Who is the producer of a licensed brand under SB 707

We read SB 707 as reaching licensed brands through a producer definition built around the company that makes a product and owns or licenses its mark. The September 29 concepts add registration, duty-assumption, exemption and list procedures without specifying how those procedures distinguish a licensor from its licensees. In the recorded portions of the workshop, no commenter raised that distinction. Our inference is that the practical question is how the statutory hierarchy becomes a record for each licensed product, rather than whether the word licensee appears in the law.¹

Licensed brands account for a large share of the apparel, footwear and accessories market in our assessment, as stated in our October 6 letter. We do not use that assessment as a measured California market share. The statute defines covered products as apparel or textile articles and names footwear, handbags and backpacks among the apparel categories. Its two locations for licensee language are the definition of brand in PRC 42984.3(e) and the definition of producer in PRC 42984.3(s). The wider collection, reuse and end-market concepts are in Parts I and II of the discussion document.²

The first tier joins two requirements in one person: manufacturing the covered product and owning or licensing the mark. Exclusivity is not stated in that paragraph. If no person in the state qualifies under it, paragraph (s)(2) reaches the brand owner or, if the owner is not in the state, the exclusive licensee. That paragraph defines exclusivity by the right to use the mark in the state in connection with manufacture, sale or distribution of the covered product. We read the difference between these paragraphs as consequential for a non-exclusive manufacturing licensee.³

If neither of those tiers supplies a producer in the state, paragraph (s)(3) reaches the importer. If none of the first three does, paragraph (s)(4) reaches the distributor, retailer or wholesaler selling the product in or into the state. Paragraph (s)(5) deems a sale to occur in California when the covered product is delivered to a consumer there. We read that delivery rule as a rule about the sale’s location, rather than a complete answer to which company occupies a tier.⁴

Paragraph (s)(6) allows a person who manufactures, distributes, imports, offers for sale or sells the product to assume some or all producer duties and liabilities and relieve another such person. The text does not give every trademark owner an unconditional right to assume duties merely because it owns the mark. Paragraph (s)(8) excludes a seller below $1 million in annual aggregate global turnover, subject to annual inflation adjustment and the listed aggregation rules. We therefore read producer identity, eligibility to assume duties and eligibility for the exclusion as separate questions.⁵

The table applies the hierarchy to five licensing structures. Each result is our reading, conditional on the stated facts and on which persons are in the state. We would begin with a covered product and its chain of manufacture and sale, then test the tiers in order. A brand-wide answer without product and territory boundaries risks skipping the conditions that move responsibility from one tier to the next. A registration record should preserve those conditions so that a later change in manufacturing, import arrangements or exclusivity can be assessed against the original conclusion.⁶

The specification-approval row deserves a separate inquiry. Oregon’s packaging rule includes directing manufacture within manufacturing, including setting packaging specifications. Circular Action Alliance’s Oregon guidance distinguishes a licensor that merely licenses a mark from one that directs production. Its Colorado guidance describes a tier for a brand owner directing or performing manufacture of packaging, followed by the licensee directing manufacture. These are packaging precedents, not SB 707 rules. Our inference is that approval rights merit examination, without importing either state’s result into California textile law.⁷

We would also separate a conclusion about one agreement from a conclusion about the whole brand. A category licensee may have manufacturing rights for one covered product and import another. An exclusive right may have geographic and product limits. Under our reading, a useful record names the entity, covered products, territory, relevant agreement provisions and proposed tier together. It also records the facts that would change the result. That is a practical way to test the registration concept, rather than a new legal requirement we attribute to it.⁶

Part III’s written concepts address producer identification, product exclusions and additional lists. We rely on the discussion document for Section 1’s registration, territorial, duty-assumption and small-seller language. The transcript captured the introduction of those topics and the move to Section 2, but not an oral presentation of the Section 1 concepts. The distinction matters: the passages below are what the agency wrote, not words reconstructed from the webcast.⁸

The registration concept would make the producer responsibility organization, or PRO, responsible for mapping an entity into the producer hierarchy. It would provide registration forms, documentation and a registration number, maintain an inventory and submit it to CalRecycle. Updates would include annual updates and changes within 30 days of a change in producer status. Feedback question 2 asks what documentation identifies a brand owner, licensee, manufacturer, distributor, importer or wholesaler. That is the express licensee reference in the September registration feedback questions.⁹

Our reading is that the agreement’s allocation of manufacturing rights, exclusivity and territory should be available beside the claimed tier. A declaration that the company handles the brand is too imprecise to distinguish ownership from a license or a non-exclusive grant from an exclusive one. We would ask for the governing provisions or an attestation identifying them. The concept asks for documentation but does not yet specify this form of evidence. Our recommendation responds to that request rather than treating an agreement-upload requirement as adopted.⁹

