California’s Compostable Labeling Requirement Delayed, Varying Compostable Requirements in State’s Laws Questioned
California AB 1201 specifies that, as of January 1, 2026, products may not be labeled as “compostable” or “home compostable” in California unless, among other things, they are “an allowable agricultural organic input under the requirements of the United States Department of Agriculture National Organic Program [NOP].” While this requirement applies to any material that meets AB 1201’s broad definition of a “product,” the law principally affects plastic and plastic-coated products.
However, on June 11, 2025, the California Department of Resources Recycling and Recovery (CalRecycle) sent a letter to the Biodegradable Products Institute (BPI) that effectively delays the compostable and home compostable labeling requirement until June 30, 2027, for products that contain synthetic substances but otherwise satisfy all requirements for lawfully being labeled “compostable.” After that date, companies must revise labeling for their “compostable” and “home compostable” products sold in California that are not listed as an allowable agricultural organic input under the requirements of the USDA NOP, unless CalRecycle grants a further exemption.
California’s compostable and home compostable labeling requirement could have further implications beyond AB 1201 since the requirement for products to be compostable is incorporated in other California legislation. For example, California’s Plastic Pollution Producer Responsibility Act, SB 54, which, in addition to establishing the state's Extended Producer Responsibility (EPR) law for packaging, requires products to meet source reduction, recyclability, or composability requirements by specific deadlines. The law also requires CalRecycle to publish a Covered Materials Categories (CMC) List that establishes a framework to evaluate the recyclability and compostability of materials. Finally, the law requires that all packaging be recyclable or compostable by 2032.
On June 23, CalRecycle held a Non-Regulatory Workshop to discuss Covered Materials Categories (CMC) and Source Reduction Baseline Reporting Guidance. During that meeting, CalRecycle stated that AB 1201 and SB 54 were not connected, and that SB 54 contains its own statutory requirements to be considered compostable, separate from AB 1201. CalRecycle distinguished the two laws by stating that AB 1201 addresses labeling for compostable products, while SB 54 addresses whether a product is compostable or recyclable. However, stakeholders insisted that the compostability criteria in SB 54 are intimately tied to AB 1201 and that the “allowable organic input” language only comes in through AB 1201. It remains to be seen how CalRecycle’s delay of the compostable and home compostable labeling requirement under AB 1201 will impact California’s implementation of SB 54.