EU Takes Action Against Greenwashing with New Directive

In March 2023, the EU Commission proposed a Directive on Green Claims, aiming to establish reliability, comparability, and verifiability standards for environmental assertions made by businesses.

The directive targets explicit green claims voluntarily made by companies, covering aspects like product packaging, environmental footprints, and emissions reductions. Under the proposed law, companies must substantiate their claims using robust, science-based methods. This decision is in light of a recent study by finding that more than half of green claims by companies in the EU were vague or misleading, and 40% were completely unsubstantiated.

This directive prohibits unproven generic claims such as “environmentally friendly” or “climate neutral,” along with marketing based on emissions offsetting schemes.

Key objectives of the directive include:

• facilitating informed consumer choices
• creating a level playing field for environmental product performance
• advancing a circular and green economy within the EU

To achieve these goals, the proposal outlines clear criteria for companies to prove their environmental claims and labels. It mandates independent and accredited verification of these assertions, ensuring transparency and reliability. Additionally, new governance rules for environmental labelling schemes are proposed to enhance credibility.

In response to Parliament’s adopted position, the directive introduces efficient assessment timelines for companies’ green claims and evidence. Within 30 days, the validity of these claims will be evaluated, with simpler and more common types of assertions eligible for faster and easier verification processes.

Notably, the regulations ban green claims solely reliant on carbon offsetting schemes. However, companies can acknowledge offsetting and carbon removal schemes in their advertisements under specific conditions, such as reducing emissions substantially and utilising such schemes only for residual emissions, employing certified and high-integrity carbon credits.

The directive introduces penalties for non-compliance, underscoring the EU’s commitment to enforcement. Companies found in violation risk exclusion from public procurements and fines, set at a minimum of 4% of annual revenue.

To facilitate compliance, small and medium businesses are granted an additional year to adhere to the new rules, while microenterprises benefit from exemptions.

The European Union’s efforts to combat greenwashing are part of a broader package of consumer-oriented environmental and circular economy-focused proposals by the EU Commission. On the 17th January 2024, the European Parliament adopted the Directive on Empowering Consumers for the Green Transition (ECGT Directive), this package encompasses initiatives such as the eco-design regulation and updates to the EU’s unfair commercial practices directive (UCPD) and consumer rights directive (CRD), integrating green transition and circular economy-related aspects. It emphasises promoting repair, affirming consumers’ rights to repair their products.

This comprehensive regulatory framework reflects the EU’s dedication to ensuring the integrity of environmental claims, protecting consumer interests, and promoting a genuine transition towards sustainability and circularity within the European market.

If you have any questions packaging compliance, please contact us and one of our specialists will respond to you as soon as possible.