What happened

On 9 November 2026, the day before the first SB 253 reports were due, the US Court of Appeals for the Ninth Circuit published its opinion in the case brought by the US Chamber of Commerce and other business groups against the California Air Resources Board (CARB). The ruling was first reported by Carbon Pulse. The court split the two laws:

  • SB 253 Scope 1 and Scope 2: still in force. The court held these are commercial speech, because they require factual figures about a company's own operations, and that California is likely to justify them. It upheld the lower court's refusal to block them.
  • SB 253 Scope 3: likely unconstitutional. Because Scope 3 covers emissions from "diffuse third-party conduct in the value chain", the court held it is not commercial speech, applied strict scrutiny, and found it likely fails. It sent the case back to the district court to decide whether Scope 3 can be cut out of the law.
  • SB 261, the climate risk reporting law: likely unconstitutional in its entirety, because it requires companies to give what the court called "subjective ideological assessments" of climate risk.

One of the three judges, Judge Bennett, agreed in part and dissented in part: he would have blocked both laws in full. The ruling is on a preliminary injunction, so the case itself goes on.

What it means for your business

The first Scope 1 and 2 reports go ahead. As we explained in our post on the 10 November deadline, SB 253 covers US companies with over $1 billion in revenue that do business in California, and the first year only asks for Scope 1 and Scope 2. Those emissions count "regardless of location", so a UK subsidiary inside a covered US group's boundary is still likely to be asked for its gas, fuel and electricity figures.

The push for supplier data from 2027 is weaker, but not gone. The main way SB 253 would have reached UK suppliers was through US customers collecting Scope 3 from 2027. With that part likely blocked, the legal reason falls away for now. Many of the same customers still ask for supplier figures for their own targets, for CDP supply chain requests and for the EU's rules, so a request may still come.

What to do now

  1. If you are part of a covered US group, carry on: your group's Scope 1 and 2 report is still due, and check CARB's SB 253 page for any change.
  2. If you supply US companies, keep your Scope 1 and 2 figures ready by year. They are the first thing any customer asks for, with or without SB 253.
  3. Don't count on Scope 3 being gone. The district court still has to rule, and California may appeal. We will report the next decision.

Worked example: your share for a US customer

Take a UK supplier with 30,000 kWh of electricity and 50,000 kWh of gas a year. On the 2026 UK government conversion factors that is 3.93 tCO2e of Scope 2 and 9.12 tCO2e of Scope 1, 13.04 tCO2e in all. If a US customer buys £400,000 a year from turnover of £2,000,000, its share by revenue is 20%, or 2.61 tCO2e. That figure would have sat in the customer's SB 253 Scope 3 from 2027. Even with that part of the law likely blocked, it is the same figure a CDP supply chain request or the customer's own target will ask for.