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DO's and DON’T's for green claims

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United Kingdom

Driven by an increasing demand from 'conscious consumers' for sustainable goods and services, coupled with regulatory changes, investor pressure and government targets to meet net zero, many businesses are focussing on sustainability as a strategic priority. Part of this strategy may involve adapting their products, including labelling and product claims, to make them appear more attractive to consumers.

Businesses are under an obligation to comply with consumer protection law when making environmental and sustainability claims on their products.  The Competition and Markets Authority (CMA) has recently published draft guidance to help businesses do so.
 
The key takeaways from the guidance are:
 
  1. Claims must be truthful and accurate. Where the claim is only true with caveats these must be made clear. Claims must not deceive consumers even if they are factually correct and broad terms such as 'green' or 'eco-friendly' should be avoided. Businesses should not claim an environmental virtue out of something which is an ordinary legal requirement.
 
  1. Claims should be clear and unambiguous. Claims must not be presented in a way which could confuse consumers or give the impression that the product is better for the environment than it is.
 
  1. Claims should not omit or hide important information. Consumers should be given all information they need to make an informed choice. For example, claims should not focus on positive environmental aspects of a product where other aspects have a negative impact. Any important qualifying information about a claim should be easily identifiable and clear.
 
  1. Comparisons should be fair and meaningful. Any products compared should meet the same needs or be intended for the same purpose. The comparison should be between important, relevant, verifiable and representative features of the relevant products.
 
  1. In making the claim you should consider the full life cycle of the product. Any claims should reflect all aspects of a product or service life cycle or should make clear the particular aspect of the life cycle that the claim relates to.
 
  1. Claims should be substantiated. Most environmental claims are likely to relate to ascertainable matters that can be tested against scientific or other evidence so businesses should hold robust, credible and up to date evidence to support their claims. Claims are less likely to be considered misleading where the supporting evidence is publicly available and it is clear where and how consumers can verify the claims. 
 
The CMA is seeking views on the draft guidance (Draft guidance on environmental claims on goods and services (publishing.service.gov.uk), with the aim of publishing final guidance in September 2021.  Interested parties have until 16 July 2021 to respond.  
 
Consumer protection is a focal point for the CMA and an enforcement priority.  Businesses, particularly those in the food and drinks and retail sectors where product claims around sustainability are becoming increasingly prevalent, should take steps to assess their current practices in order to mitigate the risk of non-compliance with consumer protection law.

Co-authored by Liah Roberts a Trainee Solicitor in the Regulatory group.

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