PRAG Update — PPAI Product Responsibility Action Group

China's Supply Chain Security and Anti-Extraterritoriality Rules and Supplier Due Diligence

According to accounts from White & Case, LLinks Law Offices, Art of Procurement and August Debouzy, China's State Council has issued two sets of rules in 2026: the Provisions on Industrial and Supply Chain Security (State Council Order No. 834) and the Regulations on Countering Foreign States' Unlawful Extraterritorial Jurisdiction. LLinks Law Offices reports that the two decrees have moved from the statute book to the enforcement phase. Separately, August Debouzy writes that the instruments were quickly put into practice: in May 2026 the Chinese authorities prohibited the recognition or enforcement of certain U.S. sanctions targeting Chinese companies involved in the Iranian oil trade, and determined that certain information requests made by the European Commission to Chinese entities in its Nuctech investigation constituted improper extraterritorial jurisdiction.

White & Case writes that while many of the Provisions are directed principally at governmental coordination, several are of particular relevance to multinational companies, among them Articles 13 and 15. Under Article 13, as the firm summarizes it, any organization or individual that, in violation of China's laws, administrative regulations, departmental rules or relevant national provisions, conducts investigations or other information collection activities related to industrial or supply chains within China may be subject to regulatory consequences. The firm notes that Article 13 does not define what constitutes an "investigation," the required degree of connection to an industrial or supply chain, or which specific "national provisions" may serve as the basis for a violation, and says that, based on current enforcement trends, the provision is expected to focus on activities perceived as undermining PRC national interests rather than imposing a blanket restriction on commercially reasonable and legitimate due diligence. Article 15 authorizes investigations and restrictive measures against foreign companies or individuals that, in the language White & Case quotes, "contrary to normal market-trading principles, suspend or discriminate in commercial dealings with PRC entities in a manner that causes, or threatens to cause, material harm to China's industrial or supply-chain security". According to the firm, those measures can include prohibitions or restrictions on import or export activities involving China, bans or limits on investment within China, measures preventing or limiting Chinese organizations and individuals from transacting or cooperating with the foreign party, and entry, work-permit and residence restrictions; they can extend across an entire corporate group, potentially affecting controlled subsidiaries, including PRC-incorporated entities, even where they had no direct involvement in the underlying conduct; and an entity or individual within China that fails to comply with them can itself be sanctioned, with sanctions that can escalate to prohibitions or restrictions on government procurement, import and export, and cross-border transfer of data or personal information. In its practical takeaways, White & Case says the Provisions give authorities broad discretion to initiate supply-chain security investigations and to request information, that internal processes that involve centralizing China-related supply-chain data outside China, or commissioning third-party assessments that examine dependencies, bottlenecks or substitution strategies, may attract scrutiny if perceived as touching on industrial or supply-chain security, and that companies may wish to prepare internal response and dawn-raid protocols for inquiries relating to supply continuity, sourcing decisions, inventory management or the termination of supply relationships involving PRC entities.

Art of Procurement's Kelly Barner lists conduct that she writes can be treated as a threat under China's new supply chain rules, including moving business away from a supplier based in China, reshoring production from China to the United States or Europe, and complying with laws such as the UFLPA, and writes that "most companies sourcing globally are likely in violation." She writes that Article 13 makes supplier due diligence, audits, questionnaires and on-site inspections subject to greater regulatory scrutiny, while noting that it does not prohibit the audits themselves.

