Context and Purpose
Since sustainability became a "hot" topic, an increasing number of companies tend to claim that their products are sustainable, green, or eco-friendly to influence consumer choice. Often, these claims are vague, misleading, not evidence-based, or based on eco-labels that are not trustworthy.
Such practices are commonly referred to as greenwashing.
On 17/1/24, the EU Parliament voted to implement the Directive of the European Parliament and of the Council amending Directives 2005/29/EC and 2011/83/EU, empowering consumers for the green transition through better protection against unfair practices and better information (also called the EmpCo Directive). It aims to protect consumers against such deceptive practices.
The overall purpose of the directive is to enable consumers to make informed "green" choices when purchasing products or services and protect them from false statements.
The new rules first of all intend to adapt the Unfair Commercial Practices Directive 2005/29/EC.
In this directive, a new notion of “environmental claim” is introduced. An environmental claim will be understood as “any message or representation which is not mandatory under Union or national law, in any form, including text, pictorial, graphic or symbolic representation, such as labels, brand names, company names or product names, in the context of a commercial communication, and which states or implies that a product, product category, brand or trader has a positive or zero impact on the environment or is less damaging to the environment than other products, product categories, brands or traders, or has improved its impact over time”.
Such a claim is called a generic environmental claim if it is made in written or oral form, including through audiovisual media, not included on a sustainability label, and where the specification of the claim is not provided in clear and prominent terms on the same medium.
Article 6 of the Unfair Commercial Practices directive will be adapted to ensure that consumers are not misled about a product’s environmental or social characteristics or circularity aspects, such as durability, reparability, or recyclability, through the overall presentation of a product.
The belief is that in that way consumers will be empowered to make better-informed decisions and thus stimulate the demand for, and the supply of, more sustainable goods.
The list of main characteristics of the product in respect of which misleading practices are forbidden or is extended to environmental or social characteristics, circularity aspects, such as durability, reparability, or recyclability.
In addition, a commercial practice that, in its factual context, causes or is likely to cause the average consumer to take a transactional decision that he would not have taken otherwise, will also be considered misleading if it involves:
- Making an environmental claim related to future environmental performance without clear, objective, publicly available and verifiable commitments set out in a detailed and realistic implementation plan that includes measurable and time-bound targets and other relevant elements necessary to support its implementation, such as allocation of resources, and that is regularly verified by an independent third party expert, whose findings are made available to consumer; or
- Advertising benefits to consumers that are irrelevant and do not result from any feature of the product or business.
It is also proposed to supplement Article 7 of the Unfair Commercial Practices Directive regarding misleading omissions with a paragraph indicating that where a trader provides a service that compares products and provides the consumer with information on environmental or social characteristics or on circularity aspects, such as durability, reparability, or recyclability, of the products or suppliers of those products, information about the method of comparison, the products which are the object of comparison, and the suppliers of those products, as well as the measures in place to keep that information up to date, will be considered material information. Hence the omission of this information will, under further conditions, be considered a misleading commercial practice.
Finally, the list of commercial practices that are in all circumstances considered unfair (Annex I of the Unfair Commercial Practices Directive) is supplemented with the following forbidden practices:
- Displaying a sustainability label that is not based on a certification scheme or not established by public authorities;
- Making a generic environmental claim for which the trader is not able to demonstrate recognised excellent environmental performance relevant to the claim;
- Making an environmental claim about the entire product or the trader’s entire business when it concerns only a certain aspect of the product or a specific activity of the trader’s business;
- Claiming, based on the offsetting of greenhouse gas emissions, that a product has a neutral, reduced or positive impact on the environment in terms of greenhouse gas emissions;
- Presenting requirements imposed by law on all products within the relevant product category on the Union market as a distinctive feature of the trader’s offer;
- Withholding information from the consumer about the fact that a software update will negatively impact the functioning of goods with digital elements or the use of digital content or digital services;
- Presenting a software update as necessary when it only enhances functionality features;
- Any commercial communication in relation to a good containing a feature introduced to limit its durability despite information on the feature and its effects on the durability of the good being available to the trader;
- Falsely claiming that under normal conditions of use a good has a certain durability in terms of usage time or intensity;
- Presenting a good as allowing repair when it does not;
- Inducing the consumer to replace or replenish the consumables of a good earlier than necessary for technical reasons;
- Withholding information concerning the impairment of the functionality of a good when consumables, spare parts or accessories not supplied by the original producer are used, or falsely claiming that such impairment will happen.
The EmpCo directive also adapts the Consumer Rights Directive 2011/83/EU to include new information obligations, for both non-distance and off-premises contracts and distance and off-premises contracts, regarding the legal guarantee of conformity of goods and commercial guarantees. A mechanism of harmonized notice for the legal guarantee and a harmonized label for the commercial guarantee will be introduced. The design and content of the harmonized label will be determined by a delegated act of the European Commission.
Consumers will also need to be informed about the availability and estimated cost of, and procedure for ordering, spare parts that are necessary to keep the goods in conformity and about the availability of repair and maintenance instructions and about repair restrictions.
For distance and off-premises contracts, information will furthermore need to be provided on environmentally friendly delivery options where available.
Notably, the EmpCo directive doesn't enforce information provision regarding eco-friendliness, but if companies choose to provide such information, compliance with EmpCo directive requirements is essential.
Next Steps and Practical Recommendations
The directive is yet to be officially published in the EU Official Journal, and then member states have 24 months to transpose it into national law.
Once the directive is transposed into national law and such national law is in force, companies will need to reassess and be cautious in respect of any green claims made and information provided in this context.
Although the more strict standards for environmental claims are not yet formally adopted and applicable, eco-friendliness will increasingly become a competitive characteristic of products and services. It may thus be recommendable to prepare upfront compliance with the directive.
At this stage we have the following recommendations:
- Familiarize yourself with the EmpCo Directive and associated amendments to comprehend the regulatory changes thoroughly;
- Conduct an internal review of current practices, ensuring alignment with the forthcoming regulations. Identify areas that may require adjustments;
- Ensure that any environmental claims made by your company are well-documented, evidence-based, and aligned with the proposed regulations. Maintain a clear record of eco-labels and certifications;
- Evaluate current marketing and communication strategies, especially those related to environmental claims. Ensure that language is precise, avoiding vague terms and adhering to the proposed directive's guidelines;
- Provide training sessions to relevant staff members to enhance awareness of the new regulations and guidelines. Educate employees about the importance of accurate environmental claims;
- Seek recognized eco-certifications that can validate your environmental performance;
- Anticipate upcoming information obligations related to legal guarantees, commercial guarantees, and other aspects. Prepare to provide necessary information to consumers as outlined in the directive.
How we can support you
For queries on the directive or assistance in implementation, our team is available to provide information on an individual basis or in a workshop format.
We can support aligning communications with upcoming requirements and assist in the certification process.