Environmental claims on products are becoming increasingly popular for businesses trying to lure eco-conscious consumers. It's a trend which shows no sign of slowing, given the anticipated growth of the green economy. But the European Commission has concerns about how these claims are being substantiated, with more than 200 environmental labels active in the EU, and 450 active worldwide. The Commission is therefore taking action to help consumers make sense of sustainability claims and has launched a public consultation to gather views on proposed measures to require companies to substantiate environmental claims on products. Businesses that use green claims should think about whether they want to take part in the consultation.
The Commission has identified issues with green claims
As part of its 2020 Circular Economy Action Plan, the Commission has identified that current green claims are confusing for consumers. There is a multitude of voluntary initiatives in the EU, and around the world, and comparing and contrasting them is challenging for consumers.
The Commission has also highlighted the problem of "greenwashing", whereby businesses present a false impression of a product's environmental impact or benefits. The Commission is concerned that greenwashing not only misleads consumers, but leads to low levels of confidence in the environmental credentials of businesses, overall leading to a less green economy. Currently, these claims can be prohibited because they are misleading e.g. under the Unfair Commercial Practices Directive. In addition, there are a number of self-regulatory advertising regimes across the EU which can take action in the event a claim which amounts to advertising is misleading. But there is no positive EU regulation specific to the substantiation of environmental claims*.
Addressing the issue
To address these concerns, the Commission is proposing to replace the current position of more than 200 voluntary environmental labels in the EU with a single standard that is easy for consumers to understand, and against which all environmental claims for products and services can be judged.
Details of the consultation
The exact form for this action by the Commission has not yet been determined, which means there is no clear timeline for its adoption. However, those wishing to share their views with the Commission on their proposals should consider the consultation, which closes on 3 December 2020, and is available here. This consultation is particularly relevant for businesses who envisage green claims being something that they will want to use in the future for their products, because this will shape the substantiation methods those businesses will need to follow in order to use those claims – clearly, being involved at an early stage.
The UK's position
In light of Brexit, it isn't clear yet how keenly the UK will watch the results and resulting regime changes that come from this consultation. However, the UK Government does take this topic seriously and has issued guidance on making green claims which can be found here, together with the UK advertising code's rules on environmental claims which can be found here.
* NB the Commission has been considering this for a while, there's an interesting Consumer Market Study on Environmental Claims for Non-Food Products concluded in July 2014 which can be found here which looked at the then current position in a number of EU Member States.=
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