnes (Ellen MacArthur Foundation, 2017). In Australia alone, 222,000 tonnes of clothing was sent to landfill in 2024, whilst 1.5 billion new items were sold, equating to 55 items of new clothing for every Australian (Seamless, 2024).
The Australian Impact: Closer Than You Think
Here's the crucial detail many Australian brands are missing: you don't need to be a European company to be affected by European regulation (GS1 Australia & Seamless, 2024).
Australian businesses will need DPPs if:
- You export finished textiles to the EU (you're placing product on their market)
- You manufacture for an importer who sells to the EU (you must provide data so they can create the passport)
- You supply to EU brands or their global supply chains (buyer requirements will cascade)
- You work with major retailers expanding internationally (many now require this data)
- You seek ESG-focused investment or participate in sustainable fashion marketplaces
Even brands selling exclusively within Australia are encountering pressure. Major international retailers entering the Australian market increasingly require sustainability data from all suppliers. The Australian Fashion Council and Seamless have both been actively educating the industry about DPP readiness. Forward-thinking brands are recognising that verified transparency will be required and not a differentiator.
The Hidden Challenge: It's the Infrastructure, Not the Passport
When brands first encounter DPP requirements, the common response is: "We'll handle it when we need to." This fundamentally misunderstands the challenge.
Creating the passport, that is, the QR code, and the digital interface are relatively straightforward. The difficult part is having the underlying data infrastructure in place: supplier relationships that provide verified information, systems that capture and store compliance data, processes that maintain accuracy across product lines (TrusTrace, 2024).
European brands currently wrestling with 2027 deadlines report similar pain points:
- Suppliers without systems to provide required data
- Missing historical information about materials and processes
- No centralised system for managing certifications
- Difficulty verifying claims without audit trails
- Staff untrained in sustainability data management
Building this infrastructure requires time for supplier onboarding, system integration, staff training, and process refinement (SGS, 2025). It's not a task you complete in six weeks before a deadline, it's an operational capability you develop strategically.
The Strategic Window: From Compliance Cost to Competitive Advantage
Australian brands currently occupy a unique position: European regulation provides the business case for investment, but distance from compliance deadlines provides space for strategic implementation.
This temporal advantage creates several opportunities:
Operational intelligence: The data infrastructure required for DPPs simultaneously improves supply chain visibility, quality control, inventory management, and risk assessment. You're not just preparing for compliance, you're building business capability.
Market positioning: Brands with verified transparency capture price premiums amongst sustainability-conscious consumers (Bain & Company, 2024). You're positioned as an industry leader rather than a late adopter.
Risk mitigation: With the ACCC increasingly scrutinising sustainability claims, verified data protects against regulatory action and reputational damage. You're demonstrating claims rather than simply making them.
Access to capital: ESG-focused investors and grant programmes progressively require verified sustainability metrics. You're building the evidence base investors demand.
Retail relationships: Major retailers prefer suppliers with transparent, verified data. You're becoming the easy choice rather than the risky one.
Export readiness: When Asian markets follow Europe's lead (as policy experts predict), you'll be prepared whilst competitors scramble.
The smartest brands recognise something crucial: they're not implementing DPP infrastructure because of regulation—they're implementing it despite regulation potentially being years away, because the operational advantages justify the investment today.
Where the FM Circular Fashion IQ Index Comes In
This is precisely the problem the FM Circular Fashion IQ Index was designed to solve: bridging the gap between where brands are now and where they need to be for a transparent, circular fashion economy.
The Index provides three interconnected capabilities:
Consumer-Facing Verification: A QR-based circularity rating system that makes sustainability data accessible and actionable for shoppers, working across both new purchases and secondary markets (resale, repair, recycling).
Data Infrastructure: A verification system that aggregates sustainability certifications and compliance data, creating the backbone required for DPPs and other transparency requirements.
Accessible Validation: A pathway for small and independent brands to self-report sustainability data with AI verification, making transparency achievable without prohibitively expensive certification programmes.
