A lot has happened at EU level in the area of advertising claims about the environmental benefits of products (“greenwashing”). We had already published the article „Greenwashing – legal requirements for sustainability-related advertising“ on this topic in 2023. Against the backdrop of climate change, information on how a product was manufactured and what resources were used to make it is now an integral part of product advertising. The focus is on claims such as “sustainable”, “climate-neutral” or “eco”. However, strict legal requirements and, in particular, warnings from competitors lurk here.
New “ECGT Directive” approved
In January 2024, the European Parliament adopted Directive (EU) 2024/825 on empowering consumers for the green transition through better protection against unfair practices and better information (ECGT for short). This came into force on March 26, 2024. Among other things, the explanatory memorandum states that
“Consumers must be able to make informed purchasing decisions and thus contribute to more sustainable consumer behavior. Traders are therefore obliged to provide clear, relevant and reliable information.”
This requirement is intended to prevent companies from unlawfully creating an environmentally friendly image through clever marketing and thus influencing consumers’ purchasing decisions, for example by misleading them. Only if the environmental claims on the individual products are truthful, precise and verifiable for the consumer will consumers be in a position to make an environmentally conscious purchasing decision.
Compliance with the legal requirements
In order to meet these requirements, the Union legislator stipulates the following requirements:
- The credibility of sustainability labels is to be increased for consumers. To this end, the use of sustainability labels that are neither determined by government bodies nor based on an objective certification system will be prohibited in future.
- Features that are not directly related to the product in question may no longer be advertised as a benefit for the consumer.
- General environmental claims such as “environmentally friendly”, “eco-friendly”, “green”, “ecological”, “environmentally sound”, “climate-friendly”, “environmentally compatible” or “CO2-friendly” are inadmissible if there is no evidence of a recognized outstanding environmental performance.
- Environmental claims about the product or the business activity as a whole may only be made if the claims are fully accurate. For example, a product may no longer be marketed with the label “made with recycled material” if it is not made entirely from recycled material.
Prospects
The concrete national implementation of the directive remains exciting: German legislators have until March 27, 2026 to do so.
In addition, the ECGT is to be supplemented by a directive which, among other things, sets out specific requirements for the verifiability of environmental claims. The EU Council presented a modified draft of the „Green Claims Directive“ (GCD) on June 17, 2024, which requires the clear and comprehensible explanation of advertised environmental characteristics. It is also certain that the GCD will apply to all companies that make environmental claims to consumers in the EU, regardless of whether these companies are based in the EU or in third countries. It remains to be seen how the EU legislator will shape the content of the directive. What is certain, however, is that infringements may be punished with not inconsiderable sanctions in the future.
As an advertising company, you are directly affected. Prepare for the new regulations now with regard to product design and advertising by comparing advertising claims with the legal requirements.
