CARB Climate Disclosure Laws Updates: CARB Enforcement Advisory For SB 261 And Docket Opening; Expected Deadline For SB 253

On December 1, 2025, the California Air Resources Board (CARB) provided multiple updates regarding its implementation of Senate Bill (SB) 261 following the U.S. Court of Appeals for the Ninth Circuit's order staying enforcement of SB 261 pending appeal. SB 261 requires covered entities to publish biennial climate-related financial risk reports. CARB has also recently provided updates on SB 253, which requires scope 1, 2, and 3 greenhouse gas emissions disclosures.

Key Takeaways

• SB 261 reports will not be due unless and until the Ninth Circuit's enforcement stay pending appeal is lifted, likely on or after January 9, 2026.
• CARB intends to provide further guidance, including a new reporting deadline, after the Ninth Circuit appeal is resolved.
• CARB's SB 261 docket for filing of the climate-related financial risk reports is now open and will remain open until July 1, 2026.
• When determining if your company "does business in California," CARB will evaluate the entity's domicile and California sales, but not California property or payroll expenses.
• CARB will propose August 10, 2026, as the initial deadline for SB 253 scope 1 and 2 emissions reporting.

SB 261 Enforcement Advisory

CARB published an enforcement advisory, stating that "CARB will not enforce [SB 261] against covered entities for failing to post and submit reports by the January 1, 2026, statutory deadline" in light of the Ninth Circuit's recent order staying SB 261 enforcement pending appeal.¹ That case is scheduled for oral argument on January 9, 2026. CARB noted that it will "provide further information — including an alternate date for reporting, as appropriate — after the appeal is resolved."

SB 261 Public Docket

In addition to the enforcement advisory, CARB opened the public docket for covered entities to submit their biennial climate-related financial risk reports.² Under SB 261, covered entities must post their reports on their own websites in addition to uploading a copy to CARB's docket. CARB's docket will remain open until July 1, 2026.

Guidance on "Does Business in California"

The docket opening and enforcement advisory follow CARB's November 18 workshop³ during which the agency provided updates on its planned implementation of SB 261 (as well as SB 253, related to reporting greenhouse gas emissions data). At that workshop, CARB stated its intention to narrow what constitutes "do[ing] business in California," — a key applicability criterion — to include only a portion of the similar definition from the California Revenue and Tax Code. Under that provision, an entity is "doing business" in California if it is (1) organized or commercially domiciled in California or (2) has sales in California exceeding approximately $760,000 (adjusted annually for inflation) for the applicable reporting year (here, 2025).

Previously, CARB had planned to incorporate the full definition, which would have captured entities with certain amounts of real and personal property in the state, or entities with certain payroll expenses in the state. Based on the November workshop, CARB has indicated that it no longer plans to include California property and payroll as criteria for "do[ing] business in California" for purposes of California's climate disclosure laws, including SB 261 and SB 253.

Guidance on SB 253 Implementation

During its November workshop, CARB also provided updates on SB 253, which beginning in 2026, will require entities to disclose annually their scope 1 and scope 2 greenhouse gas emissions data, with scope 3 annual disclosures required beginning in 2027.

CARB intends to propose an August 10, 2026, deadline for the initial reports, and will conduct additional rulemaking next year to establish deadlines for 2027 reporting. During the workshop, CARB staff stated that entities need not provide any new data to comply with the first reporting deadline. In other words, entities can provide scope 1 and 2 emissions data that they had from existing reports, but if the entity was not collecting and did not plan on collecting emissions data as of CARB's December 5, 2024, enforcement notice,⁴ then the entity is not expected to submit scope 1 and scope 2 reporting data in 2026. Instead, the entity should "submit a statement on company letterhead to CARB" explaining that, in accordance with the December 2024 enforcement notice, it is not submitting a report.

Finally, CARB clarified that no assurances are required for the initial SB 253 reporting in 2026.

Practical Strategies for Next Steps

CARB appears to have heard covered entities' concerns about compliance with SB 261 and 253, both with respect to reporting deadlines and the substance of what is expected to be submitted. As such, covered entities should continue to track the evolving timeframe for reporting, and should understand the minimum compliance expectations.

Footnotes

1. Cal. Air Res. Bd., ENFORCEMENT ADVISORY, Climate-Related Financial Risk Reporting (SB 261), Dec. 1, 2025, https://ww2.arb.ca.gov/sites/default/files/2025-12/Dec%201%20SB%20261%20Enforcement%20Advisory.pdf; see Foley & Lardner, Ninth Circuit Stays Enforcement of California Climate Disclosure Law SB 261 Pending Appeal, Nov. 20, 2025, https://www.foley.com/p/102lvh4/ninth-circuit-stays-enforcement-of-california-climate-disclosure-law-sb-261-pendi/.

2. Cal. Air Res. Bd., Climate-Related Financial Risk Reports (SB 261) Docket, last visited Dec. 2, 2025, https://ww2.arb.ca.gov/public-comments/climate-related-financial-risk-reports-sb-261-docket.

3. Cal. Air. Res. Bd., SB 253/261/219 Public Workshop: Update on California Corporate Greenhouse Gas Reporting and Climate-Related Financial Risk Disclosure Programs, Nov. 18, 2025, https://ww2.arb.ca.gov/sites/default/files/classic/SB%20253%20261%20Nov%20Workshop%20slides_v2.pdf.

4. Cal. Air. Res. Bd., The Climate Corporate Data Accountability Act, ENFORCEMENT NOTICE, Dec. 5, 2024, https://ww2.arb.ca.gov/sites/default/files/2024-12/The%20Climate%20Corporate%20Data%20Accountability%20Act%20Enforcement%20Notice%20Dec%202024.pdf.

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