Climate Claims Regulation Tracker

An Overview of some environmental claims regulations across major markets




Published February 2024

Keeping on top of climate claims regulation

With increasing complexity surrounding how companies are allowed to communicate their climate action, staying up to date on the shifting landscape of climate claims regulation can be a challenge. On this page you’ll find a helpful summary of regulatory activity in some of the world’s major markets.

This Climate Claims Regulation Tracker contains useful summaries for a number of jurisdictions for information purposes, with links to the original source legislation, but it is not an exhaustive list. Scroll down to find out how governments in your markets are managing and legislating on this complex area.

Disclaimer: Please note that the information contained herein constitutes a summary prepared by Climate Impact Partners, based on compiled publicly available data. It aims at being general information relating to environmental claim regulations across major markets, but does not aim at being comprehensive or accurate, and does not constitute a legal opinion, and does not aim at being fit for a particular purpose or situation.

Climate Impact Partners shall not be liable for any claims, losses, damages, or liabilities arising from the use of the information contained herein, including but not limited to:

  • Quality: The accuracy, completeness, or reliability of the information contained herein.
  • Comprehensiveness: The inclusion or exclusion of specific data points or categories.
  • Availability: Any interruptions, downtime, or unavailability of the information.
  • Adequacy: The suitability of the information for any particular purpose or situation.
  • Accuracy: Errors, omissions, or inaccuracies in the data contained herein.
  • User Reliance: Any reliance placed by users on the information within the database.

Users are advised to independently verify any information obtained from the database and use it at their own risk.

Full credit is given to the authors of the original published texts.

Europe

European Union (EU)

Regulation

Green claims - European Commission (europa.eu)

March 2022 - Circular Economy: Commission proposes new consumer rights and a ban on greenwashing (first package)

  • The European Commission proposed a package of European Green Deal proposals, that included new consumer rights and ban on greenwashing, amending Directive 2011/83/EU of the European Parliament and of the Council of October 25, 2011 on consumer rights
  • January 17, 2024: Position of the European Parliament with a view of adopting a new directive (EU) 2024/… amending Directives 2005/29/EU and 2011/83/EU

March 2023 - Consumer protection: enabling sustainable choices and ending greenwashing (complements the above by setting rules that are specific to environmental claims) (third package)

  • March 2023: the European Commission adopted a proposal for a Directive on Green Claims, aiming at complementing and operationalising the proposal of a Directive on empowering consumers in the green transition.

Due for Parliament’s review:

Key principles

  • Generic environmental claims and other misleading product information will be forbidden
  • Certification of products with sustainability labels shall be based on approved certification schemes
  • Information has to be more visible and transparent.

United Kingdom

Regulation

Consumers are protected against misleading information and claims, through a number of general and specific regulations, including:

Consumers are protected against misleading information and claims, through a number of general regulations, including:​

Key Principles

  • No unqualified carbon neutral, net zero or similar claims.​
  • If claims are based on offsetting, they should comply with the usual standards of evidence for objective claims set out in the guidance

Switzerland

Regulation

  • Federal Act against Unfair Competition, 1986, that prohibits misleading and deceptive commercial practices
  • Swiss Fairness Commission (SFC): This commission issues principles on fairness in commercial communication, influencing acceptable practices for environmental claims (in 2023, the Swiss Foundation for Consumer Protection filed complaints with SFC against several companies regarding allegedly unfair green claims). On the February 12, 2024, they have issued new guidelines on commercial communications with environmental references.
  • Non-financial Disclosure: Large, public interest companies in Switzerland are obligated to report on environmental and social matters, indirectly promoting transparency around sustainability claims.

Key principles

  • Switzerland prioritizes applying existing general regulations to address greenwashing rather than enacting a dedicated law.
  • Specificity and Evidence: Vague claims are discouraged, with emphasis on clarity, evidence, and verifiability.
  • Evolving Landscape: The interpretation of existing laws is influenced by developments in the EU, like the proposed Greenwashing Directive, suggesting potential shifts in Swiss regulations.

North America

USA

Federal

Federal Trade Commission (FTC) regulates claims through general consumer protection guidelines. Environmental Marketing | Federal Trade Commission (ftc.gov)

The FTC acts as the primary watchdog for misleading advertising practices, including greenwashing. Their "Green Guides" offer non-binding guidance on environmental claims, emphasizing substantiation, clarity, and avoiding vagueness. There is an update ongoing, that has not been published, yet. There was a comment period that was closed on April 24, 2023, and the Commission is currently reviewing comments.

California

Known for its progressive environmental policies, California boasts the nation's most comprehensive green claims law, the California Unfair Competition Law and False Advertising Act. It requires specific criteria and evidence for claims like "recyclable," "compostable," and "carbon neutral."

Other States

Maine and Oregon: These states have enacted laws similar to California's, demanding verifiable evidence for environmental claims and prohibiting broad, unsubstantiated assertions.

