Tackling greenwashing: the new EU framework and its impact on Belgian legislation

1. INTRODUCTION

The European Union has recently adopted the so-called Directive on Empowering Consumers for the Green Transition (Directive (EU) 2024/825) (hereafter the “Directive”), which will, among other things, regulate the use of environmental claims to tackle greenwashing.

In this article we outline the current greenwashing regime in Belgium and summarise the main legal changes put forward in the Directive on Empowering Consumers for the Green Transition in relation to green claims and how these will impact the Belgian framework.

2. CURRENT BELGIAN LEGAL FRAMEWORK
   • Code of Economic Law

Currently, Belgium does not have specific legislation against greenwashing.

In an advertisement context, environmental claims must simply comply with the general rules on unfair commercial practices, including those on misleading and comparative advertising. These rules are embedded in Articles VI.92-VI.103 of the Belgian Code of Economic Law (“BCEL”), and are derived from the Directive 2005/29/EC concerning unfair B2C commercial practices and Directive 2006/114/EC concerning misleading and comparative advertising.

As such, environmental claims will be prohibited when they can be qualified as ‘misleading commercial practices’. A ‘misleading commercial practice’ is a practice which can mislead consumers and cause consumers to take a transactional decision that they would not have taken otherwise, either on the basis of false information, or on the basis of correct information which can still mislead the consumers regarding one or more aspects of the transaction. Such aspects can include the existence of the nature of the product, the main characteristics of the product, etc.

Furthermore, the so-called ‘blacklist’ of unfair B2C commercial practices, as included under article VI.100 BCEL, can be used to address certain specific types of greenwashing claims, such as:

• Claiming to be a signatory to a code of conduct when the trader is not;
• Displaying a trust mark, quality mark or equivalent without having obtained the necessary authorisation;
• Claiming that a code of conduct has an endorsement from a public or other body which it does not have;
• Claiming that a trader (including his commercial practices) or a product has been approved, endorsed or authorised by a public or private body when he/she/it has not or making such a claim without complying with the terms of the approval, endorsement or authorisation; or
• Presenting rights given to consumers in law as a distinctive feature of the trader's offer.

The Economic Inspectorate has already published guidelines regarding environmental claims (NL / FR), in which they set out what needs to be understood under ‘environmental claim’ and ‘greenwashing’, and give certain tips to recognise and avoid greenwashing. For example, vague, imprecise, ambiguous and absolute terms, such as ‘eco-friendly’ and ‘sustainable’, should be avoided without additional substantiation. Also specific claims, such as ‘made from 100% recyclable material’, should be substantiated with the necessary clarifications on whether such claim relates to the packaging, the content, or both.

Where an advertisement or communication would possibly constitute an unfair market practice, consumers, competitors, the Economic Inspectorate of the FPS Economy, the Communicatie Centrum vzw/asbl (as legal organisation behind the JEP (infra)) or any other actors with a legitimate interest may initiate court proceedings based on the relevant provisions of the BCEL. In addition, the Economic Inspection service of the FPS Economy will also monitor the compliance with the above-mentioned articles of the BCEL through administrative investigations.

Until today, there is not much published case law in Belgium regarding green claims based on the above-mentioned legal framework. In a judgment of 28 June 2019, the Brussels Court of Appeal decided that a claim regarding the packaging of a product stating that the bottle was for 50% made out of recycled plastics from the ocean, while in fact this percentage was lower and covered both recycled plastics from the ocean and beaches, did not constitute a misleading advertisement. This would namely not affect the consumer’s economic behaviour in the court’s eyes.

When a court would rule however that a greenwashing claim constitutes misleading advertising or an unfair market practice, it can impose a criminal fine of up to 80,000.00 EUR or 4% of the undertaking’s annual turnover, whichever is higher. In addition, other general sanctions, such as the publication of the judgement on the website of the undertaking may be imposed.

Where the Economic Inspection of the FPS Economy would come to the conclusion that a greenwashing claim constitutes misleading advertising or an unfair market practice after an administrative investigation, they can (i) issue a warning, (ii) pass the case down to the public prosecutor, (iii) impose an administrative fine of up to 80,000.00 EUR or 4% of the undertaking’s annual turnover, whichever is higher, or (iv) offer a settlement.

• Soft law and self-regulation by the JEP

In addition to the legal framework under the BCEL, Belgium has an independent, self-regulatory organisation for the marketing sector, namely the Jury for Ethical Practices in Advertising (Jury voor Ethische Praktijken inzake Reclame / Jury d’Ethique Publicitaire) (“JEP”). The JEP is part of the European Advertising Standards Alliance (“EASA”) and investigates whether advertisements and marketing is compliant with their ethical rules, laws and codes. The JEP can either investigate complaints and act proactively.

