In brief
As part of the EU Green Deal, the Consumer Empowerment Directive aims to prevent and penalize misleading environmental claims made by companies in commercial communications, such as on packaging and in marketing campaigns. National law implementing the Directive will come into force in the Netherlands and throughout Europe from 27 September 2026.
The new rules provide for strict obligations for companies to specify and substantiate their environmental claims. Claims that do not meet these requirements can mislead consumers and will therefore qualify as an unfair commercial practice. That can happen relatively fast: stating a product is “green” or “eco-friendly” without adequate substantiation can be labelled as misleading. Companies will have to align their environmental claims with this new legal framework to limit potential liability for claims from consumers, competitors or regulators arising out of non-compliance.
This alert provides a short rundown of the new rules and their practical implications for companies seeking to manage enforcement, litigation and reputational risks.
Key takeaways
The EU Consumer Empowerment Directive provides for stricter rules on companies’ environmental claims and will soon come into effect in Member States. Making claims that breach these rules will qualify as a misleading commercial practice and can lead to potential liability for the company involved.
- These rules form part of the EU’s focus on sustainability and the broader framework on unfair commercial practices intended to protect consumers in the European Union.
- Environmental claims (both visual and in writing) are subject to strict obligations on form, content and presentation in order to protect consumers against misleading greenwashing claims.
- Companies acting in breach of the rules can be faced with orders and fines from regulators and (mass) claims from consumers (and potentially competitors) in civil court litigation.
- Companies will have to review their environmental claims and advertising campaigns in order to align with the new rules and limit liability and reputational risks.
Detailed look – new rules & enforcement
The EU Directive Consumer Empowerment Directive contains new rules on environmental claims that must be transposed into national law, and be applied by the Member States as of 27 September 2026. The Directive seeks to protect consumers from misleading commercial practices and provides new obligations on the form and content of environmental claims.1
The Directive introduces the following new definitions for environmental claims:
- Environmental claims consist of any non-mandatory commercial texts or visual representations which state or imply that a product (category), brand or company either (i) has a positive or zero impact on the environment; (ii) is less damaging to the environment in comparison with other product (categories), brands or companies; or (iii) has improved its environmental impact over time.
- Generic environmental claims are those claims that are not included on a sustainability label and are not directly specified in clear and prominent terms – for example “eco-friendly”, “green” or “biobased”.
Environmental claims can be both text and images – even a picture of a green leaf or a globe could potentially qualify as an environmental claim. As a general rule, a company’s environmental claims must be factually correct, sufficiently substantiated and not misleading to the average consumer. Furthermore, companies’ environmental claims will have to comply with the following obligations:
- Environmental claims related to future environmental performance must include a detailed and realistic implementation plan that includes clear, objective and verifiable commitments and measurable and time-bound targets. This plan must be regularly and publicly verified by an independent third-party expert.
- Generic environmental claims can only be made if the company can show excellent environmental performance, recognized by EU law.
- Sustainability labels must be based on a certification scheme or established by public authorities.
- Environmental claims only related to a certain aspect of the product or specific activity must be clearly identifiable as such.
- Offsetting greenhouse gas emissions cannot be used to claim that a product has a neutral, reduced or positive impact on the environment in terms of emissions.
Non-compliance with these rules will constitute an unfair commercial practice and could expose companies to regulatory enforcement and civil actions by consumers (and potentially competitors).
In the Netherlands, the Authority Consumer and Market (ACM) already employs consumer law to combat misleading sustainability claims and has announced its intention to enforce the new rules.
The ACM can impose orders and fines of up to 10% of a company’s revenue. An order from the ACM to, for example, change certain misleading statements on a product’s packaging, could potentially necessitate relabeling products or a stock recall. With regard to claims made on (packaging of) stock already in use when the new rules take effect, European regulators have published a joint statement which contains a tailored approach for enforcement.2
Consumers may also bring (mass) civil court claims against companies seeking remedies such as damages or contract termination. Similar civil court action has already been brought in the Netherlands under general consumer law. The burden of proof for the validity of the environmental claims will generally lie with the company concerned. Also, there is a legal presumption that any misleading commercial practice is attributable to the company, unless it proves otherwise. Competitors could potentially bring civil claims as well.
What companies can do to prepare
Companies often employ (generic) environmental claims in their marketing communications. Such claims could now come under closer scrutiny and generate liability or reputational risks relatively quickly – stating a product is “green” without sufficient substantiation could already be labelled as misleading under the new rules. To limit potential risks, companies will have to ensure their environmental claims are in line with the new rules from 27 September 2026 onwards. Such actions could include:
- Reviewing current environmental claims and labels across ad campaigns, websites and packaging for correct specification and substantiation.
- Assessing which environmental claims are mandatory (not in-scope of the new rules) and non-mandatory (in-scope of the new rules).
- Ensuring future compliance through internal procedures.
- Investing in (third-party) verification of environmental claims.
- Discontinuing the use of certain environmental claims to avoid liability risks.
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1 The Directive also provides for new rules that oblige companies to provide information on, inter alia, (guarantees related to) durability and reparability of goods, and for digital services on the availability of software updates. These topics are not discussed in this alert.
2 https://www.acm.nl/system/files/documents/final-cpc-common-understanding-on-old-stock-situations.pdf