EU to Ban Greenwashing and Generic Climate Claims
The use of generic environmental and climate claims which are not based on fact and supported by evidence will be banned in the EU by 2026 and added to the list of unfair commercial practice, under new legislation agreed by EU legislators.
The legislation, which amends existing EU commercial law, will also mean that terms such as “climate neutral”, “CO2 neutral certified”, “carbon positive”, “climate net zero” and “limited CO2 footprint” among others will be banned outright. Those terms “mislead consumers by making them believe that such claims relate to the product itself, or the supply and production of that product, or as they give the false impression to consumers that the consumption of that product has no environmental impact, while this is not the case”, according to the text of the draft agreement reached in negotiations.
The requirements of the law are quite stringent. Any claims in respect to the environment, climate-related claims, and claims relating to the transition to carbon or climate neutrality will need to be backed up by “objective, publicly available and verifiable commitments and targets given by the trader”.
These will need to be:
* set out in a detailed and realistic implementation plan that shows how these commitments and targets will be achieved and allocates resources to this end;
* set out in an implementation plan that includes all the relevant elements necessary to fulfil the commitments, such as budgetary resources and technological developments, where appropriate and in accordance with EU law;
* verified by a third party expert, who should be independent from the trader, free from any conflicts of interest, with experience and competence in environmental issues and who should be enabled to monitor regularly the progress of the trader with regard to the commitments and targets, including the milestones for achieving them;
* and those regular third party expert findings will need to be made available to consumers.
In addition:
* any sustainability label will need to meet minimum conditions of transparency and credibility, including the existence of an objective monitoring of compliance with the requirements of the certification scheme concerned;
* only sustainability labels based on approved certification schemes or established by public authorities will be allowed;
* product guarantee information will have to be more visible and a new guarantee extension label will be introduced;
* and the use of general environmental claims like “environmentally friendly”, “natural”, “biodegradable”, “climate neutral” or “eco” without proof will be banned.
The European Commission will be tasked with designing a new label for producers willing to highlight the quality of their goods by extending the guarantee period free of charge.
A range of unfair commercial practices are already banned at EU level and arguably some climate or environmental misleading claims may already be covered. However, this new legislation clarifies this and adds greenwashing as well as the early obsolescence of goods to the EU list of banned commercial practices.
Under the Directive 2005/29/EC Unfair Commercial Practices Directive, which this legislation amends, member states can determined the rules on penalties applicable for breach. Member states are also responsible for enforcement practices.
The directive now needs to receive final approval from the Council, after which it will enter into force. Member states will have 24 months to transpose it into national law.