The main objective of the Empowering Consumers Directive and the Directive Proposal on Green Claims [1] is to provide transparency and truthfulness between consumers and retailers, while promoting responsible and sustainable consumption, and thus preventing greenwashing behaviours, which are entrenched in the European market.

In response to growing concerns about greenwashing, regulatory bodies in various countries are beginning to crack down on misleading environmental claims. In this article, you'll know more about the different implications that the Spanish market is starting to confront. 

The enforcement of the different Directives is carried out by national authorities within each EU member state, who also have the power to investigate companies, demand evidence for their claims, issue fines, and require corrective actions if they find violations of the directive.

Through Law 3/1991, of January 10, 1991, on Unfair Competition (hereinafter, “LCD”), action has been taken in Spain against misleading advertising (article 5.1 LCD), when false or even truthful information is transmitted, but which by its content or presentation induces or may induce an error, thus being susceptible of distorting its economic behaviour. It is also possible to resort to the protection of the national or regional consumer authorities through the General Law for the Consumers and Users Protection, or to advertising self-regulation (AUTOCONTROL). 

However, it should be noted that neither LCD nor other regulations contain specific rules about environmental claims or guidance on how they should be made or disseminated.

Current Practice

To date, the Spanish courts have generally considered misleading environmental claims used in advertising to be those where the accuracy of the claim has not been verified or/and they are acts of denigration:

• the Milk Case in Madrid, dated July 18, 2023, which considered the slogan “It's like milk, but made for humans” and several communications related to the alleged harm of milk for people or the polluting effects of the dairy industry to be misleading; 
• the Burger Case in Barcelona, dated May 24, 2022, which considered the advertising message “a meat hamburger pollutes more than your car” made by a manufacturer of vegetable hamburgers to be misleading, and, furthermore, that it constituted denigratory advertising insofar as it had the capacity to devalue the quality of the plaintiff's products in the market; and 
• the Water Case in Barcelona, dated October 6, 2020, which considered that some allegations made by the defendant in its advertising were misleading, by suggesting that filtered water is better for your health than bottled water, as well as denigratory acts when talking about the effects of plastic in relation to climate change, as accurate and truthful [2]. 

Misleading Claims

With the Empowering Consumers Directive we now have some guidance on misleading practices. Article 6 of the Directive  now states that the main characteristics of a product such as its “environmental or social characteristics”, “durability”, “repairability” and “recyclability” could mislead consumers as they are not always able to assess the reliability of that information. Moreover, two additional practices that could be considered misleading are: 

1. Making an environmental claim related to future environmental performance without clear, objective, publicly available and verifiable commitments; and 
2. Advertising benefits to consumers that are irrelevant and do not result from any feature of the product or business. 

Also, in the new Article 7 of the Directive you will find what constitutes material information.  In other words, the comparison of products on environmental or social characteristics, or on aspects such as durability, reparability or recyclability, information on the method of comparison, the products compared, the suppliers and the measures to update the information.

Sustainability Labelling

We should also highlight the prohibition on displaying on products a sustainability label that is not based on a certification scheme or that has not been established by the public authorities. The certification  of any claim must be carried out by third party experts and must certify that a product, process, or company meets certain requirements (Article 2), thereby allowing the use of the corresponding sustainability labelling and that its conditions are publicly available and comply with certain criteria.

Prohibition of Generic Green Claims

The prohibition of generic green claims is equally relevant. Recital 9 of the Empowering Consumers Directive shows some examples of such claims, such as “eco- friendly”, “green”, “nature’s friend”, “ecological”, “environmentally correct”, “climate friendly”, “gentle on the environment”, “carbon friendly”, “energy efficient”, “biodegradable”. Such generic environmental claims should be prohibited when recognised excellent environmental performance cannot be demonstrated.  

Other misleading claims arise from the offsetting of greenhouse gas emissions. Recital 12 of the Empowering Consumers Directive explains that such claims like “climate neutral”, “CO2 neutral certified”, “carbon positive”, “climate net zero”, “climate compensated”, “reduced climate impact” and “limited CO2 footprint” can be misleading. These claims should only be allowed when based on the actual life cycle impact of the product and not based on offsetting greenhouse gas emissions outside the product’s value chain.

Directive Proposal on Green Claims

The Directive Proposal on Green Claims, which is complementary to the Empowering Consumers Directive, obliges companies to justify the environmental claims they make, requiring retailers to carry out an assessment to justify their explicit and comparative green claims, and the communication of them. 

Another element to be highlighted in this Directive Proposal on Green Claims consists of the establishment of a sanctioning regime for green claims (Article 17), which may reach a maximum amount of at least 4% of the retailer's annual turnover in the Member State concerned, forfeiture of the income obtained by the retailer and temporary exclusion, for a maximum period of twelve (12) months, from public procurement procedures and from access to public financing.

Therefore, it is advisable for companies to analyse these obligations thoroughly to develop an appropriate strategy regarding the publicity of its claims to avoid the risks of being prosecuted for greenwashing practices.

[1] On February 28, 2024, the Directive 2024/825 of the European Parliament and of the Council amending Directives 2005/29/EC and 2011/83/EU as regards empowering consumers for the green transition through better protection against unfair practices and better information (the “Empowering Consumers Directive”), whose Proposal for a Directive was presented on March 30, 2022, was finally approved. Together with the aforementioned Directive, on January 17, 2024, the European Parliament gave the green light to the Proposal for the Directive of the European Parliament and of the Council of March 22, 2023, on substantiation and communication of explicit environmental claims (the "The Directive Proposal on Green Claims”).

[2] In other cases, such as the decision of the Commercial Court No. 10 of Barcelona, dated February 20, 2023, it was considered that including in advertising the term “biodegradable formula” neither for the advertising relevance given to this characteristic in the packaging of the product, nor for the content of what it expressed (it was considered as a proven fact that more than 60% of the substances in the product were biodegradable) could be considered misleading advertising.