- Short answer
- Usually yes — if your own brand's packaged goods reach California buyers, SB 54 can make you the producer even from another state.
- The exemption is not automatic
- Register in PEPRS as a producer first, then apply; CalRecycle calls it temporary and renewable.
- What $1 million does not buy
- Exempt from most reporting and fees — not from making all packaging recyclable or compostable by 2032.
- Being out of state is not a shield
- No CalRecycle page or regulation we read on September 7, 2026 grants an out-of-state exemption.
- One ban is already live
- Producers cannot sell, distribute or import foam (EPS) food service ware in or into California: the 25% rate was missed.
- Where this page stops
- Scope: California SB 54 only. EU and UK packaging EPR are separate laws with separate registrations.
Who counts as the producer under SB 54?
SB 54 never asks whether you have a warehouse in California. Its definition of producer runs a chain of questions about one package and stops at the first person who fits.
The chain is keyed to the brand, not to the plant: a maker comes first only when it also owns or is licensed on the brand. That same split — the duty landing on the name on the label rather than on the plant that filled it — decides who pays the OMUFA facility fee.
Who the producer is, in order
| Order | Who the producer is | Rule |
|---|---|---|
| First | The maker in the state that owns or is licensed on the brand | PRC 42041(w)(1) |
| If no one fits | The brand owner, or the exclusive licensee in the state | PRC 42041(w)(2) |
| If still no one | Whoever sells or distributes the goods in or into the state | PRC 42041(w)(3) |
| Added later | A wholesaler or retailer in the state, for the added packaging only | 14 CCR 18980.1.1(f)(3) |
PRC 42041 and 14 CCR 18980.1.1, read September 7, 2026.
A carve-out sits inside the definition itself, and it is narrow: a person who produces, harvests and packages an agricultural commodity on the site where it was grown or raised is not a producer.
Does SB 54 reach a Shopify store outside California?
The first two rows above — the brand rungs — carry a jurisdictional test, and the regulation writes it for those two rows only. The permanent regulation in force since May 1, 2026 puts a person in the state when that person is subject to the jurisdiction of California courts and either can be served with summons in the state or consents to being considered in the state — legal reach, not an address. The third rung is written differently.
If there is no person in the state who is the producer for purposes of paragraph (1) or (2), the producer of the covered material is the person who sells, offers for sale, or distributes the product that uses the covered material in or into the state.
That rung asks only where the goods go. A store in Texas shipping its own branded product to a California buyer is distributing it into the state, and the sentence never asks where the seller sits.
Being outside California changes which rung names you, not whether one does: the brand rungs can only name someone who is in the state under that regulation and owns or is licensed on the brand; if nobody in the state fits those two rungs, this one names you because the goods go in.
No CalRecycle page and no provision of SB 54 or 14 CCR we read on September 7, 2026 sets a lighter standard for an out-of-state seller: none of the exemptions CalRecycle lists turns on where the seller is located.
Does the small-producer exemption cover you?
There is a size door, and it is narrower than it sounds. CalRecycle states the threshold in gross annual sales and, in the same breath, names the one duty the door does not open. The statute behind that summary measures those sales in California: subject to subparagraph (B), PRC 42060(a)(5)(A) directs the department to exempt producers that in the most recent calendar year had gross sales of less than $1 million in the state.
Small producers with gross annual sales of less than $1 million may apply to be exempt from most of the law's reporting and fee requirements. However, they need to plan for long-term compliance to ensure all packaging they sell is recyclable or compostable by 2032.
Two words there do the work. May apply means this is something you file for: register in PEPRS as a Packaging EPR producer first, then submit the small producer exemption application under 14 CCR section 18980.5.2.
CalRecycle also describes these as temporary, renewable exemptions, so an approved application has to be renewed rather than won once — and the 2032 recyclable-or-compostable requirement stays with you either way.
Which SB 54 dates have passed, and what is next?
SB 54 is phased, and producer deadlines are already behind you — the first of them set by the statute for January 1, 2024.
One of them closed a shelf. EPS foam food service ware had to show a 25% recycling rate as of January 1, 2025; CalRecycle says the requirement has not been met, so producers are prohibited from selling, offering for sale, distributing or importing it in or into California.
What are your three compliance paths under SB 54?
CalRecycle's producer guidance says producers must take one of three routes: apply to participate in the PRO plan run by Circular Action Alliance, submit an independent producer application (it needs a CalRecycle-approved plan under 14 CCR section 18980.7 and a recycling-rate record a typical store cannot show), or obtain a small producer exemption.
If you are already registered under the EU packaging rules, that is a separate scheme with its own registration and its own thresholds — our EU packaging guide answers whether those rules apply to your store.
For a producer that is not exempt, the bar on selling covered materials outside an approved plan lands on plan approval or January 1, 2027, whichever is sooner — and the exemption route itself starts in PEPRS, as above.
One deadline is already behind that: 14 CCR 18980.5(b) gave each producer 30 days after May 1, 2026 to apply to join an approved PRO or to be an independent producer, and an entity that becomes a producer after those 30 days but before January 1, 2027 applies within 30 days of becoming one.
This article was written entirely by AI under human editorial direction. The editor sets the topic and structure, runs multi-stage validation on facts, links, and interactive elements, and verifies the output is useful from a business perspective. All claims are checked against official Shopify sources. Details may change — always confirm critical data at shopify.com.
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