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On 22 March 2023 the European Commission published a proposalfor a Directive on Green Claims affecting commercial communicationsthat associate products/services with environmental or ecologicalbenefits.

The proposal complements and specifies an earlier proposal for aDirective on empowering consumers for the green transition1, and is thus part of aframework of strategic initiatives and action policies adopted bythe European Union (EU) in support of the circular economy, andaims to decrease the impact of climate change in order to achieveclimate neutrality.

The strategy pursued by the EU cannot disregard the activeparticipation of consumers in the ecological transition, whichrequires their adequate protection against unfair commercialpractices that prevent them from making informed and sustainablechoices. Such practices include greenwashing, in which companiesmake false environmental declarations in the context of theircommunication strategies, aimed at building a deceptively positiveimage of the company as to its environmental impact, with the clearobjective of capturing the attention and interest of consumers.

In 2020, the Commission carried out a study of more than 150environmental claims for a wide range of products and found thatmore than 53% of them were too "vague, misleading orunfounded", and that 40% were not supported by adequatetechnical and scientific evidence. These data show thatcompanies/traders have an increasing interest in providingmisleading environmental information on their products/services, tothe detriment of consumers wishing to make more sustainable andresponsible purchasing choices, and of virtuous companies sufferingfrom unfair competition.

From the need to contrast this increasingly widespreadphenomenon comes the provision of specific rules on the subject,aimed at setting minimum requirements for the verification ofenvironmental claims adopted by traders and thus improving thereliability of the information conveyed to consumers, facilitatingtheir choice of products and/or services that offer betterenvironmental performance.

First, the proposal aims to regulate the voluntary environmentalclaims2 of thecompanies concerning the environmental impact and performance oftheir products/services, providing that they be clear andadequately substantiated. Inter alia, voluntarydeclarations will have to specify whether they relate to thecompany's entire production or only to a particular product,one of its components, or one of its life cycle stages, in order to"make it possible to identify the environmental impactsand environmental aspects for the product or trader that jointlycontribute significantly to the overall environmental performanceof the product or trader". Furthermore, voluntary claimswill have to be validated by widely recognised scientific evidence,and evaluated by independent, accredited, verifying organisations,which will decide whether to issue a certificate of conformityvalid throughout the EU.

Should the proposal become law, it would no longer be possibleto use vague and ambiguous claims such as "climateneutral", "carbon neutral" or"100% CO2 compensated", if they do not meet allthe requirements of the Directive. Indeed, traders will be requiredto avoid claims expressed in broad or absolute terms, insteadhaving to circumscribe to the precise environmental benefitclaimed, which, of course, will have to be properly verified andsupported by technical evidence.

The proposed Directive also regulates so-called environmentallabels and their schemes, such as the EU Ecolabel and its nationalequivalents, awarded to products and/or services that are producedand marketed with a reduced environmental impact. The EU has notedthat more than 200 environmental labels are currently in use andtheir further proliferation could lead to consumer confusion, aswell as to a loss of value of existing labels. To address this, theCommission has advanced the possibility of preventing new publiclabelling schemes from being proposed unless they are developedexclusively within the EU. As a result, any new private scheme willhave to prove that it pursues more ambitious environmentalobjectives than existing ones, while obtaining prior approval inorder to be officially authorised.

Naturally, the proposal also regulates the enforcement of theprovisions contained therein, whose compliance is to be ensured bythe Member States by means of appropriate control systems and bythe provision of penalties, with varying amounts depending on thenature and seriousness of the violations ascertained.

The proposal will soon be assessed by the European Parliamentand the Council for their joint approval and, in the event of apositive outcome, the Member States will have to incorporate theDirective into their respective legal systems to ensure its uniformapplication within the EU territory.

Currently in Italy there are no specific legislations onenvironmental claims, so they are regulated by the generalprovisions of the Consumer Code on unfair commercial practices,those of the Civil Code on unfair competition, as well as theregulations on misleading advertising. The framework is completedby the European Directive 2005/29/EC and the Guidance on theimplementation/application of directive 2005/29/EC on UnfairCommercial Practices issued by the European Commission on25 May 2016, which contains useful guidelines on green claims, forexample that they be formulated "in a clear, specific,accurate and unambiguous manner".

Additionally, a provision specifically dedicated to commercialcommunications of an environmental nature is contained in Article12 of the Italian Code of Self-Discipline for CommercialCommunications, according to which "marketingcommunication that claims or evokes benefits of an environmental orecological nature must be based on truthful, relevant andscientifically verifiable data".

The above-mentioned provision was referred to by the Court ofGorizia in the first (and only) Italian court ruling ongreenwashing3. In this landmark decision,the judge acknowledged that generic expressions such as"environmentally friendly", "naturalchoice", "100% recyclable" constituteto all intents and purposes misleading advertising when they arenot clear, verifiable or supported by solid scientificevidence.

In the context of fragmented national regulations, the GreenClaims Directive could therefore be an effective tool to limitgreenwashing and related unfair commercial practices that aregrowing exponentially in parallel with the environmental awarenessof the consumers.

Footnotes

1. European Commissionproposal of 30 March 2022 amending Directives 2005/29/EC on unfaircommercial practices and 2011/83/EU on consumer rights.

2. On the other hand,the proposed Directive does not cover voluntary declarations thatare already regulated by other EU rules, such as the EU Ecolabel,as the relevant existing legislation already guarantees theirreliability.

3. Court of Gorizia,order of 25 November 2021 (Alcantara S.p.A vs. Miko S.r.l.). Theorder was then appealed by Miko S.r.l. and overturned by the Courtof Gorizia in March 2022, on the basis that Alcantara had beenunable to provide any evidence that Miko's environmental claimshad resulted in a risk of loss of customers forAlcantara.

The content of this article is intended to provide a generalguide to the subject matter. Specialist advice should be soughtabout your specific circumstances.

See the article here:
A Step Forward Against Greenwashing: The European Commission ... - Mondaq News Alerts