August Debouzy's article on due diligence in China reports the first judgment expressly applying China's Anti-Foreign Sanctions Law: a Singapore-based carrier had refused to perform certain obligations owed to a Hong Kong company on the grounds that the latter appeared on a foreign sanctions list, the Shanghai Maritime Court held that this justification was inconsistent with Article 12 of that law, and the carrier and its Chinese subsidiary were ordered to compensate their counterparty RMB 4.99 million plus interest. The firm writes that the Supreme People's Court published the ruling in June 2026, and that China's anti-foreign sanctions legislation "is no longer merely a deterrent." The firm also reports that French and European groups increasingly encounter reluctance among employees and executives of Chinese subsidiaries to respond to questionnaires from headquarters. It writes that local personnel may be concerned that their participation in collecting or transmitting information could be regarded as assistance in implementing a foreign measure, particularly where a request concerns matters such as U.S. or European sanctions not directly applicable to the Chinese entity, sensitive suppliers or supply chains, or forced labor, child labor or working conditions within supply chains. The firm's view is that Chinese law's growing regulation of how information about business partners and supply chains is collected and transmitted does not call into question the principle of conducting due diligence, but requires companies to tailor their reviews. Its recommendations include identifying the rule that justifies collecting the information before sending a questionnaire to a Chinese subsidiary; reviewing information flows before checks are launched, rather than after data has been uploaded to a global tool or transferred outside China; giving local employees an escalation mechanism so that a Chinese employee is not required to decide alone whether a headquarters instruction complies with local law; documenting why a due diligence step was not performed; and, where data cannot reasonably be obtained, exploring alternative solutions including third-party sources, research conducted from outside China, targeted controls or enhanced monitoring. On contracts, it describes clauses requiring compliance with all international economic sanctions regimes, or permitting automatic termination as soon as a counterparty is added to any foreign list, as particularly exposed, notes that change-in-law, hardship or force majeure clauses tailored to these situations may allow the parties to renegotiate or suspend certain obligations, and adds that "the ruling published by the Supreme People's Court in June 2026 suggests that such clauses may not, in principle, be upheld by Chinese courts." Where uncertainty remains, the firm says, the company must assess the residual risk and determine, based on its severity and likelihood, whether it may be accepted, reduced through additional measures, or requires declining the transaction. In matters involving the duty of vigilance, sanctions and anti-corruption, the firm says, the inability to access certain information is not in itself a ground for exemption from liability, but may be taken into account when assessing the due diligence reasonably available to the company, provided the obstacles have been analyzed precisely, alternative solutions explored, and the transaction not pursued where a violation of applicable law cannot reasonably be ruled out. The four articles are in Social Compliance & Fair Labor.

Magnets & Button Cells: Rules That Reach Beyond Toys

SHEIN's bear-shaped refrigerator magnets were recalled for violating the mandatory magnet ingestion standard, a distinct and acute hazard separate from button-cell batteries. CPSC described the product as decorative refrigerator magnets containing loose magnets that can appeal to children or teens, and did not classify it as a toy.

The scope of the two rules is worth stating precisely, because neither is a children's-product rule. 16 CFR part 1262 applies to a "subject magnet product" — a consumer product intended for entertainment, jewelry, mental stimulation or stress relief that contains one or more **loose or separable** magnets, excluding products sold solely to educators, researchers, professionals or industrial users. Where such a magnet fits entirely within the cylinder described in 16 CFR 1501.4, it must have a flux index under 50 kG²mm². Part 1262 **itself exempts toys subject to 16 CFR part 1250** (§1262.1(c)), which is why decorative magnets are charged under 1262 and toys under the toy standard. 16 CFR part 1263 separately reaches any consumer product containing a button cell or coin battery, and 1263.1(c) exempts a plaything for children under 14 that complies with the battery accessibility and labeling requirements of part 1250. So a light-up giveaway is within 1263 and outside 1262; a one-piece printed fridge magnet is outside both; a magnetic name badge is normally outside both.

ZMC Group expanded its recall of light-up children's toys for button-cell battery ingestion risk, and CPSC requested comment on the revised UL 4200A-2026 button/coin-cell standard incorporated by reference in part 1263; that comment period closed on 17 September. The mechanism matters more than the docket: unless CPSC affirmatively rejects the revision within 90 days of UL's notification, it becomes a mandatory consumer product safety standard by operation of 15 U.S.C. 2056e(f)(2), effective 180 days after that notification. Anyone sourcing light-up giveaways, badge reels, keyfobs or singing cards should plan to the new edition.

PFAS & EPR Deadlines Now

Minnesota's Amara's Law PFAS reporting deadline fell on September 15, 2026 — the first mandatory cycle for products containing intentionally added PFAS sold in the state, excluding products manufactured before July 1, 2023. A manufacturer **granted** an extension reports by December 14; MPCA says approval is not automatic and was still processing the queue. A manufacturer **denied** one reports 30 days after the notice of denial, or by September 15, whichever is later. Subsequent reports are due each year on February 1.

On the packaging front, California SB 54's Circular Action Alliance has its draft Funding and Services Agreement and project schedules out for comment until 24 October; the comment period on the draft program plan closed on 14 August. SB 1180, which would have set further parameters for the Plastic Pollution Mitigation Fund, was vetoed by the Governor on 20 September, while Maine DEP's packaging EPR stewardship RFP drew no proposals by its deadline, and DEP announced on 11 September that it would revise the RFP.

