Digital Product Passports: Transforming America’s Linear Economy to Combat Waste, Counterfeits, and Supply Chain Vulnerabilities
The U.S. economy is being held back by outdated, linear supply chains that waste valuable materials, expose businesses to counterfeits, and limit consumer choice. American companies lose billions each year to fraudulent goods—everything from fake pharmaceuticals to faulty electronics—while consumers are left in the dark about what they’re buying. At the same time, global disruptions like the COVID-19 pandemic revealed just how fragile and opaque our supply chains really are, especially in critical industries. Without greater transparency and accountability, the U.S. economy will remain vulnerable to these risks, stifling growth and innovation while perpetuating inequities and environmental harm.
A shift toward more circular, transparent systems would not only reduce waste and increase efficiency, but also unlock new business models, strengthen supply chain resilience, and give consumers better, more reliable information about the products they choose. Digital Product Passports (DPP) – standardized digital records that contain key information about a product’s origin, materials, lifecycle, and authenticity – are a key tool that will help the United States achieve these goals.
The administration should establish a comprehensive Digital Product Passport Initiative that creates the legal, technical, and organizational frameworks for businesses to implement decentralized digital passports for their products while ensuring consumer ownership rights, supply chain integrity, and international interoperability. This plan should consider which entities provide up-front investment until the benefits of a digital product passport (DPP) are manifested.
Challenge and Opportunity
The United States faces an urgent sustainability challenge driven by its linear economic model, which prioritizes resource extraction, production, and disposal over reuse and recycling. This approach has led to severe environmental degradation, excessive waste generation, and unsustainable resource consumption, with marginalized communities—often communities of color and low-income areas—bearing the brunt of the damage. From toxic pollution to hazardous waste dumps, these populations are disproportionately affected, exacerbating environmental injustice. If this trajectory continues, the U.S. will not only fall short of its climate commitments but also deepen existing economic inequities. To achieve a sustainable future, the nation must transition to a more circular economy, where resources are responsibly managed, reused, and kept in circulation, rather than being discarded after a single use.
At the same time, the U.S. is contending with widespread counterfeiting and fragile supply chains that threaten both economic security and public health. Counterfeit goods, from unsafe pharmaceuticals to faulty electronics, flood the market, endangering lives and undermining consumer confidence, while costing the economy billions in lost revenue. Furthermore, the COVID-19 pandemic exposed deep weaknesses in global supply chains, particularly in critical sectors like healthcare and technology, leading to shortages that disproportionately affected vulnerable populations. These opaque and fragmented supply chains allow counterfeit goods to flourish and make it difficult to track and verify the authenticity of products, leaving businesses and consumers at risk.
Achieving true sustainability in the United States requires a shift to item circularity, where products and materials are kept in use for as long as possible through repair, reuse, and recycling. This model not only minimizes waste but also reduces the demand for virgin resources, alleviating the environmental pressures created by the current linear economy. Item circularity helps to close the loop, ensuring that products at the end of their life cycles re-enter the economy rather than ending up in landfills. It also promotes responsible production and consumption by making it easier to track and manage the flow of materials, extending the lifespan of products, and minimizing environmental harm. By embracing circularity, industries can cut down on resource extraction, reduce greenhouse gas emissions, and mitigate the disproportionate impact of pollution on marginalized communities.
One of the most powerful tools to facilitate this transition is the digital product passport (DPP). A DPP is a digital record that provides detailed information about a product’s entire life cycle, including its origin, materials, production process, and end-of-life options like recycling or refurbishment. With this information easily accessible, consumers, businesses, and regulators can make informed decisions about the use, maintenance, and eventual disposal of products. DPPs enable seamless tracking of products through supply chains, making it easier to repair, refurbish, or recycle items. This ensures that valuable materials are recovered and reused, contributing to a circular economy. Additionally, DPPs empower consumers by offering transparency into the sustainability and authenticity of products, encouraging responsible purchasing, and fostering trust in both the products and the companies behind them.
In addition to promoting circularity, digital product passports (DPPs) are a powerful solution for combating counterfeits and ensuring supply chain integrity. In 2016, counterfeits and pirated products represented $509B and 3.3% of world trade. By assigning each product a unique digital identifier, a DPP enables transparent and verifiable tracking of goods at every stage of the supply chain, from raw materials to final sale. This transparency makes it nearly impossible for counterfeit products to infiltrate the market, as every legitimate product can be traced back to its original manufacturer with a clear, tamper-proof digital record. In industries where counterfeiting poses serious safety and financial risks—such as pharmaceuticals, electronics, and luxury goods—DPPs provide a critical layer of protection, ensuring consumers receive authentic products and helping companies safeguard their brands from fraud.
