What The 2026 EUDR Revisions Mean For Fashion Brands

The European Commission has published its most consequential set of EUDR updates since the regulation was adopted. A draft Delegated Act revising Annex I, an updated Implementing Regulation, the third edition Guidance Document, the fifth iteration FAQ, the Simplification Review report, and the 4th edition Supply Chain Infographics all landed inside a few weeks. Together they reshape how the EU Deforestation Regulation (EUDR) applies to fashion supply chains. The EUDR is the EU law that requires companies to prove that products placed on the EU market are not linked to deforestation or forest degradation.

If your team has been preparing for EUDR over the last two years, the news is mostly good. Cattle leather is on its way out of scope. Brand and retailer obligations have been substantially reduced. And around half of import volume now qualifies for a simplified pathway. But the regulation has not gone away. The question for fashion teams is not whether you still need to act, but where the work now sits and how to redirect your readiness program accordingly.

AT A GLANCE

Three changes matter most for fashion. First, cattle leather (HS 4101, 4104, 4107) is being removed from scope through the draft Delegated Act, which lifts the heaviest EUDR burden off most brands and footwear retailers. Second, the downstream model is now passive: brands and retailers no longer file their own Due Diligence Statements and only act when concerns are raised. Third, a simplified due diligence pathway opens for sourcing from low-risk countries, with around 51 percent of import volume now qualifying. The application date is 30 December 2026 for most operators and 30 June 2027 for SMEs.

WHAT CHANGED IN THE 2026 EUDR REVISIONS?

The 2026 revisions tighten the scope of products covered, redistribute obligations across the supply chain, and create a simplified pathway for low-risk and small producers. Three legal acts and four guidance documents work together: the draft Delegated Act amending Annex I, Regulation 2025/2650 amending the core EUDR text, the updated Implementing Regulation on the Information System, and refreshed Guidance, FAQ, and Supply Chain Infographics from the European Commission.

Net effect on Annex I: seventeen HS codes added (mostly oleochemicals and palm-derived chemistry), three deleted (cattle leather), and one replaced (retreaded tyres narrowed to new tread only). Several horizontal exemptions have been codified, including bamboo, single-use packaging, marketing and information materials, samples of negligible value, used or second-hand goods, and recovered or recycled paper and pulp. None of this is bonus content for brands. Each item is a carve-out that removes work you would otherwise have had to do.

WHY IS LEATHER BEING REMOVED FROM EUDR SCOPE?

The Commission has concluded that including derived leather goods like footwear, handbags, and leather garments was disproportionate to the actual deforestation impact. The draft Delegated Regulation amending Annex I removes HS 4101 (raw cattle hides and skins), HS 4104 (tanned or crust hides), and HS 4107 (further-prepared leather).

The Commission Staff Working Document explains the reasoning: leather is a by-product of meat production with only 2.5 to 5 percent of the deforestation footprint attributable to the hide. Once the Delegated Act adopts, leather and finished leather goods fall outside EUDR. Cattle remain in scope, so the obligation sits with the meat side of the supply chain, not the leather side.

For your brand, this means: if your EUDR exposure was primarily through leather sourcing, that obligation effectively disappears. You may still want to maintain leather traceability for CSRD, CSDDD, and brand ethics commitments, but EUDR itself will not require a Due Diligence Statement on cattle leather. Use this descope as an opportunity to redirect compliance budget toward CSDDD readiness, where leather remains firmly in scope.

HOW DOES THE PASSIVE DOWNSTREAM MODEL WORK?

Under the revised EUDR, the operator who first places a product on the EU market carries the full due diligence obligation, while everyone further along the chain holds a passive collect-and-keep role. This is the single biggest shift in the regulation, formalised through Regulation 2025/2650 and clarified in the Commission's Supply Chain Infographics.