New Mexico moved the other way. On 16 September a federal court preliminarily enjoined enforcement of the state's PFAS labelling requirement, which would have applied to products manufactured after 1 January 2027. It is enforcement of the labelling requirement that was enjoined, not the law. The reporting obligation survives and falls due **1 January 2027** — a per-product filing naming the purpose and the amount of each PFAS — and the first material restrictions take effect the same day, a second tranche on 1 January 2028, with a general prohibition on intentionally added PFAS from 1 January 2032 unless an exemption applies.

Further out, New Jersey amended its PFAS in Products law to add **apparel** to the scope of its ban, footwear and outerwear for extreme wet conditions included, and to require manufacturers to certify that products contain no intentionally added PFAS and file notification with the Division of Consumer Affairs, each certification valid five years. Those amendments take effect 27 August 2028 — distant, but the certifications have to exist before then, which makes it a question for apparel supply agreements being negotiated now.

PPAI Responsibility Summit — Denver, September 14–16

PPAI returned to Denver for its 16th annual Product Responsibility Summit, an event that began there in 2011 as the PPAI Product Safety Summit, with the CPSC's Mary Toro, then Director of Regulatory Enforcement, as featured speaker. It took its present name as the program broadened from product safety and regulation to take in sustainability. This year's keynote came from David Katz of Plastic Bank, who described his work with manufacturers worldwide to keep the bottles their products ship in out of the environment and the oceans.

Boaz Green of Neal Cohen Law in Washington gave an overview of the Consumer Product Safety Commission under the current administration. Sheila Millar of Keller and Heckman followed with a state-by-state deep dive into the new packaging EPR laws. Karolyn Helda of QIMA covered US federal and state regulations affecting promotional products, with an overview of Europe as well, and Josh Kagan, a Washington trade attorney who previously served in the White House, explained the Section 301 duties and how they reach shipments into the US. Rick Brenner reviewed the CPSC's 2012 guidance on distributor responsibility under the CPSIA, including inks and tracking labels. Nathan Cotter, Tyler Brooks, Kate Alavez and Matin Sharifzadeh showed the computer- and AI-based tools they use to track ESG. Other sessions covered PFAS, sustainability and product life cycle.

Prop 65 Settlements: Lead, Phthalates, Chromium and PFOA

Nine of the settlements in this issue concern phthalates, and **all nine** turn on the same figure: 1,000 ppm, or 0.1 percent. That is the number to write into a PVC purchase order. Eight concern DEHP and one DINP — a faux leather cellphone purse — and the products run from PVC cosmetic and toiletry bags and a glitter phone pouch to clear journal covers, salt and pepper shakers with PVC plugs, and a PVC reflective safety vest. What varies is the mechanism, not the limit.

The two Davia bag settlements show the supply-chain form that mechanism takes. Both bind the supplier to the same standard — 1,000 ppm on each of six phthalates (DINP, DEHP, DBP, DIDP, DnHP and BBP) in any accessible component, by EPA methods 3580A and 8270C — which the Ohyeye decree labels "Phthalate Free" and the Zeonhra decree "DEHP Free" while pointing at an identical §2.2. Each supplier must pass that standard to its vendors and instruct them not to incorporate non-conforming material; **obtain a written confirmation and an accompanying laboratory test result from every new vendor before the first purchase**; and retain that documentation for two years, producible on written request.

Lead in decorated ceramic drinkware drove four further settlements. All four turn on a NIOSH 9100 wipe test at or under 1 microgram of lead, and they differ in what accompanies it. Silver Buffalo's licensed coffee cup qualifies on that wipe test alone, or on 90 ppm lead in all accessible components paired with it. Kaysons Handicrafts requires the wipe test and 90 ppm in any decoration, colored artwork, design or surface marking. The Blue Sky Clayworks and Culturefly mug agreements pair the wipe test with non-detect, defined as no more than 25 ppm, for decoration in the upper 20 mm of the vessel — the "Lip-and-Rim" area.