Critically, the Index delivers value immediately, not just in anticipation of future regulation. Brands using it gain:
- Verified circularity ratings that can then command price premiums
- Protection against greenwashing accusations
- Operational visibility into supply chains
- Competitive positioning in sustainability-conscious markets
- Retail partnership advantages
- Investment and grant programme eligibility
The European compliance requirement becomes the forcing function that justifies the investment, but the operational advantage is the actual return.
A Practical Approach: Starting Small, Building Strategic
For brands wondering where to begin, the answer is simpler than it appears: start with your hero products.
A strategic pilot programme might involve:
- Select 3-5 key products that represent your brand values
- Gather existing sustainability data (you likely have more than you realise)
- Identify data gaps and create a supplier engagement plan
- Implement a verification system (like the FM Index)
- Test consumer response and iterate based on feedback
- Build internal capability before scaling across product lines
This approach achieves several objectives simultaneously: you develop organisational learning without overwhelming your team, you create market-tested examples before full commitment, you build supplier relationships progressively, and you position yourself as an industry leader whilst competitors watch from the sidelines.
The beauty of starting now is that you control the timeline. You're building strategically rather than reactively, calmly rather than frantically, with space for refinement rather than under deadline pressure.
The Broader Context: Australia's Circular Economy Future
The DPP conversation sits within a larger transformation. Australia's National Circular Economy Framework explicitly prioritises textile industry reform, circular economy literacy, workforce skills development, and market competitiveness (Australian Government, 2024). State governments are implementing complementary policies. The Australian Fashion Council is actively preparing the industry (Australian Fashion Council, 2024).
Transparency infrastructure isn't an isolated compliance requirement—it's foundational to the circular economy transition. Without verified data about materials, manufacturing, and environmental impact, we cannot enable resale, repair, recycling, and reuse at scale (Ellen MacArthur Foundation, 2017). We cannot close material loops. We cannot shift from linear to circular systems.
Brands building this infrastructure now aren't just preparing for European regulation, they're positioning themselves for Australia's circular fashion future. They're developing the capabilities that will define industry leadership over the next decade (Russo, 2025).
The Question Isn't If, It's When
Digital Product Passports and their variations are coming to Australian fashion. The timeline may shift, the specific requirements may evolve, but the direction of travel is clear. Transparency, traceability and verified sustainability data will become standard expectations across the industry.
As a result, we (brands) all face a few scenarios to choose from:
Option A: Build the necessary data infrastructure now, strategically, whilst you have time. Position yourself as an industry leader. Capture immediate market advantages. Arrive at regulatory requirements already prepared.
Option B: Wait and see how things develop. Assume the timeline is longer than it might be. Respond to requirements only when they become unavoidable. Implement under pressure with compressed timelines and higher costs.
Option C: Ignore the shift entirely. Hope it doesn't reach Australia or your specific market segment. Risk market exclusion, retail relationship loss and permanent competitive disadvantage when transparency becomes the baseline expectation.
Most brands, rationally, will choose Option B as the cost of building infrastructure might seem to be unwarranted in daily budgets.
However, we suggest that Option A might produce better short, medium and long term outcomes. Imagine your brand 12 months down the road. You've collected information, connected with verification systems, tested a few of your products and can create a strategy for scaling from 3-5 products to your entire range, especially those that are yet to reach the market. Now you have a differentiator that can be part of your brand's story - you're not just responding to market change, you're leading it.
The FM Circular Fashion IQ Index exists precisely to make Option A achievable, particularly for brands that lack the resources for expensive consultants or complex proprietary systems.
What Happens Next
If you're reading this and recognising that your brand needs to develop this infrastructure, here are three concrete next steps:
Audit your current state: What sustainability data do you already have? What certifications exist? What supplier information is accessible? Where are the gaps? This baseline assessment takes a few hours but provides crucial clarity.
Identify your pilot products: Which 3-5 products could demonstrate your commitment to transparency? Which would resonate most with your customers? Which supply chains are most mature?
