Background

The Directive forms part of a wider package of EU initiatives stemming from the European Green Deal, the Circular Economy Action Plan, and the New Consumer Agenda, all aimed at achieving climate neutrality by 2050. 

The European Commission found that over half of environmental claims assessed in the EU were vague, and 40% lacked supporting evidence. Therefore, the Directive is aimed at protecting consumers against unfair commercial practices such as greenwashing, premature failure of goods, and unreliable sustainability labels. In addition, it aims to provide consumers with clear, trustworthy information about the environmental, social, and circular impacts of products and services.

What are some of the key changes

New information requirements 

The Directive introduces new pre-contractual information requirements. Before purchase, consumers must be provided with information about:

• the minimum period for software updates product durability and lifespan
• environmentally friendly delivery options
• a new standardised notice reminding consumers of their two-year legal guarantee of conformity under EU law. Additionally, a harmonised label must be used to identify products where the manufacturer provides a commercial guarantee of durability exceeding two years at no additional cost to the consumer
• repairability scores where available
• availability of spare parts and after-sales repair services, and any limitations when using non-original parts. Businesses must also not claim a product is repairable when it is not, nor falsely suggest that using non-original parts will harm the product when this is not the case.

The Directive also expands what “material information” businesses need to tell consumers about. The list now includes information about availability, composition, durability, repairability and recyclability. 

Banned unfair practices and misleading actions

The Directive creates 12 new banned practices which are considered automatically unfair under EU consumer laws. This includes:

• Prohibition of generic environmental claims
  The Directive prohibits generic, unsubstantiated environmental claims such as "eco-friendly," "green," "nature positive," or "carbon-friendly" unless the product has demonstrably excellent environmental performance. For example, conformity with EU Ecolabel requirements. Businesses can no longer rely on vague terminology without robust supporting evidence.
• Restrictions on carbon neutrality claims
  Critically for many businesses, the Directive prohibits claims that a product has a neutral, reduced, or positive environmental impact based on the offsetting of greenhouse gas emissions. Claims such as "carbon neutral" or "net zero" may only be made where they reflect the actual lifecycle environmental impact of the product or company. Businesses may still promote their support for environmental initiatives, including offset projects, but must not present these as direct compensation for their own emissions. 
• Restrictions on claims based on greenhouse gas offsetting
  The Directive bans claims that a product has a neutral, reduced or positive impact on the environment based on offsetting of greenhouse gas emissions (for example, “climate net zero” or “limited CO2 footprint”)
• Restrictions on sustainability labels
  The Directive adopts a broad definition of "sustainability label," encompassing any trust mark, quality mark, or symbol that implies environmental or social benefits. Such labels are only permitted if they are based on a certification scheme or established by public authorities, developed in consultation with relevant experts and stakeholders, transparent and credible, and verified by an independent authorised third party. Self-created labels and unverified certification schemes are prohibited.
• Prohibition of misleading whole-product claims
  Environmental claims that refer to an entire product or business when they only apply to a specific component are prohibited. For instance, claiming a refrigerator is "energy efficient" solely because of its LED lighting, or describing a company as "green" based only on reducing business travel emissions when this represents a small fraction of overall environmental impact, would constitute banned practices.
• Prohibition on marketing legal requirements as distinctive features
  Businesses may not promote legal requirements as a distinctive feature of their product. For example, advertising a two-year warranty when this is mandatory under EU law, or informing consumers that harmful chemicals are absent from a product when those chemicals are already prohibited, would constitute an unfair commercial practice.
• Software update transparency
  For digital goods and services, businesses must not present software updates as necessary for the product to function when in fact it only enhances functionality. Businesses must also not withhold from consumers that a software update will have a negative impact on how a product functions.
• Prohibition of planned obsolescence practices
  The Directive specifically targets practices designed to limit product durability, such as promoting products with built-in features that limit their lifespan, making false claims about product durability, and encouraging premature replacement of consumables like printer ink cartridges before they are actually depleted. 

The Directive also makes clear that the following practices may be considered misleading:

• Making claims about future environmental performance, such as "carbon neutral by 2030," unless supported by clear, objective, publicly available, and verifiable commitments; an implementation plan with measurable and time-bound targets; and regular verification by an independent third party. 
• Advertising benefits to consumers that are irrelevant and do not result from any feature of the product in such a way that may mislead consumers into believing products are better for them, society or the environment than they actually are. For example, advertising that paper sheets do not contain plastic.

Enforcement and penalties

As the Directive amends existing EU consumer protection legislation, established enforcement mechanisms apply in each Member State.

Penalties vary between Member States, but could potentially be very high as under previous legislation  Member States had to allow fines of at least up to 4% of annual turnover or at least €2 million for widespread infringements. 

Relevance to UK businesses

Although the UK is no longer a member of the EU, UK businesses will need to comply with the Directive if they do business with EU consumers. Non-compliance risks enforcement action by EU national authorities, potentially very large penalties, reputational damage, and loss of access to the EU market.

The UK also has its own developing framework for regulating green claims which businesses may also need to comply with in addition to the EU rules. The Competition and Markets Authority (CMA) published its Green Claims Code in 2021 and has since issued further guidance, including on supply chain responsibilities. Since 6 April 2025, under the Digital Markets, Competition and Consumers Act 2024 (DMCCA), the CMA has acquired direct enforcement powers which mean that it can investigate misleading environmental claims, require undertakings, order remedies, and impose fines of up to 10% of global turnover without recourse to the courts. The Advertising Standards Authority (ASA) also actively polices environmental claims in advertising. 

Practical steps you can take now

The new Directive introduces extensive compliance obligations, including potentially needing to make changes to the consumer purchase journey. In light of the scope of these requirements, we recommend taking steps at the earliest opportunity.

Businesses should consider:

• Auditing consumer purchasing journeys to ensure all new information requirements are being met and information is being delivered by proper means at the appropriate time
• Reviewing all environmental claims across marketing materials, packaging, websites, and investor communications. 
• Checking if all claims can be properly substantiated with robust, verifiable evidence based on lifecycle methodologies and, where necessary, independent third-party verification. 
• Whether any sustainability labels are used and if so, ensuring they are based on certified schemes or established by public authorities, and that they meet the Directive's transparency and verification requirements. 
• Implementing internal governance processes for approving environmental claims, including review by legal and compliance functions, and maintain an audit trail of evidence and sign-offs. 
• Training sessions for product, marketing, legal, and sustainability teams on the new requirements and establish clear lines of responsibility for compliance.