Beware of advertising with "climate-neutral" and "CO2 reduced"

The facts of the case to be decided by the Kiel Regional Court concerned the claim "CLIMATE-NEUTRAL" ("KLIMA-NEUTRAL"), which was affixed to packaging for garbage bags with a spatial reference to the defendant's corporate logo and the fact that the product would support Gold Standard certified climate protection projects to achieve UN climate goals. Defendant sold both non-climate neutral and climate neutral garbage bags. For more detailed information on its climate protection projects, the defendant referred consumers to its business website.

In this specific case, the Kiel Regional Court considered the information on the packaging to be misleading. The consumer could not see that the addition "CLIMATE-NEUTRAL" was only intended as a kind of sub-brand and therefore only applied to climate-neutral garbage bags. The fact that the indication does not refer to the whole of the defendant's undertaking – contrary to what is suggested by its close proximity to the defendant's corporate logo – can be ascertained by the consumer only if he compares several products. However, such a comparison is regularly omitted in the case of a low-value product – such as bin liners – so that the consumer is left with the incorrect impression that the entire company is climate-neutral. Moreover, the court followed the defendant's view that climate-neutral is not to be equated with emission-free. However, since climate neutrality can be achieved in different ways, more detailed information is essential at the time when the consumer makes his purchase decision. Only in that way could he decide whether he considered certain measures taken by the advertiser to protect the environment worthy of support. According to the Kiel Regional Court, the mere reference of support for Gold Standard certified climate protection projects did not meet these requirements. Rather, the reference to a specific website or the illustration of a QR code by which the consumer could obtain the required concrete information was required. However, the website cited on the defendant's packaging only contained general information and advertising statements relating to its entire company. Only on sub-pages could consumers find more detailed information, which in the opinion of the Kiel Regional Court no longer corresponded to a simple information possibility. In addition, the information there again included inaccurate general praise of the defendant as a climate-neutral company.    

The Higher Regional Court of Hamm also issued a similar ruling in the case of the advertising of lights as "environmentally friendly" ("umweltfreundlich") in connection with the advertising statement: "CO₂ reduced. Environmentally friendly products and sustainable packaging. Our contribution to sustainability." ("CO₂ reduziert. Umweltfreundliche Produkte und nachhaltige Verpackungen. Unser Beitrag zum Thema Nachhaltigkeit."). According to the court, advertising with environmental protection terms and symbols must generally be judged according to strict standards. Terms such as "environmentally friendly", "sustainable” or environmentally compatible" are still vague in their meaning. In addition, products advertised in that way are often more environmentally friendly than other goods only in certain respects. There is therefore an increased need to inform the relevant public about the meaning and content of the terms and signs used in advertising. If the required information is missing from the advertisement or is not clearly visible, there is a high risk that consumers will be misled about the quality of the goods offered and that their decision to buy will be unfairly influenced. According to the Higher Regional Court of Hamm, these high requirements were not met in this specific case. Due to the general nature of the information, the challenged advertising statements left completely open the concrete aspects of the environmental friendliness and CO₂ reduction of the production process, packaging and  distribution. From the information, it was not clear what standard actually existed and why the packaging was supposed to be sustainable. Hence, the advertising was ruled unfair and misleading under German unfair competition law.

Both rulings impressively show that particular care must be taken when using "green claims" in advertising. In particular, this applies if the advertiser intends to include environmentally related statements on product packaging since – due to recent case law of the German Federal Court of Justice on the scope of the injunctive relief – in the worst-case scenario the misleadingly labeled products must be recalled from the distribution channels in the event of a conviction. Companies wishing to advertise their products with environmentally related terms should pay particular attention to the following:

• The advertising claims must be accurate in terms of content. If environmentally friendly properties of the product are mentioned in an advertisement (e.g. recyclability of the material), these product properties must be demonstrably given.
• Any terms used should be sufficiently specific and transparent. An advertising claim should not leave open the specific aspect of the product or the company that is claimed to be environmentally friendly.
• Information essential to the consumer's purchase decision must already be included in the advertising or on the product packaging. What this is depends on the circumstances of the individual case, which includes, above all, the type and value of the advertised product and the reference point of the environmental claim. If the advertiser bases the implementation and qualification of his product or his company on relevant standards (e.g. the British Standard Institution's PAS 2060 standard on CO₂ neutrality), the advertisement or product packaging should also include an identification of the standard. A specific website can only be generally cited for further information and the information provided there must be concrete, transparent and truthful.