Who Is a Producer Under EPR? The 3-Tier System Explained
May 18, 2026 · 8 min read
Under California's SB 54, the word “producer” doesn't mean what most people think. It's not just the manufacturer. It's not just the brand owner. It's a cascading 3-tier definition that determines who's legally responsible for EPR compliance — and the tier you fall into depends on who else is in the chain.
CalRecycle published an official “Are You a Producer?” flowchart in May 2026 that lays this out. Here's what each tier means, with examples, and what to do once you know your tier.
Why this matters
Only one entity per product is the “producer” under EPR law. If you're a Tier 1 producer, you owe compliance obligations. If someone else qualifies as Tier 1, they owe — not you. Getting this wrong means either paying fees you don't owe, or skipping obligations that carry penalties up to $50,000/day in California.
The 3 tiers of producer determination
The tiers cascade. You check Tier 1 first. If no one qualifies as Tier 1, you check Tier 2. If no one qualifies as Tier 2, you check Tier 3. Only one tier applies per product — and the highest applicable tier wins.
Tier 1: Manufacturer or Trademark Owner
You manufactured the good that uses the covered material, or you own the trademark (brand) for the product.
Examples
- A cannabis company that manufactures its own pre-roll tubes — Tier 1 producer for those tubes.
- A supplement brand that owns the trademark and contracts out manufacturing — still Tier 1, because trademark ownership puts you here.
- A beverage company that makes and bottles its own drinks — Tier 1 for the bottle, cap, and label.
Key detail
If the trademark owner is in California, they are the Tier 1 producer — even if someone else manufactures the product. Trademark ownership trumps manufacturing when the owner is in-state.
Reference: 14 CCR §18980.1.1
Tier 2: Licensed Exclusive Seller (Distributor)
No Tier 1 producer exists (the trademark owner is out-of-state, or the manufacturer has no presence in CA). You hold an exclusive license to sell or distribute the product in California.
Examples
- A California-based distributor that has the exclusive right to sell an out-of-state brand's products in CA.
- A licensee who is the only party authorized to distribute a foreign brand's packaged goods in the state.
Key detail
The license must grant exclusive distribution rights in all or part of California. If the license was issued by a party already in-state, that party is the Tier 2 producer — not you. Also, if the trademark owner is in-state, they bump to Tier 1, and Tier 2 doesn't apply.
Reference: 14 CCR §18980.1.1
Tier 3: First Seller or Importer
No Tier 1 or Tier 2 producer exists. You are the first party to sell, offer for sale, or distribute the packaged product into California.
Examples
- An importer who brings an overseas brand's products into CA — and neither the manufacturer nor an exclusive licensee is in the state.
- A retailer that imports products directly when no US-based manufacturer, trademark owner, or exclusive distributor exists.
Key detail
Tier 3 is the catch-all. You only land here if neither the manufacturer/trademark owner (Tier 1) nor an exclusive licensee (Tier 2) has a presence in California. Tier 3 producers are responsible only for covered materials used by goods they themselves sold into the state.
Reference: 14 CCR §18980.1.1
How the tiers cascade
The tier system is sequential — it's not a pick-one situation. Think of it as a waterfall:
- Check Tier 1 first. Is there a manufacturer or trademark owner in California? If yes, they're the producer. Stop here.
- If no Tier 1 exists, check Tier 2. Is there a party with an exclusive license to sell or distribute the product in California? If yes, they're the producer.
- If neither Tier 1 nor Tier 2 exists, whoever first sold, offered for sale, or distributed the product into California is the Tier 3 producer.
One product. One producer. One obligation. The tier that applies is the highest one that has a qualifying entity in the chain.
Common tier scenarios
You're a California brand that manufactures its own packaging
Tier 1. You own the trademark and you manufacture. Full obligation.
You're a US brand, but an overseas manufacturer makes your product
Tier 1 — you own the trademark and you're in-state (or selling into CA). The contract manufacturer outside the US doesn't count.
You're a CA-based exclusive distributor for an out-of-state brand
Tier 2 — the trademark owner isn't in CA, but you have the exclusive license. You carry the obligation.
You import a foreign product with no US presence
Tier 3 — no manufacturer, trademark owner, or exclusive licensee in CA. You, as the first party to bring it in, are the producer.
You're a retailer just reselling someone else's branded product
Not a producer. The brand owner (Tier 1) or exclusive importer (Tier 2/3) holds the obligation. Retailers are generally exempt.
Is this only a California thing?
The 3-tier system is specific to California's SB 54 (Public Resources Code §42041 and 14 CCR §18980.1.1). Other EPR states — Oregon, Colorado, Minnesota, Maryland, Washington, and Maine — have their own producer definitions. Most follow a similar pattern (brand owner → licensee → first importer), but the specifics vary:
- Oregon (SB 582): Defines "producer" as the brand holder or first importer — similar cascading logic, but the statutory language differs.
- Colorado (HB 22-1355): "Producer" means the person who owns the brand or trademark, or if no US-based owner, the first importer into the state.
- Minnesota, Maryland, Washington, Maine: Each state has its own definition. Some tie obligation to revenue thresholds; others apply to all producers selling in-state.
The principle is the same everywhere: figure out who in the supply chain owes the obligation. California just gave it a formal 3-tier structure with explicit cascading rules. See all state guides →
Small producer exemptions
Even if you qualify as a producer, you may be exempt from compliance obligations based on revenue or volume thresholds:
- California: Small producers (under $1M in CA sales) are exempt from reporting and fee obligations — but still need to self-identify. Public Resources Code §42060(a)(5).
- Oregon: Under $5M global revenue — exempt from most obligations.
- Minnesota: De minimis exemption for producers under $1M revenue AND under 1 ton of packaging.
- Other states: Each has its own thresholds. Check the relevant guide.
Exemption doesn't mean you can ignore EPR. It means you don't owe fees — but you may still need to register or self-certify.
What to do next
Determine your tier
Use Am I Covered? to check which states you're obligated in. If you're a brand owner, licensee, or first importer — you're likely Tier 1, 2, or 3 respectively.
Register with the PRO
In California, register with Circular Action Alliance (CAA). Other states have their own PROs. Registration deadlines vary.
Estimate your fees
Your tier determines who pays. Your packaging weight and material type determine how much. Use the fee calculator →
Sources
- CalRecycle, “Are You a Producer?” Flowchart (May 8, 2026) — 14 CCR §18980.1.1
- CalRecycle, “Identifying Covered Materials: Guidance for Producers” (May 11, 2026)
- California Public Resources Code §42041(w) — definition of “producer”
- California Public Resources Code §42060(a)(5) — small producer exemption
Not sure which tier you fall into?
Our free Am I Covered? tool walks you through the producer question step by step — for every state where you sell.