The EU Green Claims Directive - where are we now, and what's next?
The EU Green Claims Directive Proposal (Proposal) was originally adopted by the EU Commission back in March 2023 as part of the European Green Deal. This development was being closely watched by a wide range of businesses due to the increased responsibilities and constraints it proposed to add to green claims and labels. However, a dramatic turn of events towards the end of June this year ended up with the Commission announcing its intention to withdraw the Proposal just before it should have been discussed at the final trilogue (the inter-institutional discussion process between the European Parliament, the Council and the Commission), which was ultimately cancelled.
This Law Now will explore the current situation surrounding this highly anticipated piece of legislation and explain where things are from an EU procedural and legal perspective, including what happened, current status, and identify some potential outcomes that may transpire.
The Green Claims Proposal
The Proposal aims at establishing common criteria in a bid to strengthen the EU’s fight against greenwashing and the non-compliance of environment claims used by businesses to market their products, complementing other greenwashing laws. This Proposal is designed to focus on the regulation of environmental labels and ‘explicit environmental claims’, in text or as a label, and sets out minimum requirements for the justification, communication, and verification of such claims, implementing a pre-verification system for both claims and labels.
Some of these requirements have been met with criticism through the legislative process – particularly the pre-verification system which is regarded by some as imposing significant burdens, costs and delays, which could be particularly problematic for small and medium-sized enterprises (SMEs).
It is also important to clarify that this Proposal is a separate piece of legislation from the Empowering Consumers for the Green Transition Directive (ECD), which has already been adopted by the EU and will apply from September 2026 no matter what ultimately happens with this Proposal. The ECD itself already introduces significant changes to environmental advertising including a prohibition on vague environmental claims which cannot be demonstrated, a prohibition on using or creating unreliable sustainability labels, and a prohibition on false claims about the sustainability of an asset – see our prior article: Greenwashing: Stricter EU rules on environmental marketing ban misleading and offsetting claims and introduce new information requirements for products, to protect consumers
Where are we now?
Procedurally, the Proposal has not officially been withdrawn by the Commission – only its intention to do so was announced. This was initially due to an increasing lack of support from the Commission, and the European Parliament’s European People’s Party (EPP) political group. This was linked to a dispute over the Proposal applying to SMEs, which was not supported by the EPP, who wrote to the Commission requesting the withdrawal. However, other political parties voiced their continued support for the Proposal and the trilogue process, with some threatening backlash on other files if the Proposal did not progress. The Commission’s official statement explained that the ongoing talks on the Proposal go against the Commission’s simplification agenda – which has seen the Commission put forward various ‘Omnibus’ proposal amendments aiming to simplify and streamline EU sustainability regulatory frameworks. The final move which ultimately led to the Commission’s announcement to withdraw was Italy’s changed Council position, withdrawing its support for the Proposal (due to the inclusion of micro-enterprises), which led to a blocking minority against the Council position.
Legally, there is also a question over the ability of the Commission to unilaterally withdraw the Proposal. Case law from the Luxembourg Courts would indicate that the Commission would need justification if the other two EU institutions had already adopted a first-reading position, or otherwise requires support from both to withdraw. In any event, this is a highly unusual occurrence which only happens when the co-legislators European Parliament and the Council are unable to agree, or the Commission disagrees with a compromised text. Several Council Member State representatives were disappointed with the Commission’s unilateral action. Ultimately, any decision to withdraw by the Commission would need approval from the College of Commissioners to take place. However, the Commission President has also since confirmed that the Commission never intended to withdraw the Proposal.
What’s next?
As set out above, at the time of writing the Proposal has not been withdrawn by the Commission. However, the final trilogue was cancelled, and so far there has not been anything re-scheduled. It may take some time with the packed July programme of the EU Institutions before the long European summer break for things to be re-tabled, so the discussion being picked up again in September or later may not be a surprise. The Commission has indicated that it is for the Council to speak on the way forward from here, as a result of Italy’s withdrawal of support and the resulting blocking minority. The Danish took their place as President of the Council on 1 July, and will take over the lead on the file, dealing with relevant concerned Council members – which will be the ultimate gateway to progress or not. We will update this alert with any developments as and when they take place.
Even in the case the Proposal did end up being withdrawn, it is also important to bear in mind that this would not necessarily lead to less EU green claims scrutiny or enforcement – which is strong in many EU Member States and continues to be an enforcement focus. Withdrawing the Proposal will not bring an end to the increasing greenwashing enforcement actions at Member State level under the Unfair Commercial Practices Directive implemented at national level. In addition, businesses should continue to prepare for compliance with the requirements of the ECD which will also still apply from September 2026.
Our multinational team and our ‘on the ground’ colleagues in Brussels are monitoring this file closely, along with the Greenwashing Directive and national measures. Please get in touch with any of the key contacts or your local CMS contacts if you would like further information and updates.