There are now three distinct actor types, each with a different set of duties:

• Upstream operator: the first natural or legal person to place a relevant product on the EU market, or the importer of record. They run full due diligence, submit the Due Diligence Statement (DDS), collect geolocation, and assume responsibility for compliance.
• Downstream operator: places or exports a product made using inputs already covered by an upstream DDS. No new DDS to submit. Collects upstream reference numbers and forwards them to the next downstream actor.
• Trader: makes products available without changing the HS code. Same passive collect-and-forward duties as a downstream operator.

Role is determined per product, not per company. A brand that imports natural rubber and uses it to make footwear soles is an upstream operator on the rubber input and a downstream operator on the new sole. The same logic applies to a sourcing team buying both EU-converted viscose pulp and direct-imported cotton trims.

For your brand, this means: most fashion sourcing teams are downstream operators or traders for products bought from EU suppliers. You collect the reference number from your supplier, store it for five years, and pass it on to your customer. You only become active if a Competent Authority raises substantiated concerns or if you receive credible information that a product may be non-compliant. Direct imports remain the exception: when you import an Annex I product yourself, you are the upstream operator and the full obligation lands on you.

WHO QUALIFIES FOR THE SIMPLIFIED DUE DILIGENCE PATHWAY?

Sourcing from countries classified as low-risk under the EU benchmarking system unlocks a simplified due diligence pathway, and around 51 percent of importing operators now source from these countries. Under Article 13 of the amended regulation, low-risk sourcing skips the formal risk assessment and risk mitigation steps.

Operators in this pathway still must collect Article 9 information including geolocation, evaluate supply chain complexity, and check for circumvention or mixing. Substantiated concerns still trigger full obligations. The simplification is real but not absolute: think of it as a faster track, not an exemption.

A second simplification targets micro and small producers. The new Micro and Small Primary Operator (MSPO) regime under Article 4a allows qualifying producers in low-risk countries to file a one-off Simplified Declaration rather than a per-shipment DDS. Postal address or cadastral information may replace geolocation when the location clearly corresponds. Cooperatives can act as authorised representatives and submit on behalf of their members.

For your brand, this means: audit your sourcing geography against the new country risk classification under Regulation 2025/1093. If most of your volume is from low-risk countries, the simplified pathway is likely your primary route. If you work with smallholders or cooperatives in those countries, the MSPO regime can dramatically reduce friction in onboarding them to compliance.

WHAT IS IN SCOPE AND OUT OF SCOPE FOR FASHION?

Fashion's exposure to EUDR is concentrated in a relatively narrow set of inputs: dissolving wood pulp for man-made cellulosics, natural rubber for soles and elastics, paper sold as a standalone product, and any palm-derived chemistry in own-label personal care lines. Cotton, wool, silk, and synthetic fibres are not in Annex I. Finished apparel made from these is not in scope either.

A practical implication: hangtags, care labels, polybags, mailer envelopes, showroom samples, and recycled-content paper can be excluded from your DDS workstream. Document the exemption rationale and keep evidence for the five-year retention period.

WHEN DO THE NEW EUDR RULES TAKE EFFECT?

The EUDR application date is 30 December 2026 for most operators and 30 June 2027 for SMEs and micro operators. The Information System reopens in June 2026 with new role registration, simplified declaration support, voluntary DDS grouping, and contingency reference numbers.

A few timeline anchors worth noting:

• 30 December 2026: general application date for all non-SME operators, downstream operators, and traders.
• 30 June 2027: application date for operators that were micro or small enterprises as of 31 December 2024.
• June 2026: Information System reopens with new functionality. Plan onboarding for the second half of the year.
• December 2026: Commission launches the legislation repository and certification scheme repository.
• 30 December 2027: first Article 12(3) due diligence system report due, covering 2027.

Products placed during the transitional window from 29 June 2023 to 29 December 2026 are subject to lighter rules. Downstream actors only need adequately conclusive proof of pre-application placement, not a DDS in the Information System. Mass balance chain of custody is not permitted under EUDR. Physical segregation is required at every stage of the supply chain.

