The European Parliament has proposed a stricter verification system for environmental marketing claims to enhance consumer protection.
Under this initiative, companies must undergo verification before using claims like “biodegradable” or “less polluting” in their advertising, according to ESG News.
It is hoped that this tighter legislation will prevent misleading ads and ensure transparency in environmental claims.
The directive requires companies to provide evidence supporting their environmental marketing claims before advertising products as “biodegradable”, “less polluting”, “water-saving”, or with “bio-based content”. EU countries will assign verifiers to pre-approve such claims, protecting consumers from ambiguous advertising.
Claims and evidence will be assessed within 30 days, with simpler claims benefiting from quicker verification.
Micro enterprises are exempt from the rules, while SMEs have an additional year to comply. Penalties for rule-breaking companies include temporary exclusion from public procurement tenders, revenue confiscation, and fines of at least 4% of annual turnover.
Green claims solely based on carbon offsetting schemes remain prohibited. However, companies can mention offsetting and carbon removal schemes in their ads if they’ve already minimised emissions and use these schemes for residual emissions only.
Parliament also decided to allow green claims about products containing hazardous substances for now, pending assessment by the Commission for potential future bans.
Following the vote, both rapporteurs are scheduled to host a press conference on Tuesday at 14:30 CET.
Speaking on the plans, Internal Market Committee rapporteur Andrus Ansip (Renew, EE) said, “Studies show that over 50% of environmental claims are vague, misleading or unfounded. We cannot speak about happy consumers if every other green claim is false. We cannot talk about a level playing field for our entrepreneurs while some traders are cheating. I believe the Green Claims Directive adopted today is balanced – it will bring clarity to our consumers and is less burdensome for traders than the claim-by-claim verification.”
Environment Committee rapporteur Cyrus Engerer (S&D, MT) added, “It is time to put an end to greenwashing. Our position ends the proliferation of misleading green claims that have deceived consumers for far too long. We will ensure businesses have the right tools to embrace genuine sustainability practices. European consumers want to make sustainable choices; all those offering products or services must guarantee their green claims are scientifically verified.”
Keep up with all the latest FinTech news here.
Copyright © 2024 FinTech Global
