"Carbon Neutral" and "Climate Friendly" - Introduction to the EU's "Green Claims Directive".

Unreliable environmental claims or eco-labels can mislead consumers and give them false impressions about the environmental impact or benefits of a company or brand. This practice is known as "greenwashing". Fraudulent products or misleading advertising may breach the Fair Trading Act or the Consumer Protection Act. However, due to the lack of transparency and asymmetry of information, it can be difficult for regulatory authorities and rights holders to prove corporate greenwashing.

In March 2023, the European Commission approved a proposal for a directive on environmental claims, which aims to tackle the problem of misleading environmental claims by setting strict standards for environmental claims and introducing fines for greenwashing practices. This law is expected to be approved by the European Parliament by 2024.

The aim of this directive is to create a global standard for environmental claims, particularly with a focus on companies doing business in the EU market. In addition to companies from the EU, foreign companies (outside the EU) aimed at consumers in the EU must therefore also comply with this directive. However, there are exceptions: Small businesses with fewer than 10 employees and an annual income of less than 2 million euros are exempt from the obligation to comply with the rules.

This directive sets strict certification standards for ecological claims. If companies want to make ecological claims for themselves or their products, they must prepare rigorous and scientifically recognized evidence that is verified by independent and officially recognized certification bodies, which should then issue a certificate of conformity. (Chun-Kai Huang, more at lexology.com)