FREQUENTLY ASKED QUESTIONS

Is leather still in scope under EUDR?

Cattle leather is being removed from scope through the draft Delegated Act amending Annex I. HS codes 4101, 4104, and 4107 are deleted. Once the Delegated Act adopts, finished leather goods like footwear and handbags fall outside EUDR. Cattle (live, meat) remain in scope, so the obligation sits with the meat supply chain, not the leather side.

Do brands and retailers still need to submit a Due Diligence Statement?

In most cases, no. Under the revised EUDR, brands and retailers buying products that have already been placed on the EU market are downstream operators or traders. They collect the upstream reference number, store it for five years, and act only if substantiated concerns arise. The exception is direct imports: when a brand imports an Annex I product itself, it becomes the upstream operator and the full DDS obligation applies.

What is the difference between an upstream and a downstream operator under EUDR?

An upstream operator is the first person or company to place a relevant product on the EU market, typically the importer or EU producer. They run full due diligence and submit the DDS. A downstream operator buys from an upstream operator and uses the product further along the chain. Downstream operators do not file a new DDS; they collect and forward the upstream reference numbers.

Does the EUDR allow mass balance chain of custody?

No. Mass balance is explicitly not permitted under EUDR. Commodities intended for the EU market must be kept physically segregated at every stage of the supply chain. This is reaffirmed in the 4th edition Supply Chain Infographics published by the European Commission.

How does the simplified due diligence pathway work for low-risk countries?

Operators sourcing from countries classified as low-risk under the EU benchmarking system can skip the formal risk assessment and risk mitigation steps under Article 13. They still need to collect Article 9 information including geolocation, evaluate supply chain complexity, and check for circumvention or mixing. Substantiated concerns trigger full obligations regardless of country risk tier.

KEY ACTIONS FOR FASHION BRANDS

Use the descope window to redirect EUDR effort toward the obligations that remain. The biggest mistake brands can make right now is assuming the work is finished. The work has shifted, not disappeared.

1. Map your supplier base by EUDR role. Tag each product line as Upstream Operator, Downstream Operator, or Trader. Most brand teams discover they are mostly downstream, which dramatically reduces day-to-day workload.
2. Flag leather-only SKUs for descope. Identify products that depend solely on cattle leather and prepare to remove them from your active EUDR workstream once the Delegated Act adopts.
3. Set up reference number exchange with tier-one suppliers. The first downstream operator in each chain must receive DDS reference numbers from upstream suppliers. Establish the data exchange now, before December 2026.
4. Audit your sourcing geography. Match your supplier countries against the new low-risk classification under Regulation 2025/1093. If most of your volume is from low-risk countries, the simplified pathway is likely your primary route.
5. Document exemption rationale. Hangtags, care labels, packaging, showroom samples, and recycled-content paper need a paper trail. Start a folder for the five-year retention obligation.
6. Plan Information System onboarding. Non-SME downstream operators and traders must register in the IS. The system reopens in June 2026 with new functionality. Plan onboarding for the second half of the year.
7. Confirm physical segregation in your chain of custody. Mass balance is not permitted. Verify with suppliers that EUDR-relevant commodities are kept physically segregated at every stage.

talk to trustrace

TrusTrace helps fashion brands and retailers navigate EUDR readiness by combining supply chain mapping, geolocation data collection, and DDS management in a single platform. Whether you are an upstream operator running full due diligence on natural rubber imports or a downstream operator building reference number exchange with your tier-one suppliers, TrusTrace gives your team the data infrastructure to act with confidence. Trusted by brands representing over $200 billion in combined retail sales, TrusTrace turns regulatory complexity into operational clarity. Speak with one of our experts or explore our EUDR solution.

Disclaimer: This content is for informational purposes only and does not constitute legal advice. Please consult legal professionals for guidance specific to your situation.