The September concept proposes jurisdiction of California courts and/or voluntary assumption of responsibility as criteria. The SB 54 comparison is more specific: 14 CCR 18980.1.1(a) applies its in-state test to the first two statutory tiers and combines jurisdiction with service in California or consent and registration. We read that comparison as a drafting reference, not a textile rule. The September text does not reproduce all those conditions or expressly state the same tier limitation. Consumer delivery is separately addressed by PRC 42984.3(s)(5).¹⁰

The concept would place a standardized agreement form in the PRO plan. Its seven filing fields are both entities’ registration numbers, covered products and brands and SKUs, effective and termination dates, fee responsibility, a records-access clause, specified duties and liabilities, and circumstances in which repeated breaches may terminate the agreement. The broader framework has eight numbered provisions across pages 24 and 25. Supporting records could include the agreement, brand-owner authorization and the affected brands and SKUs.¹¹

The concept’s possible nullity triggers include the assuming party ceasing to exist, dissolving, becoming insolvent or becoming unresponsive to the PRO or CalRecycle. It would recognize compliance for the covered producer and products only after PRO approval and confirmation that the assuming entity meets its own and assumed obligations. The assuming entity would have to be in the state with respect to the Act. These are proposed conditions. A private promise to pay fees is not described in the document as sufficient to complete the proposed process.¹²

We read the proposed agreement as the practical instrument for an eligible licensor and licensee to allocate duties. The text does not mention the license agreement, a sell-off period after termination or consolidated filings for several licensees. Our recommendation is to connect the assumption schedule to the underlying license and identify what survives expiration. We would distinguish the agreement’s end date from the last date on which covered goods are sold. We would also specify who can supply the records needed to prove the assuming party remains compliant.¹²

The September small-seller concept would use standardized forms, supporting records, notice to CalRecycle and annual renewal. The statute’s aggregation tests concern ownership, voting, board appointment and rights to manage affairs, with related-entity combinations. The August discussion document proposes turnover as gross revenue across covered and other sales, inside and outside California. Its feedback question expressly includes licensing relationships among the structures needing clarification. We read a royalty relationship alone as different from the enumerated control rights, while recognizing that the actual agreement and corporate structure must be examined.¹³

September’s additional-list concepts name a Small Seller List and a Personal Protective Equipment List. Proposed fields include entity name, product name and effective date, with evidence and update procedures. The August producer-and-brand-list concept names producer, associated brands, covered products, contact information and registration date. Neither field list expressly identifies the registrant’s relationship to the brand. Our reading is that a relationship field and an assumption-agreement reference would make the list interpretable when several licensees deal in different products under one mark.¹⁴

That distinction has a statutory consequence. PRC 42984.20(c)(2) ties the sales prohibition, after plan approval, to the producer’s compliance listing for that brand and covered product. Subdivision (d) contains exceptions for a seller fulfilling the obligations itself, a compliant listing at the relevant sale date and specified existing inventory. We read the brand, product and entity combination as the relevant record to reconcile. A brand appearing somewhere on a list does not by itself answer the question posed by the statutory wording.¹⁵

The moderator announced at 14:07:05 that Rob Hammerstad would present Part III straight through, with questions at the end. Hammerstad identified himself as supervisor of the Textiles Enforcement Unit at 14:07:36. He introduced Section 1’s four topics at 14:07:57, reached the hierarchy slide at 14:08:43 and moved to Section 2 at 14:08:52. The capture has no text between 14:09:12 and 14:20:20. Whether Section 1’s concepts were presented orally, and in what words, is not established by this record.¹⁶

The captured invitation to questions began at 14:23:03. The moderator referred participants to the discussion document, asked about producer identification and exemptions, and moved on without a public comment on Part III. The close of that invitation is preserved below. Our inference is limited to that exchange and to the other recorded portions: the licensing question was not raised there. It is not a conclusion about every minute of the workshop, private discussions or written submissions.¹⁷

The recorded public discussion concentrated on the recovery system. Matthias Wallander of use again addressed international reuse at 10:15:47. Jessica Franken, speaking for SMART, discussed international secondhand markets at 10:49:52. Samantha Sabyrin of Just Zero introduced transparency and performance concerns at 10:54:23. Alexandra [Farah] of Fibershed discussed composting at 10:55:58. Ms. Wilson of New Echo Fab addressed dry weighing and chain of custody at 11:34:21. Tanita Gray of [Shoe’s LLC] discussed footwear recovery at 13:38:34. Janay D’Ambrosio of D’Ambrosio Trading addressed collection in small communities at 14:01:11.¹⁸

The October 6 and October 16 coverage review also provides a narrower starting point than a claim of novelty. Katten discusses exclusive and non-exclusive licensees and allocation by contract. Curtis describes contractual assumption of duties and recommends reviewing licensing agreements. We distinguish that allocation from the question of statutory producer identity. We build on those questions. Our inference is that the September documentation proposals make it possible to ask more precisely which agreement provisions and brand relationships belong in the administrative record. We do not infer from a search that no other adviser has considered them.¹⁹

