An environmentally conscious lifestyle is becoming increasingly important to consumers. Companies are therefore increasingly advertising with environmental claims. However, numerous competition and environmental associations often see this as inadmissible greenwashing at the expense of the climate, the environment and consumers. This article explains what needs to be taken into account when advertising with green claims.
Admissibility under competition law
The permissibility of advertising to consumers is essentially determined by the Unfair Competition Act (UWG), partly by product-specific requirements of European law.
Unauthorised use of Ecolabels
Always inadmissible is the use of quality marks, quality labels or similar without the necessary authorisation (Annex to Section 3 (3) No. 2 UWG). Companies should therefore not give the impression in their advertising or concrete product presentation that they are allowed to use a certain Ecolabel if this does not correspond to the truth. Incidentally, it is also inadmissible to invent corresponding seals oneself and to advertise with such a quality label that does not actually exist.
“Ecolabels” as quality labels in the sense of competition law can be found on the website of the Federal Environment Agency. These include, for example, the Bio seal, the Green Dot or the EU Ecolabel.
Inadmissibility by misleading
Otherwise, the inadmissibility of environment-related advertising regularly results from misleading statements pursuant to §§ 3, 5 para. 2 no. 1 UWG. This is the case for advertising with untrue statements which are likely to induce the consumer to make a business decision which he would not have made otherwise. The decisive factor here is the impression created by the advertising in the mind of the averagely informed consumer.
Case law applies a strict standard to advertising with environmental protection terms because the advertised environmental compatibility of a product regularly and increasingly has a great emotional influence on purchasing behaviour. At the same time, the concrete meaning of the terms used here, such as “environmentally friendly”, is often unclear. Therefore, when advertising with environmentally related terms, companies should take particular care to provide sufficient and transparent explanations of the chosen terms.
According to the prevailing view in case law, the average consumer assumes with the term “climate-neutral” that the CO₂ emitted during the production and distribution of the products is either saved elsewhere in the sense of a balanced CO₂ balance or subsequently compensated by climate projects or that CO₂ is not emitted at all or is hardly relevant. Depending on their technical and scientific background, consumers could misinterpret the term in the sense of non-existent or irrelevant CO₂ emissions, for example through the use of a CO₂ filter. Only the Higher Regional Court of Schleswig considers advertising with the term “climate neutral” not necessarily misleading, even without explanatory notes. This is because, unlike the fuzzy term “environmental friendliness”, the term “climate neutral” contains a clear statement that can be verified for its truthfulness.
Scope & place of required information
The question of how extensive the supplementary information has to be depends on the addressee of the advertisement. As recently confirmed by the Higher Regional Court (OLG) of Frankfurt am Main, the ambiguity of the environment-related terms continues to affirm that consumers have a heightened interest in being informed. It is true that the concrete scope of the information must always take into account the concrete circumstances, in particular with regard to the target group, the term used, the product advertised, the concrete form of the advertisement, etc., but this is not the case. In this respect, there must be clarity about the object of the advertising and the scope, e.g. whether the advertising refers to a product, a product line, a brand, a sub-brand, a company or a “corporate philosophy”.
Clearly visible informative references are already required in the advertisement. A reference only on the website, however, is not sufficient. Especially in the case of inexpensive mass-produced goods, where quick purchase decisions are made (for example, jam), the reference must be clear in terms of keywords and eye-catching.
If, on the other hand, advertising is exclusively directed at the trade or a specialist audience (for example, in the food magazine), the requirements are less stringent, especially if the specialist addressee is familiar with the terms used and their meaning.
General duty of disclosure
The interest in clarification is also supported by Section 5 a (1) UWG, according to which a consumer may not be deprived of essential information that he needs to be able to make an informed business decision if the deprivation is likely to cause the consumer to make a business decision that he would not otherwise have made.
Outlook: EU reform efforts
In December 2019, the European Commission presented the “Green Deal”, a far-reaching programme for more climate and environmental protection in the EU. The aim is to make the EU the first greenhouse gas-neutral confederation of states by 2050, to significantly reduce pollutant emissions and to further promote the circular economy in Europe. In this context, the EU Commission also has an eye on the increasing advertising with environmental aspects and wants to better protect consumers from unfair advertising by adapting the law.
According to the draft directive COM 2022 (143), the Unfair Commercial Practices Directive (UCP Directive) is to be supplemented. In addition to the extension of the so-called “black list” of prohibited actions, new examples of essential characteristics (e.g. on environmental and social impact, durability & repairability) as well as an explicit prohibition of withholding essential information for comparison portals are planned. In addition, it is intended to supplement the Consumer Rights Directive (CRD) with further information obligations.
It is rather questionable whether the project actually creates a significant added value compared to the already existing regulations. Moreover, this first proposal for a directive will still be amended in the course of the legislative process. It will take at least 1-2 years until the final directive is available and transposed into national law. Therefore, the development should be kept in mind.
Competitors and the competition and environmental associations will pay more attention to the implementation of environment-related advertising in the future. However, companies need not be frightened: Advertising with green claims can be implemented with legal certainty vis-à-vis consumers. Particular attention should be paid to the following:
- when using seals, certifications, etc., ensure that the seal or certification has actually been awarded;
- Do not “invent” your own seals
- Environmental claims must be accurate, correct, substantiated and verifiable;
- Create clarity especially about
- Object of advertising (e.g. product, product range, company or “corporate philosophy”)
- Scope (e.g. production, use)
- Informed decision must be possible, but not unlimited information (general knowledge)
- The information must be included in the advertisement or be clearly visible