Two settlements fall outside lead and phthalates and are closer to the promotional catalogue than any mug. Vice Sporting Goods settled hexavalent chromium in leather golf gloves for $44,000 — a $4,000 civil penalty and $40,000 in fees — and its compliance route is unlike any other in the set: no concentration limit, but a warning unless the leather components are Reformulated Leather as that term is defined in a court-approved consent judgment in an unrelated case, Center for Environmental Health v. Bali Leathers. And Dick's Sporting Goods settled PFOA in bicycle saddle bags for $9,200, agreeing to stop using any added PFOA or any added fluorinated ingredient that causes PFOA to be present, including C9-15 fluoroalcohol phosphate, unless the product carries a warning. That is PFAS liability attaching to a bag rather than to a reporting form.

Tariffs & Customs Scrutiny Rise

CBP guidance issued September 11 implements Proclamations 11064 and 11065, which modify the list of Canadian goods carrying the 50 percent additional ad valorem duty under section 338 of the Tariff Act of 1930. Effective for goods entered on or after September 15, 122 HTSUS classifications become subject to the additional duty and ten are removed.

CBP's general notice on accuracy of Importer of Record data implements Executive Order 14411, and the enhanced enforcement it describes commenced on September 18: where CBP determines that information on a CBP Form 5106 is inaccurate or incomplete, it will immediately void the associated importer-of-record number. It applies to existing importers as well as new ones, and to customs brokers filing on their behalf; requests to reestablish a voided number go to IORProgram@cbp.dhs.gov under the subject line "Enforcing IOR Accuracy." CBP's advance notice on heightened import disclosures for supply-chain visibility remains open for comment until December 1.

On the enforcement side, a DOJ memo sets out the priorities of the Department's National Fraud Enforcement Division. In the memo's own words the Division will "lead the Department's coordinated criminal enforcement strategy, targeting trade and customs violations and supply chains polluted by forced labor," focusing on "systemic, high-impact noncompliance," including illicit transshipment schemes, country-of-origin fraud, the undervaluation of imported goods designed to evade duties, sanctions evasion and foreign forced labor schemes. Foley & Lardner reads the memo as confirming that the False Claims Act has been, and will likely remain, the primary vehicle in this push — a civil statute under which a case can be brought by a former employee, a competitor or a customs broker, with treble damages available.

Packaging EPR in the Courts

A federal court upheld Oregon's packaging EPR law as constitutional on 27 August, after a five-day bench trial. The operative consequence is that the decision lifted the February 6, 2026 injunction that had shielded the National Association of Wholesaler-Distributors and its members from DEQ enforcement: DEQ proceedings can resume, with fees and penalties available from both DEQ and the producer responsibility organisation.

The same plaintiff has filed suit challenging Colorado's packaging EPR law. NAW v. Ryan was filed in the District of Colorado on 30 July, and NAW moved on 5 August for a preliminary injunction barring enforcement **against NAW and its members**, with the state's response due by 16 September. A distributor that is not an NAW member would not be covered by the relief sought, and compliance obligations remain in effect until the court rules. In Oregon, NAW filed a notice of appeal to the Ninth Circuit on September 24 — after this issue's coverage period, noted because the decision is not final.

Recyclability Claims: SB 343 Enforcement Enjoined

On 14 July 2026 the US District Court for the Southern District of California preliminarily enjoined enforcement of California's SB 343, the Truth in Recycling law, in its entirety. *California League of Food Producers v. Bonta*, No. 3:26-cv-01675 (S.D. Cal.). The law was to become operative on 4 October 2026 following CalRecycle's material characterization study, and would have treated the chasing-arrows symbol, recyclability statements and directions to recycle as deceptive unless packaging met the state's 60/60 recyclability standard and further criteria tied to recycling outcomes and package design. The court held four provisions likely unconstitutionally vague — that a material "routinely becomes feedstock," that materials are sent to reclaiming facilities "consistent with the requirements of the Basel Convention," the incorporation of the Association of Plastic Recyclers Design Guide, and the requirement that products be designed to "ensure recyclability" and not contain features that "prevent recyclability" — reasoning that manufacturers cannot reliably determine compliance with standards that depend on downstream market conditions, evolving industry guidance and facility practices. On independent First Amendment grounds it found that recyclability claims are not inherently misleading, and that California had not produced sufficient evidence that the law would materially improve recycling rates or materially reduce consumer confusion.

