Exporting to California? A Practical Guide to Proposition 65 and Its Litigation Traps

California Proposition 65, formally the Safe Drinking Water and Toxic Enforcement Act of 1986 (Proposition 65, or Prop 65), is a state-level statute of California. It pursues two objectives: to protect California's drinking water sources from contamination by toxic substances, and to safeguard the public's right to know — where a product could cause human exposure to a listed chemical under reasonably foreseeable use, the business must provide a clear and reasonable warning.

One premise is easily overlooked: Proposition 65 sets no uniform material content ban. Whether a warning is required depends on the actual daily human exposure dose, not on the mere level of a substance in the product.

1. What Proposition 65 covers

Proposition 65 is not limited by product category. All commercial goods sold into California are subject to it; beyond finished products, components, raw materials and packaging are also covered, spanning the entire supply chain. Regardless of where a product is manufactured, once it enters California for commercial B2B or B2C sale, compliance obligations apply.

The statute also binds the production end, prohibiting the discharge of listed chemicals into water or soil in ways that could contaminate drinking water sources.

2. Key points on regulated chemicals

The list of regulated substances is maintained and continuously updated by California's OEHHA (Office of Environmental Health Hazard Assessment). It currently contains more than 960 chemicals known to cause cancer or reproductive toxicity, and is expanded from time to time. In July 2026, OEHHA added four carcinogens to the list: hydrochlorothiazide, tacrolimus, voriconazole and welding fumes.

For listed substances, OEHHA has issued safe-harbor exposure thresholds — NSRL (No Significant Risk Level) for carcinogens and MADL (Maximum Allowable Dose Level) for reproductive toxicants — for only about 300 substances. The remaining 700-plus have no official safe-harbor reference values.

A particular caution: content limits agreed in past litigation settlements bind only the companies that signed those settlements. They are not a statutory general standard, and companies cannot use them directly as a basis for declaring a product compliant. Lead, cadmium, phthalates, bisphenol A and polycyclic aromatic hydrocarbons (PAHs) are the chemicals most frequently involved in recent lawsuits.

Material content testing therefore does not equal full compliance. Companies can combine targeted screening for high-risk substances with supply chain control to identify risk, based on their own materials and use scenarios.

3. Exemptions

Proposition 65 exemptions fall into two types — entity exemptions and scenario exemptions. Note that an exemption removes only certain obligations; it does not exempt a product entirely.

Small business entity exemption

Businesses with fewer than 10 employees may be exempt from the product warning label obligation. But this exemption applies only to the business entity: discharge control obligations for water sources still apply, and the legal risk arising from regulated chemicals contained in the product itself is not fully removed. If a product causes exposure to a harmful substance and triggers a dispute, the business still bears the corresponding legal liability. If the company's size changes, eligibility must be re-assessed.

Scenario exemption (no-exposure exemption)

A business may be exempt from the warning label if it can fully demonstrate that no reasonably foreseeable route of human exposure exists during storage, use or disposal across the product's entire lifecycle. The key boundary: an entity exemption is not a product exemption. Exemptions remove specific obligations only, and do not mean a product is unregulated. There is no general exemption by broad product category under the statute, and exemption clauses from other regions' regulations cannot be applied directly to determine Proposition 65 compliance.

4. Business obligations

There are two main compliance routes.

• Exposure assessment based on test data: for substances with an official safe harbor, an exposure assessment based on test data can demonstrate exposure below the threshold and, with records retained, allow the product to be sold without a warning label. For substances without an official safe harbor, self-established threshold defenses carry a relatively high risk of not being accepted.

• Compliant warning labels: produce warnings strictly following OEHHA's official specifications and display them on the product itself, the outer packaging, and the online e-commerce detail page.

The statute has a distinctive private enforcement mechanism: private organizations and law firms may issue a 60-day notice of violation to a business, and a single violation can carry a civil penalty of up to USD 2,500 per day. Many companies end up settling out of court, but a settlement does not confirm that the product is compliant and does not prevent other parties from bringing new claims.

5. Recommendations from MTT

Proposition 65-related litigation has risen year on year, and cross-border platforms have made it an important review condition for product listing. Companies need to track OEHHA list updates continuously and manage supply chain risk; based on their actual products, they should choose between a professional risk assessment or compliant warning labels. A 60-day notice must not be ignored — engage a professional lawyer promptly.

MTT has a professional chemical compliance technical team that can support companies in targeted screening for high-risk Proposition 65 substances, providing regulatory list interpretation, sample testing and test data analysis, and delivering reliable test data for internal risk assessment — helping exporters identify chemical risks in their products and meet California market compliance challenges with confidence.

Reference: California Proposition 65 official website https://www.p65warnings.ca.gov/business-resources/frequently-asked-questions-businesses

Disclaimer: This article provides regulatory interpretation and technical information for educational purposes. Regulatory requirements are subject to official announcements; it does not constitute legal advice.