In European households, textile consumption is the fifth-highest cause of pressure on the environment and climate after food, housing, mobility and the hospitality industry. The production, use and disposal of textiles contribute to the overconsumption of natural resources, water pollution and greenhouse gas emissions. Yet individual consumption of clothing is growing: the number of garments purchased per capita globally increased by 60% between 2000 and 2014, and the share of turnover generated by clothing and textile sales more than doubled in the EU from 5% in 2009 to 11% in 2022. Annual textiles consumption in the UK and EU is estimated to be 2-3 times the global average; in 2022, European per capita consumption of clothing was 8kg.
The UK and EU have both proposed initiatives to tackle – directly or indirectly – fast fashion and textile waste such as EU Regulation 2024/1781 Ecodesign for Sustainable Products (2024) and UK Producer Responsibility Obligations (Packaging and Packaging Waste) Regulations (2024). These aim to address negative impacts throughout the clothing supply chain, from bans on destroying unsold goods to mandatory Digital Product Passports that provide digital data on a product’s origin and environmental impact. While these measures are vital to increasing the circularity of products yet to be created, to reduce the environmental impact of clothing,0 it is also necessary to extend the lifespan of products already in circulation. The clothing resale market, growing at an even faster rate worldwide than the firsthand market, has the potential to play an important role here.
This potential should not be restricted to domestic activity. Many resale platforms already permit cross-border customer to customer (C2C) sales, but in this blog, I argue that the current customs treatment of clothing sold on these platforms does not facilitate cross-border sales. Using the UK-EU trade relationship as a framework, I explore two key barriers: firstly, the legal terminology and customs classification of secondhand clothing, and secondly, the rules determining the application of customs duties.
Although UK-EU clothing sales have fallen significantly since Brexit, there is potential for high consumer participation in cross-border clothing resale. Both are developed, wealthy economies with high per capita textile consumption and relatively strong clothing resale markets, as well as strong similarities in terms of brand presence.
It is important to acknowledge the ongoing debate regarding the ethical and environmental merits of the secondhand clothing market. Research suggests that secondhand purchasing may “psychologically or economically justify continued overconsumption”– that it does not reduce, but instead sustains and adds to overall consumption.
Goods traded across borders are classified by the globally standardised Harmonised System (HS), partly to determine the duties to be applied. From the perspective of the circular economy, there are flaws in the current HS treatment of secondhand items. There are limited HS codes related to textiles waste and recycled textile content. Those that exist generally relate to specific fibres such as cotton waste (5102), waste of manmade fibres (5505) and rags (6310). While code 6309 applies to ‘worn clothing and other worn articles’, these are required to be presented ‘in bulk or in bales, sacks or similar packings’. Code 6309 is not permitted for the sale of individual worn clothing items – these must be classified according to product type and therefore attract the same duties as new items.
A further complication is a lack of internationally recognised standards or terminology relating to trade in used clothing and textiles. HS codes do not exclude the possibility of worn products being suitable for reuse, while the Basel Convention on Waste, which regulates the trade of waste materials, implies that ‘worn’ items are not suitable for reuse.
While the UK-EU Trade and Cooperation Agreement generally provides for zero tariffs and quotas on goods traded between the two, they must ‘originate’ in either the UK or the EU to qualify – and proof must be provided. Because the EU and UK both import more clothing than they produce, clothing sales between the UK and EU are likely to attract customs duties – even if a UK consumer buys a product online from a French company, if the fabric was produced and the item manufactured outside the UK or EU, customs duties will apply when it is shipped to the UK. Secondhand goods are not exempt.
Many secondhand items sold online are likely to fall below the UK and EU customs duty exemption thresholds for low-value imports (£135 and €150, respectively), meaning requirements to prove origin to avoid paying customs duties are currently moot. Both the UK and EU are planning to abolish these thresholds, after which low-value shipments between the UK and EU will require the payment of duties depending on the product type. Under the UK-EU Trade and Cooperation Agreement ,non-originating clothing generally attracts a 12% tariff.
The volume of paperwork is a major reason SMEs stop trading internationally. While private individuals selling secondhand clothing online are not SMEs, increased customs paperwork and costs could also discourage cross-border resale by consumers when current low-value customs exemptions end. This is especially relevant since affordability is often the primary driver for choosing to buy secondhand clothing.
In relation to both problems outlined above, achieving change at the global level is likely to be slow and complex. Some facilitations are attainable at regional level however with minimal recourse to challenging the global status quo.
Emerging research suggests that HS codes could be amended to facilitate the classification of items for resale. The UK and EU could agree new, more detailed codes based on the existing global HS structure to distinguish reusable secondhand clothing from waste for the purposes of UK-EU sales. These detailed codes could support zero or reduced tariffs for reusable worn clothing. There are precedents: the EU has already introduced 8-digit HS codes linked to circular trade, and India is considering a dedicated HS code for used yarn. This would be possible within the current Harmonised System and could be considered a useful test case on which future reform discussions could be based.
More detailed codes would allow customs authorities to gather more granular data on consignments and have better insight into circular economy trade flows. Conversely, they may also complicate the completion of customs functions at the border: additional, more detailed codes would require greater oversight from customs officers. Without accompanying proof, a more detailed HS code would not necessarily help officials determine compliance.
In relation to the economic nationality of goods, the UK and the EU could explore amending the criteria used to define when a good is ‘substantially transformed’ for origin purposes in relation to secondhand items, or expanding the permitted use of importers’ knowledge and supplier declarations to qualify for duty exemptions for secondhand items.
Permitting an exemption from the requirement to provide origin information for secondhand C2C clothing sales – and consequently eliminating the requirement to pay duties – may remove administrative or financial barriers to cross-border sales. This may also be helpful from a practical perspective: while items of clothing generally have a label that indicates where a product was made, this information may have been removed or be otherwise impossible to determine – vintage items, for example.
A broader option to consider is the establishment of a customs de minimis ‘zone’ comprising the UK and the EU. Under this mechanism, while customs duties would remain for low-value imports from outside the EU and UK (thus achieving the policy objective of addressing perceived loopholes around direct-to-consumer duty-exempt shipments from overseas marketplaces, namely Shein and Temu), this would permit each party to recognise the other as a trusted partner and apply reduced or zero tariffs for low-value shipments.
No solution is sufficient in isolation. In all the above cases, measures to increase resourcing at the border would be needed to help customs officials differentiate between and determine compliance with different HS codes and exemptions. There is no single policy solution to increase circularity and boost secondhand trade flows; a combination of measures is required.
[This blog stems from Kate’s final project for the Online Diploma in International Trade Policy, ‘Trade and Sustainability’ module].
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