Enforcement is suspended unless the injunction is stayed or overturned on appeal, and California-specific artwork or labelling changed solely to comply with SB 343 may be worth reassessing. The FTC Green Guides are unaffected: an unqualified recyclable claim is generally appropriate only where recycling facilities are available to a substantial majority — which the FTC defines as at least 60 percent — of consumers or communities where the item is sold, and the chasing-arrows symbol may convey both recyclability and recycled-content claims depending on context. Qualified disclosures such as "recyclable where facilities exist," "check locally" and component-specific instructions may now be easier to defend, provided they are adequately substantiated and presented in a manner that is not misleading. State false-advertising statutes and consumer class actions are unaffected, and the data developed in the state's preparations for SB 343 is available to groups bringing those claims. An appeal to the Ninth Circuit is expected; the district court distinguished *Association of National Advertisers, Inc. v. Lungren*, 44 F.3d 726 (9th Cir. 1994), and that conclusion would be reviewed de novo.

Toy Safety & Chemical Standards

The CPSC this period issued recalls for choking hazards from SHEIN spiral toys and Melissa & Doug fire-truck activity boards, and a separate recall of Lontcs Busy Boards for violating the federal lead paint ban. ISO issued ISO 8124-5:2026, “Safety of Toys — Part 5: Determination of total concentration of certain elements in toys”, which cancels and replaces the 2015 edition. It is a total-content method for eight elements — antimony, arsenic, barium, cadmium, chromium, lead, mercury and selenium — and SGS reports that it may be used to determine whether migration testing is required under ISO 8124-3 or equivalent standards such as EN 71-3 or ASTM F963. Among the changes: acid mixture A, a 1:9 mixture of hydrochloric and nitric acid, replaces reverse aqua regia for digesting non-metallic materials; hydrofluoric acid may optionally be added for complete digestion of paint and rubber; finger paints are added to the specified method detection limits; and a new Annex B sets out an energy dispersive X-ray fluorescence method for screening the eight elements in plastic toys.

ISO 9001:2026 Replaces the 2015 Edition — What Changed

ISO 9001:2026 replaced ISO 9001:2015 on 16 September, the first revision in eleven years, and ISO's own framing is refinement rather than reinvention: "Rather than revolutionizing a proven approach, ISO 9001:2026 refines it." The standard was revised not because the fundamentals of quality changed but because the environment did — digital technologies, more interconnected supply chains, and stakeholder expectations that continue to evolve.

The five significant changes ISO names are a stronger role for leadership, with greater emphasis on quality culture, ethical behaviour and an environment where everyone contributes to the system's effectiveness (clause 5.1); the quality policy linked more explicitly to the organization's context and strategic direction, so the system serves business objectives rather than compliance (5.2); a clearer distinction between managing risks and pursuing opportunities, with both feeding decision-making (6.1); new awareness requirements covering quality culture and ethical behaviour (7.3); and a new Annex A clarifying key concepts, terminology and the intent behind the requirements. ISO adds that smaller refinements and editorial clarifications run throughout, reflecting digitalization, organizational knowledge, increasingly complex supply chains and resilience.

What has not changed is the larger part. Customer focus, the process approach, risk-based thinking and continual improvement remain at the heart of the standard, and the climate-change consideration added by the 2024 amendment carries forward. ISO is explicit in its FAQ that the clause structure has not changed — the 2026 edition "retains the Harmonized Structure used across ISO management system standards" — and that organizations "should build on their existing systems and processes, keeping what works and making targeted changes where needed." An existing certified system is refined, not rebuilt. **This month's Classroom is ISO's own explainer of the revision** — the clearest short account of what changed, from the body that wrote it.

On timing, ISO says a certified organization has three years to move and will not need to start the certification process again, directing it to its certification body for the timing and next steps. Global ACI made that three-year period concrete and published mandatory transition requirements on the day the standard appeared. Global Accreditation Cooperation Incorporated assumed the roles of both the International Accreditation Forum and the International Laboratory Accreditation Cooperation on 1 January 2026; specified IAF and ILAC documents and marks remain in use through the transition, so a certificate citing them is not stale. Two dates bear on supplier approval and they do different work: from 31 March 2028 a factory can no longer obtain a *new* accredited certificate to the 2015 edition, while a factory that already holds one stays validly certified until 30 September 2029. The date to ask a supplier's certification body about is 30 June 2027, when that body's own transition declaration is due.