Moreover, DPPs offer real-time insights into supply chain operations, identifying vulnerabilities or disruptions more quickly. This allows businesses to respond to issues such as production delays, supplier failures, or the introduction of fraudulent goods before they cause widespread damage. With greater visibility into where products are sourced, produced, and transported, companies can better manage their supply chains, ensuring that products meet regulatory standards and maintaining the integrity of goods as they move through the system. This level of traceability strengthens trust between businesses, consumers, and regulators, ultimately creating more resilient and secure supply chains.
Beyond sustainability and counterfeiting, digital product passports (DPPs) offer transformative potential in four additional key areas:
- First, they enhance compliance and regulatory oversight by providing clear, accessible records of a product’s materials, production methods, and supply chain journey, helping industries meet environmental, labor, and safety standards.
- Second, DPPs strengthen supply chain risk mitigation and resilience by improving real-time visibility and accountability, allowing businesses to detect and address disruptions or vulnerabilities faster.
- Third, they empower informed consumer choices and consumer protection by offering transparency into a product’s origin, sustainability, and authenticity, enabling people to make ethical, safe purchasing decisions.
- Finally, DPPs fuel data-driven innovation and new business models by generating insights that can inform better product design, maintenance strategies, and circular economy opportunities, such as take-back programs or leasing services. In these ways, DPPs act as a versatile tool that not only addresses immediate challenges but also positions industries for long-term, sustainable growth.
Plan of Action
The administration should establish a comprehensive Digital Product Passport Initiative that creates the legal, technical, and organizational frameworks for businesses to implement decentralized digital passports for their products while ensuring consumer ownership rights, supply chain integrity, and international interoperability. This plan should consider which entities provide up-front investment until the benefits of DPP are realized.
Recommendation 1. Legal Framework Development (Lead: White House Office of Science and Technology Policy)
The foundation of any successful federal initiative must be a clear legal framework that establishes authority, defines roles, and ensures enforceability. The Office of Science and Technology Policy is uniquely positioned to lead this effort given its cross-cutting mandate to coordinate science and technology policy across federal agencies and its direct line to the Executive Office of the President.
- Draft executive order establishing federal DPP program authority
- Coordinate with Department of Commerce (DOC) and Environmental Protection Agency (EPA) to identify rulemaking authority, engaging Congress as needed
- Define enforcement mechanisms and penalties
- Coordinate with DOC to define legal requirements for DPP data portability
- Establish liability framework for DPP data accuracy
- Create legal framework for consumer DPP ownership rights, engaging Congress as needed
- Identify the role of Congress, if needed; for example, in defining rulemaking authorities, DPP data probabilities, and consumer DPP ownership rights
- Timeline: First 9 months
Recommendation 2. Product Category Definition & Standards Development (Lead: DOC/NIST)
The success of the DPP initiative depends on clear, technically sound standards that define which products require passports and what information they must contain. This effort must consider the industries and products that will benefit from DPPs, as goods of varying value will find different returns on the investment of DPPs. NIST, as the nation’s lead standards body with deep expertise in digital systems and measurement science, is the natural choice to lead this critical definitional work.
- Establish an interagency working group led by NIST to define priority product categories
- Develop technical standards for DPP data structure and interoperability
- Timeline: First 6 months
Recommendation 3. Consumer Rights & Privacy Framework (Lead: FTC Bureau of Consumer Protection)
A decentralized DPP system must protect consumer privacy while ensuring consumers maintain control over the digital passports of products they own. The FTC’s Bureau of Consumer Protection, with its statutory authority to protect consumer interests and experience in digital privacy issues, is best equipped to develop and enforce these critical consumer protections.
- Define consumer DPP ownership rights and transfer mechanisms
- Establish privacy standards for DPP data
- Develop consumer access and control protocols
- Create standards for consumer authorization of third-party DPP access
- Define requirements for consumer notification of DPP changes
- Timeline: 12-18 months
Recommendation 4. DPP Architecture & Verification Framework (Lead: GSA Technology Transformation Services)
A decentralized DPP system requires robust technical architecture that enables secure data storage, seamless transfers, and reliable verification across multiple private databases. GSA’s Technology Transformation Services, with its proven capability in building and maintaining federal digital infrastructure and its experience in implementing emerging technologies across government, is well-equipped to design and oversee this complex technical ecosystem.