We submitted our comment letter on October 6, 2026. Appendix A reproduces the sent text. Its six requests concern registration evidence, the territorial test, duty assumption, producer-and-brand lists, the small-seller exclusion and annual reporting. The letter’s proposals should be read as recommendations. Submission does not establish agency agreement with them.²⁰

1. Registration: we asked for a registrant’s relationship to each brand and evidence of California exclusivity and manufacturing rights.²⁰
2. Territory: we supported alignment with the SB 54 territorial test and asked which tiers the test would govern.²⁰
3. Duty assumption: we supported a standardized agreement with additions for the license’s term and sell-off period, consolidated schedules, notice and a cure period, and an express allocation of duties and liability.²⁰
4. Brand lists: we asked for fields identifying the relationship to the brand and any assumption agreement.²⁰
5. Small sellers: we asked for clarification that a license alone does not aggregate licensor and licensee turnover.²⁰
6. Annual reporting: we asked who reports when both parties are registered, so the same units are not counted twice or omitted.²⁰

Our reading is that these requests connect the registration decision to the later records used for compliance and reporting.²⁰

The statutory deadline to join the approved PRO was July 1, 2026. Landbell USA’s published registration guidance describes a flat $1,000 administrative fee for the 2026–2027 cycle. Neither that fee nor an account in a registration system settles the licensing analysis in this brief. Our recommendation is to confirm, brand by brand and category by category, which legal entity registered, the tier it relied on, and the agreement provisions supporting that position. Keep a record of the response rather than inferring coverage from the brand name alone.²¹

We recommend four preparatory steps. First, reconcile the registration record with the covered products and entities in the licensing portfolio. Second, read the agreement for manufacturing, import, exclusivity, territory and specification-approval rights. Third, identify any eligible assuming party and prepare a schedule of duties, brands, SKUs, dates, records access and fee responsibility. Fourth, trace the proposed reporting path from the licensee’s product and sales records to the information the PRO needs. These are our recommendations, derived from the statutory hierarchy and the written concepts, rather than additional regulatory requirements.²²

For that fourth step, PRC 42984.17(g) requires the PRO’s annual report to state amounts sold in or into California, broken down by fiber-type category and Harmonized Tariff Schedule of the United States number. Subdivision (k) separately addresses collected products attributed to a registered producer. We would reconcile the identity used in registration with the entity supplying sales data before combining reports. We would ask how a transfer between licensor and licensee is distinguished from a sale into California, and how two registered parties prevent counting the same covered product twice.²³

CalRecycle’s next noticed workshop is November 12, 2026, from 10:00 AM to 5:00 PM Pacific Time, at Byron Sher Auditorium, 1001 I Street, Sacramento, with Zoom participation and a public webcast. The announced topics are the Producer Responsibility Plan, Contingency Plan, Plan Termination, Plan Revocation and Cessation of PRO Status, and Annual Reports. We regard the annual-report discussion as the next place to test the reporting question. The notice establishes the agenda, not an outcome on allocation or double counting.²⁴

We watched the public webcast live and transcribed it automatically with Pacific Time timestamps. Marked transcript quotations are verbatim from that capture and may contain recognition errors. We correct a word only where the capture notes or discussion document make the intended reading unambiguous, and mark the correction in brackets. Appendix C retains the full captured passages for the quotations used here. The document excerpts are written agency text, presented separately from the spoken record.²⁵

The coverage bar identifies the capture intervals and interruptions: about 10:00–10:05, about 10:18–10:48, 10:57:29–10:59:11, about 11:33–11:34, 14:09:12–14:20:20 and the closing interruption before 14:31:34, alongside the lunch break. The notes estimate the closing interruption at about 14:29:30, while the supplied transcript’s preceding text ends at 14:24:41. We use the wider interval for transcript coverage. Accordingly, every statement that no commenter raised the licensing question refers to recorded portions. We did not use an official recording to validate these quotations.²⁶

Statutory passages reproduced in the discussion document were checked against the Legislative Counsel’s current code on October 16, 2026. We use that code for provisions outside the discussion document and for the timeline dates. Concepts are described conditionally because a discussion document does not itself establish the final regulations. The source register distinguishes primary texts, our contemporaneous capture and secondary commentary. Interpretations of licensing structures and suggested next steps are identified as our reading or recommendations.²⁷

Prior coverage was searched on October 6 and October 16, 2026. The review covered Katten, Curtis, Foley & Lardner, DLA Piper, Holland & Knight, Sidley, K&L Gates, Beveridge & Diamond and Greenberg Traurig, alongside AAFA, NRF, RILA, California Retailers Association, Licensing International, License Global, The Licensing Letter, Total Licensing and SMART. Search terms combined SB 707 and Responsible Textile Recovery Act with licensor, licensee, licensing and duty assumption. Search findings describe accessible published material, not the complete comment record. We submitted the letter in Appendix A and have a commercial interest in licensors understanding this regulation.²⁸