Prove Environmental Claims or Face Penalties
Last week the European Commission proposed mandatory new rules to fight against greenwashing and help consumers to make decisions based on “transparent and reliable information on the sustainability, durability and carbon footprint of the products”.
The EU Green Claims Directive was proposed after research found that “more than half of environmental claims on products are misleading or unfounded in the EU, and 40% of claims do not have any evidence supporting their green credentials.”
Under the new laws (set to be implemented from 2024 to 2027), claims must now be verified by an accredited third party and based on scientific evidence and technical knowledge from a life cycle perspective and delivered before being used in commercial communication. There is no single method for making claims, but all claims must include company-specific data. Manual methods will no longer be valid, and environmental claims must be revisited every five years.
Failure to comply can result in a fine of at least 4% of a company’s annual turnover, confiscation of revenue gained from related products, ban from access to public funding, and up to 12-month exclusion from public procurement processes.
Member states will be responsible for enforcing the EU Green Claims Directive, which applies to all businesses selling in the EU, with the expectation of micro-enterprises with an annual turnover of less than €2 million and fewer than ten employees. Despite being “exempt from the obligations of the proposals, all traders remain within the scope of the Unfair Commercial Practices Directive”, which means that consumers affected by any claims can make complaints and seek legal action.
A Eurobarometer survey published in 2020 showed that 94% of EU citizens found environmental protection important to them, and 91% identified climate change as an important issue in the EU.
Much remains unclear about how these rules will be enforced, but consumers can soon proceed in confidence that environmental claims made by companies are accurate and substantiated.
Key Takeaways
- Environmental claims must be truthful, accurate and substantiated by scientific evidence.
- Claims should not be misleading and should not exaggerate the environmental benefits of a product or service.
- Claims should be based on a life cycle assessment that takes into account the environmental impact of the entire product or service, including raw materials, production, use and disposal.
- Claims must be specific and not vague or general, and they should be accompanied by clear and prominent information on the environmental impact of the product or service.
- Claims must be comparable with similar products or services in the same category, and companies should not use terms such as “eco-friendly” or “green” unless they can demonstrate a significant environmental benefit.
- The directive prohibits the use of symbols or graphics that may mislead consumers about the environmental impact of a product or service.
- The responsibility for ensuring that environmental claims are accurate and truthful rests with the company making the claim.
Read the full proposal here.
