Companies will now be required to seek approval for any environmental marketing claims before use or face severe penalties after new rules were adopted by The EU Internal Market and Environment committees yesterday (Wednesday 14 February).

Under the directive accredited verifiers will evaluate any environmental marketing or green claims within 30 days, as per the adopted text. Violations of these regulations could result in severe penalties, including exclusion from procurements, revenue confiscation, and fines of a minimum of 4% of the offender’s annual turnover.

The EU Commission is tasked with compiling a list of simpler claims and products eligible for faster or simpler verification procedures. Additionally, deliberations are underway regarding the permissibility of green claims on products containing hazardous substances.

Micro-enterprises are exempt from these obligations, while small and medium-sized enterprises (SMEs) are granted an additional year to comply with the regulations.

In response to the directive Cyrus Engerer, rapporteur for the Environment Committee said: “It is time to put an end to greenwashing. European consumers want to make environmental and sustainable choices and all those offering products or services must guarantee that their green claims are scientifically verified.”

The recently approved green claims directive supplements the EU’s existing ban on greenwashing and it now requires the information companies must provide to substantiate their environmental marketing claims.

Moreover, it establishes a structured framework and deadlines for scrutinising evidence and endorsing claims, accompanied by clear penalties for non-compliance.

Stricter guidelines on carbon offsetting and comparative environmental claims

The directive solidifies the recent EU ban on green claims solely reliant on carbon offsetting schemes. However, it allows companies to reference offsetting schemes provided they have maximally reduced emissions and employ these schemes for residual emissions only.

Carbon credits within these schemes must be certified following the established Carbon Removals Certification Framework.

Special provisions govern comparative claims, particularly in advertisements juxtaposing two distinct goods, even if produced by the same entity. Companies are required to demonstrate uniform methods in comparing relevant product aspects. Furthermore, claims of product enhancements cannot be predicated on data older than five years.

Andrus Ansip, rapporteur for the Internal Market Committee commented: “Studies show that 50% of companies’ environmental claims are misleading. Consumers and entrepreneurs deserve transparency, legal clarity and equal conditions of competition.

“The solution proposed by the committees is balanced, brings more clarity to consumers and at the same time is, in many cases, less burdensome for businesses than the solution originally proposed by the Commission.”

Next steps

The draft report, endorsed with an overwhelming majority with 85 votes to 2 and 14 abstentions will be put to vote at the upcoming plenary session, expected in March. Subsequently, the new Parliament will follow the file after the European elections on 6-9 June.

Earlier this week (13 February), Environmental advocacy organisation Stand.earth filed a complaint against Canadian sports brand Lululemon for its alleged greenwashing and “inconsistent” public claims of being an environmentally positive company.