Engage with verification systems: Whether through the FM Index or other platforms, explore how you can move from unverified claims to demonstrated evidence. Test the process. Understand the requirements.
The brands that move first will shape the conversation and will capture the competitive advantages whilst others are still deciding whether to act.
Final Thought: Infrastructure Before Crisis
There's a pattern across industries: regulatory changes that seem distant suddenly feel urgent, and the brands that prepared early capture disproportionate advantages whilst others scramble.
Australian fashion is approaching one of those inflection points. European DPP requirements will touch most brands directly or indirectly even as connsumer expectations for transparency are rising. Circular economy infrastructure is developing whlie investment criteria are shifting.
The brands that recognise this moment and build the necessary capabilities now, methodically, strategically, without crisis pressure, will emerge as industry leaders. They'll have verified data when others have vague claims. They'll have operational intelligence that they can use for market positioning and their ability to build that into export markets will position them well for scaling into future markets.
The question for Australian fashion brands isn't whether to develop transparency infrastructure, it's whether you'll do it strategically on your own timeline, or reactively under pressure.
The FM Circular Fashion IQ Index is currently piloting with Australian brands. For brands interested in participating in early trials or learning more about building transparency infrastructure, contact me directly at angelina@fleurieumade.com.
Angelina Russo,PhD is the founder of Fleurieu Made and creator of the FM Circular Fashion IQ Index, developed following extensive research across European and Asian circular fashion ecosystems. Her work focuses on making circular economy principles accessible and actionable for Australian fashion brands.
References
Anthesis Group. (2024). Digital Product Passports. https://www.anthesisgroup.com/au/insights/digital-product-passports/
Australian Fashion Council. (2024). Digital Product Passports: Unlocking the future of Australian fashion. https://ausfashioncouncil.com/news/digital-product-passports-unlocking-the-future-of-australian-fashion/
Australian Government. (2024). National Circular Economy Framework. Department of Climate Change, Energy, the Environment and Water. https://www.dcceew.gov.au/environment/protection/waste/circular-economy
Bain & Company. (2024). Digital Product Passports introduce new sources of value. https://www.bain.com/insights/digital-product-passports-introduce-new-sources-of-value/
Ellen MacArthur Foundation. (2017). A new textiles economy: Redesigning fashion's future. https://ellenmacarthurfoundation.org/a-new-textiles-economy
European Commission. (2024a). Ecodesign for sustainable products regulation. https://commission.europa.eu/energy-climate-change-environment/standards-tools-and-labels/products-labelling-rules-and-requirements/ecodesign-sustainable-products-regulation_en
European Commission. (2024b, November 13). Commission seeks views on the future Digital Product Passport. https://single-market-economy.ec.europa.eu/news/commission-seeks-views-future-digital-product-passport-2024-11-13_en
GS1 Australia & Seamless. (2024). Digital Product Passports explained: A resource for the Australian clothing textiles sector. https://www.seamlessaustralia.com/news/digital-product-passports-explained
InRiver. (2024). Digital Product Passport for textiles. https://www.inriver.com/resources/digital-product-passport-for-textiles/
Russo, A. (2025). Circular fashion futures: Insights from Asia and Europe for the Australian industry [White paper]. Fleurieu Made.
Seamless. (2024). 2024 National Clothing Benchmark for Australia. https://www.seamlessaustralia.com/national-clothing-benchmark
SGS. (2025, January). How the Digital Product Passport will reshape fashion supply chains. https://www.sgs.com/en-au/news/2025/01/cc-q4-2024-how-the-digital-product-passport-will-reshape-fashion-supply-chains
Start With Data. (2024). Digital Product Passport (DPP) fundamentals. https://startwithdata.com.au/dpp-fundamentals/
TrusTrace. (2024, August 29). How to prepare for the EU's Digital Product Passport Law. Fashion Dive. https://www.fashiondive.com/news/digital-passport-what-to-know-guide/725146/
UN Transparency Protocol. (2024). Digital Product Passport specification. UNCEFACT. https://uncefact.github.io/spec-untp/docs/specification/DigitalProductPassport/