Talk Green, Prove Green: What the EU’s new consumer rules mean for business

From 27 September 2026, businesses engaging with consumers in the EU face more specific rules on environmental claims, sustainability labels, durability and repairability. The EU’s new green claims regime marks a significant shift in consumer protection law and sends a clear message to businesses: if you want to talk green, you need to prove it.

These changes arise from the EU Empowering Consumers for the Green Transition Directive (the “ECGTD”). The ECGTD is designed to tackle misleading environmental claims, improve consumer information and give shoppers greater confidence when making sustainability-related purchasing decisions. The message from regulators is clear: businesses can and should communicate genuine sustainability achievements, but they must be able to substantiate what they say.

Readers may also be familiar with the proposed Green Claims Directive, which would have introduced even more detailed substantiation and verification requirements. However, its progress stalled in summer 2025. The rules taking effect from September 2026 instead arise under the ECGTD, which amends the EU’s existing consumer protection framework, including the Unfair Commercial Practices Directive.

Although the ECGTD does not apply directly in the UK, it may still influence the direction of travel for UK consumer protection and regulatory practice. The UK’s existing consumer protection regime can already be used to tackle misleading environmental claims, and businesses operating across both the UK and EU should keep developments under review.

Which businesses are most affected?

The ECGTD applies to business-to-consumer commercial practices, including advertising, packaging, labelling, website content, online marketplaces and other consumer-facing communications. 

In practice, a wide range of businesses are likely to be affected, including:

• Fashion and textile brands promoting sustainable collections, recycled materials or ethical sourcing credentials;
• Beauty and cosmetics businesses making claims regarding natural ingredients or environmental benefits;
• Food and beverage companies making sustainability, carbon or climate-related claims;
• Consumer goods manufacturers promoting environmentally friendly products or packaging;
• Technology and electronics businesses highlighting durability, longevity or repairability; and
• Retailers and online marketplaces displaying sustainability labels or environmental product descriptions.

UK businesses should not assume the rules matter only where they sell directly to EU consumers. Risk may also arise where a UK supplier adds environmental claims or sustainability messaging to a product knowing that an EU retailer or other intermediary will use that product and messaging in marketing to EU consumers. The precise position will depend on the facts and the relevant national framework.

Why was the ECGTD Introduced?

Sustainability sells. But, for regulators, that has created a problem.

The European Commission became concerned that consumers were being confronted with a proliferation of vague claims, competing labels and difficult-to-verify sustainability messaging, making it harder to distinguish genuine environmental benefits from marketing spin.

The ECGTD is intended to restore trust and create a more level playing field by ensuring that environmental claims are clear, credible and supported by evidence. In particular, it targets:

• misleading environmental claims;
• unsubstantiated sustainability labels;
• misleading information about product durability and repairability;
• practices that encourage premature product replacement; and
• other practices that may distort consumers’ purchasing decisions.

Key changes under the new rules

The Unfair Commercial Practices Directive already contained provisions that could be used to challenge greenwashing, but the ECGTD developed these further and, among others, introduced provisions specifically to regulate common greenwashing risks. These include:

1. Generic environmental claims are prohibited

One of the most significant changes is the prohibition of generic environmental claims unless the claim is made specific in clear and prominent terms or is supported by “recognised excellent environmental performance”.

This may affect claims such as:

• “Eco-friendly”;
• “Environmentally friendly”;
• “Green”; or
• “Climate friendly”.

That does not mean businesses can no longer promote legitimate environmental benefits, but the rules are detailed. It is not enough simply to hold supporting evidence in case the claim is challenged. The specific environmental benefit should be clearly explained alongside the claim itself so that consumers can understand exactly what environmental attribute is being promoted. For example, if a business describes packaging as “environmentally friendly”, it should explain what environmental benefit it is referring to and be able to substantiate it. The evidence must support the specific claim being made.

Alternatively, a generic claim may be used where it is supported by “recognised excellent environmental performance”. This is a specific concept under EU law and should not be understood in its ordinary sense. It does not simply mean that a product or business has strong environmental credentials, has won an industry award or considers itself environmentally responsible.

2. Sustainability labels are restricted

The ECGDT introduces stricter controls on sustainability labels; broadly, these are voluntary trust marks, quality marks or similar that promote a product or business by social or environmental characteristics. In consumer marketing, sustainability labels are prohibited by the ECGTD unless they are:

• Established by a public authority; or
• Based on a certification scheme meeting specified transparency and credibility requirements.

This is intended to reduce consumer confusion caused by the growing number of private or self-created environmental labels.

3. “Carbon Neutral” and similar claims are further regulated

Claims suggesting that a product has a neutral, reduced or positive environmental impact based solely on offsetting greenhouse gas emissions are prohibited. Claims must be based on the product’s actual lifecycle impact. Affected claims may include:

• “Carbon neutral”;
• “Climate neutral”; or
• “Climate compensated”.

What are the consequences of non-compliance?

The costs of getting sustainability claims wrong can be significant. Businesses may face regulatory enforcement action, fines, injunctions and consumer redress measures, with maximum penalties of at least 4% of annual turnover in the relevant Member State(s) or €2 million where turnover figures are unavailable.

Whilst the ECGTD seeks to harmonise certain consumer protection rules, enforcement remains a matter for individual EU Member States. Businesses should therefore keep under review the local enforcement frameworks in the key jurisdictions into which they market or sell products.

Businesses may also face challenges from consumers, consumer groups and competitors. Where the business is not selling directly to consumers, there still might be a risk of suppliers being caught by warranties and indemnities within the supply chain. Beyond legal risk, a greenwashing allegation can quickly erode consumer trust, attract negative publicity and trigger wider scrutiny of a business’s ESG credentials.

How can we help?

We help organisations share their environmental and social impact with confidence, so genuine achievements can be promoted in a way that is clear, credible and compliant. We can help businesses understand how the ECGTD may affect their environmental claims, marketing practices and contractual arrangements, particularly where UK businesses sell to, market to or supply products for EU consumer markets. For practical steps businesses can take now, including auditing claims and labels, reviewing evidence, dealing with existing stock and checking contractual arrangements, see Article 2 in this series here.

We can provide clarity on how the ECGTD operates and its implications for environmental claims and the sustainability label regimes. We are also part of two law firm networks, the Parlex network and the Global Alliance of Impact Lawyers, through which we can connect clients with lawyers in EU jurisdictions. If you need advice on the application of the ECGTD in a particular Member State, we would be happy to help you identify appropriate local counsel and work alongside them where needed.

If you would like to discuss how the new rules may affect your organisation, please contact Richard Marke, Oliver Scutt or Laura Scott.

We advise organisations at the forefront of sustainability and the circular economy, from reusable packaging and resource recovery to responsible supply chains and environmental data. Our Corporate and Commercial team helps clients navigate the contracts, collaborations, governance and regulatory issues involved in bringing innovative sustainable models to life.

The material in this article is provided for guidance and general information only and is not intended to constitute legal or other professional advice on which you should rely. In particular, the information should not be used as a substitute for a full and proper consultation with a suitably qualified professional. Please contact the Bates Wells team if you require further information.