- Define methodology for storing and verifying DPPs
- Develop API standards for industry integration
- Ensure cybersecurity protocols meet NIST standards
- Implement blockchain or distributed ledger technology for traceability
- Develop standards for DPP transfer between product clouds
- Create protocols for consumer DPP ownership transfer
- Establish verification registry for authorized product clouds
- Define minimum security requirements for private DPP databases
- Timeline: 12-18 months
Recommendation 5. Industry Engagement & Compliance Program (Lead: DOC Office of Business Liaison)
Successful implementation of DPPs requires active participation and buy-in from the private sector, as businesses will be responsible for creating and maintaining their product clouds. The DOC Office of Business Liaison, with its established relationships across industries and experience in facilitating public-private partnerships, is ideally suited to lead this engagement and ensure that implementation guidelines meet both government requirements and business needs.
- Create industry advisory board with representatives from key sectors
- Develop compliance guidelines and technical assistance programs
- Establish pilot programs with volunteer companies
- Partner with trade associations for outreach and education
- Develop guidelines for product cloud certification
- Create standards for DPP ownership transfer during resale
- Establish protocols for managing orphaned DPPs
- Timeline: Ongoing from months 3-24
Recommendation 6. Supply Chain Verification System (Lead: Customs and Border Protection)
Digital Product Passports must integrate seamlessly with existing import/export processes to effectively combat counterfeiting and ensure supply chain integrity. Customs and Border Protection, with its existing authority over imports and expertise in supply chain security, is uniquely positioned to incorporate DPP verification into its existing systems and risk assessment frameworks.
- Integrate DPP verification into existing Customs and Border Protection systems
- Develop automated scanning and verification protocols
- Create risk assessment frameworks for import screening
- Timeline: 18-24 months
Recommendation 7. Sustainability Metrics Integration (Lead: EPA Office of Pollution Prevention)
For DPPs to meaningfully advance sustainability goals, they must capture standardized, verifiable environmental impact data throughout product lifecycles. The EPA’s Office of Pollution Prevention brings decades of expertise in environmental assessment and verification protocols, making it the ideal leader for developing and overseeing these critical sustainability metrics.
- Define required environmental impact data points
- Develop lifecycle assessment standards
- Create verification protocols for environmental claims
- Timeline: 12-18 months
Recommendation 8. International Coordination (Lead: State Department Bureau of Economic Affairs)
The global nature of supply chains requires that U.S. DPPs be compatible with similar initiatives worldwide, particularly the EU’s DPP system. The State Department’s Bureau of Economic Affairs, with its diplomatic expertise and experience in international trade negotiations, is best positioned to ensure U.S. DPP standards align with global frameworks while protecting U.S. interests.
- Survey and coordinate with similar efforts around the world (e.g., European Commission’s Digital Product Passport initiative)
- Engage with WTO to ensure compliance with trade rules
- Develop framework for international data sharing
- Develop protocols for cross-border DPP transfers
- Establish international product cloud interoperability standards
- Timeline: Ongoing from months 6-24
Recommendation 9. Small Business Support Program (Lead: Small Business Administration)
The technical and financial demands of implementing DPPs could disproportionately burden small businesses, potentially creating market barriers. The Small Business Administration, with its mandate to support small business success and experience in providing technical assistance and grants, is the natural choice to lead efforts ensuring small businesses can effectively participate in the DPP system.
- Create technical assistance programs
- Provide implementation grants
- Develop simplified compliance pathways
- Timeline: Launch by month 18
Conclusion
Digital Product Passports represent a transformative opportunity to address two critical challenges facing the United States: the unsustainable waste of our linear economy and the vulnerability of our supply chains to counterfeiting and disruption. Through a comprehensive nine-step implementation plan led by key federal agencies, the administration can establish the frameworks necessary for businesses to create and maintain digital passports for their products while ensuring consumer rights and international compatibility. This initiative will not only advance environmental justice and sustainability goals by enabling product circularity, but will also strengthen supply chain integrity and security, positioning the United States as a leader in the digital transformation of global commerce.
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