In a fresh sign of the European Union’s ambitions to expand its green regulatory footprint around the globe, the bloc’s environment chief Virginijus Sinkevicius vowed to zero in on the apparel industry to ensure that it avoids using harmful chemicals and wasting water. Sinkevicius says the new draft EU rules will aim to require information on clothing labels about the resources used in manufacturing and set sustainability obligations for producers seeking access to the €500 billion European single market for textiles and apparel.

The EU announced in December an unprecedented “Green Deal” to become the first climate-neutral continent through an economic overhaul that will affect industries ranging from energy to agriculture.

The new “circular economy” initiative covers industries ranging from textiles and construction to electronics and batteries. It sets the stage for months of work by the European Commission, the EU’s regulatory arm, on detailed proposals that EU lawmakers would need to approve in a process lasting many more months. The portion of the plan dealing with textiles has the potential to affect numerous apparel companies that rely on low-cost Asian countries including China, Vietnam and Bangladesh as production sites.

It would be a further example of how the EU, the world’s most lucrative single market, deploys its rule-making authority to exert soft power over businesses across the globe. A previous landmark example of this occurred in the mid-2000s when, during three years of deliberations, the EU pushed through tougher chemical rules over the resistance of the industry and trade partners.

Sinkevicius says EU national governments would have to step up enforcement of any new environmental legislation covering the textiles industry to ensure the bloc’s credibility. He signaled that the future EU labeling framework for textiles would resemble decade-old European eco-design legislation for improving the energy efficiency of household appliances like refrigerators and televisions. These rules, which include labeling requirements, have helped cut EU electricity consumption by the amount of power that Italy uses annually.