The JEP has published an environmental advertising code (NL / FR), that sets out a number of general principles for green claims, e.g. the prohibition of the use of absolute slogans, such as “environmentally friendly”, which would imply that there are no negative consequences at any stage of the product’s life cycle for the environment, unless proven otherwise. The gist of this code is again that no misleading may take place.

In addition, the JEP adopted its code on advertising and marketing communication for household detergents and maintenance products (NL / FR), which also includes specific rules on the environmental and sustainability aspects of advertisements for such products, in terms of accuracy and relevance of the claim, the wording of the claim, any commitments made and the justification of such claims.

Given that the JEP is not a judicial body, its array of sanctions in case where they would find an infringement is rather limited. The JEP can issue a decision whereby the undertaking must change or discontinue the misleading advertisement. If an undertaking fails to comply with such a decision, the JEP can pass the case down to the Communicatie Centrum vzw/asbl (the legal organisation behind the JEP), that can start legal actions against the undertaking.

3. EMPOWERING CONSUMERS FOR THE GREEN TRANSITION DIRECTIVE: WHAT’S NEW?

• Overview of the new rules

The Directive introduces amendments to the Unfair Commercial Practices Directive (Directive 2005/29/EC, hereafter “UCPD”) and the Consumer Rights Directive (Directive 2011/83/EU, hereafter “CRD”) and:

• Prohibits or regulates certain advertising practices and green claims that can be misleading for consumers (e.g., generic environmental claims, claims on future environmental performance, carbon offsetting claims);
• Strengthens the rules on sustainability labels; and
• Introduces new guarantee information requirements.

In particular, the following commercial practices are considered unfair and thus prohibited:

• Making generic environmental claims (such as “environmentally friendly”, “eco”, “green”, etc.) not supported by a recognised excellent environmental performance;
• Making claims that a product has a neutral, reduced or positive impact on the environment in terms of greenhouse gas emissions based solely on carbon offsetting;
• Displaying a sustainability label that is not based on a certification scheme or established by public authorities (in other words, a company’s own labels will no longer be allowed);
• Making environmental claims related to future environmental performance (e.g., “by 2030 we will be...”) if not supported by clear and verifiable commitments, targets and other elements relevant for its implementation and if not monitored by third party experts;
• Making environmental claims about the entire product or business when the claim actually concerns only a certain aspect of the product or a specific activity of the trader’s business (e.g., claiming that the product is “made with recycled materials” when only the packaging is made of recycled materials);
• Presenting requirements imposed by law as distinctive features of the product (e.g., claiming that a product does not contain a chemical substance when that substance is already prohibited);
• Providing unclear information to consumers with regard to software updates (e.g., that these are necessary when they only enhance functionality features or when they could negatively impact the functioning of the product);
• Conveying unclear information about the durability, repairability and circularity of goods (e.g., claiming that the good can be repaired when it cannot or withholding information concerning the impact on the functionality of the product when non original spare parts are used).

In addition to the rules on environmental claims, the Directive also requires economic operators to provide consumers with information about the two years legal guarantee of conformity (via a harmonised notice), as well as the complementary commercial guarantee of durability, if offered (via a harmonised label).  Furthermore, a repairability score expressing the capacity of a good to be repaired or information about the availability of spare parts is introduced.

• Entry into force and transposition

The Directive entered into force on 26 March 2024. Member States, including Belgium, need to transpose the measures laid down in the Directive via national legislation by 27 March 2026. Such measures will then become applicable as from 27 September 2026.

• More rules in the making

The new rules laid down in the Directive will soon be complemented by additional measures contained in the so-called Green Claims Directive, which will establish detailed rules on the substantiation and communication of explicit environmental claims and labels. The Green Claims Directive is still under negotiation and is expected to be finalised after the European elections in June 2024.

4. CONCLUSION AND RECOMMENDATIONS

Although the current legal framework in Belgium already offers certain means to combat greenwashing and unfair environmental claims, the Empowering Consumers for the Green Transition Directive will provide a more solid rulebook for consumers, competitors, the Economic Inspection of the FPS Economy and law enforcement (which is likely to increase).  Companies will need to comply with stricter rules regarding advertising practices and green claims, use of sustainability labels and guarantee information. Consumers will also need to be informed on sustainability aspects of their purchase through a repairability score and information on availability of spare parts. And more is coming, as further rules can be expected with the upcoming Green Claims Directive.

For consumers, this is undoubtedly good news. For companies, the new rules will require a more careful approach for using green claims. As a general rule of thumb, it is recommendable to think twice before making a green claim: avoid vague and/or absolute claims, be transparent and provide clear and accurate information, back up your claims with evidence and make sure that specific claims are adequately substantiated. Seek legal advice prior to communicating your efforts to consumers.  

Authors: Anna Kovaleva & Anna Cooreman