On March 22, 2023, the European Commission ("Commission") presented its proposal for a Directive on substantiation and communication of explicit environmental claims ("Proposed Green Claims Directive"). The Proposed Green Claims Directive is intended to work in tandem with the Commission's 2022 Proposal for a Directive empowering consumers for the green transition through better protection against unfair practices and better information ("Proposed Greenwashing Directive"). Both Proposed Directives are intended to contribute to the EU's green transition towards a circular, climate-neutral and clean economy by enabling consumers to make informed purchasing decisions based on reliable information about the sustainability of products and traders. In particular, the Proposed Green Claims Directive would create a common methodology for substantiating green claims about the environmental footprint of products, services and companies and require companies making environmental claims to secure a certification of compliance from an independent national "verifier."
The Commission's publication of the Proposed Green Claims Directive follows the leak of a previous draft of the proposal in January 2023, which we reported on here. Much has changed from the original proposal, but the impact on business remains clear: if passed, the environmental claims that companies make would be subject to strict substantiation requirements, and prior certification by third-party verifiers. Crucially, the proposal would require Member States to fine companies up to 4% of their profits — and bar them from public procurement contracts — if they make unsupported environmental claims.
The Commission has now opened a public consultation on the Proposed Green Claims Directive, and the European Parliament and Council must now review it over the next two years. Interested businesses may want to consider submitting comments to the Commission and proposing amendments to the European Parliament and Council.
Currently, EU law does not explicitly regulate environmental claims. Instead, environmental claims are subject to the general rules of Directive 2005/29 on Unfair Business-to-Consumer Practices and Directive 2006/114 on Comparative Advertising, and national authorities may apply the EU's guidance on applying general consumer protection rules to green claims (see our previous blog post discussing the guidance here). However, in practice, EU Member States apply the general principles in a variety of ways. The Proposed Green Claims Directive, together with the Proposed Greenwashing Directive, is expected to create a harmonized set of rules on the substantiation of voluntary green claims applicable to all companies operating in the EU/EEA.
The Proposed Green Claims Directive would introduce a number of rules for companies making environmental claims. The rules would apply to almost all companies doing business in the EU (excluding micro‑enterprises). However, the rules would not apply to environmental claims that are already subject to more specific rules (e.g., organic claims!i+++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++这可能会导致不同的国家当局如何对公司强制实施差异-因为有些人可能比其他人更容容打包或广告提供的“综合印象”。 Companies interested in submitting comments may do so until May 25, 2023, through the Commission's public consultation website. The European Parliament and Council must also now consider the Proposed Green Claims Directive for adoption through the so-called "ordinary legislative procedure", which typically takes at least 18 months but may be altered due to the European Parliament elections in the second quarter of 2024. As with all Directives, each EU Member State will be required to implement the provisions of the Green Claims Directive in national law, and will be free to adopt more stringent rules. As indicated above, industry should keep a close eye on the development of this proposal as the requirements it would impose will likely have a significant impact on the current practices. Covington can help companies with navigating the Commission's public consultation process and the legislative process.Nextsteps