Other States: Several other states, including New York, Vermont, Washington, and Maryland, have introduced or considered legislation addressing greenwashing concerns.

Massachusetts doesn't have a dedicated, overarching environmental claims regulation like California's. However, several aspects of environmental claims are addressed through a patchwork of existing laws and policies:

Massachusetts Department of Environmental Protection (MassDEP)

  • Truth in Advertising: MassDEP applies general consumer protection principles to environmental claims, prohibiting misleading and deceptive practices. Their Division of Consumer Protection can investigate and enforce regulations.
  • Specific Product Regulations: For certain product categories like cleaning chemicals, MassDEP establishes minimum environmental requirements and authorized eco-labels. Products must fulfil these criteria to use "environmentally friendly" or similar claims.
  • Environmental Policy Act (MEPA): This act requires environmental review for certain projects, potentially involving assessment of claims made about a project's environmental impacts.

Canada

Regulation

  • The Competition Act is the primary legislation governing green claims in Canada. It prohibits false or misleading advertising, including environmental claims.
  • The Competition Bureau enforces the Competition Act and provides various resources for businesses making green claims. Their Environmental Claims: A Guide for Industry and Advertisersoffers detailed information.

Key principles

  • Claims must be truthful and not misleading
  • Claims must be substantiated
  • Claims should be clear and understandable

Latin America

Brazil

Regulation

  • Mandatory sustainability reporting: Starting in 2026, public companies will be required to disclose sustainability and climate-related information, including greenhouse gas emissions, based on international standards. This will offer more transparency and potentially set the stage for future regulations on carbon neutrality claims. 
  • Draft carbon market law: A draft law is currently being discussed which would establish a cap-and-trade system for carbon emissions. This could indirectly affect carbon neutrality claims, as companies with regulated emissions might need to participate in the market, impacting their claims. 

In addition, some general laws already protect consumers against misleading claims:

  • Consumer Protection Code: Prohibits misleading and deceptive practices in advertising and consumer transactions, encompassing unsubstantiated environmental claims.

Key principles

  • Adopt ethical and transparent practices when making environmental claims. 
  • Follow established guidelines (recognized frameworks like the Greenhouse Gas Protocol, ensuring transparency and credibility in the claims).
  • Substantiate claims.
  • Avoid misleading language.

Colombia

Regulations

Key principles

  • Adopt ethical and transparent practices when making environmental claims. 
  • Follow established guidelines (recognized frameworks like the Greenhouse Gas Protocol, ensuring transparency and credibility in the claims).
  • Substantiate claims.
  • Avoid misleading language.

Africa

South Africa

Regulations

  • Consumer Protection Act: Prohibits misleading and deceptive statements, including environmental claims.
  • Competition Act: Protects consumers from unfair market practices, including misleading environmental claims.
  • Green Finance Taxonomy: (currently under development) aims to standardize definitions and disclosures related to sustainable financial activities, potentially impacting how companies communicate environmental claims.

Other initiatives

  • While not mandatory, ESG reporting is becoming increasingly common in South Africa and helps build trust with stakeholders.
  • The Johannesburg Stock Exchange (JSE) Sustainability Disclosure Requirements require listed companies to report on environmental and social risks and opportunities.

Key principles

  • Claims must be accurate, verifiable, and not misleading.
  • Claims should be clear, specific, and avoid ambiguous terms.
  • Claims should be substantiated with evidence from credible sources.
  • Claims should consider the full life cycle of a product or service and avoid cherry-picking positive aspects.
  • Claims should not create a false impression about the overall environmental impact of the company or its products.

Kenya

Applicable regulation

  • Consumer Protection Act: Prohibits misleading and false advertising, including environmental claims.
  • Competition Act: Protects consumers from misleading representations regarding goods and services.

Other initiatives

Key principles

  • Claims must be accurate, verifiable, and not misleading.
  • Claims should be specific and avoid ambiguous terms.
  • Claims should be substantiated with evidence.
  • Claims should not create a false impression about the overall environmental impact of the company or its products.

Asia Pacific

Japan

Regulation

  • Unfair Competition Prevention Act: Prohibits misleading and deceptive representations, including environmental claims.
  • Japan Industrial Standards sets eco-labelling standards can be used on products.

Other initiatives

Key Principles

  • Claims must be truthful, verifiable, and substantiated with evidence.
  • Avoid ambiguous terms and ensure clarity in the claims.
  • Consider the full life cycle of the product or service and avoid cherry-picking positive aspects.
  • Claims should not create a false impression about the overall environmental impact of the company or its products.

Singapore

Regulation

  • Consumer Protection (Fair Trading) Act: Prohibits misleading and deceptive practices in advertising and consumer transactions. This can apply to inaccurate environmental claims made about products or services.
  • Singapore Code of Advertising Practice: Issued by the Advertising Standards Authority of Singapore (ASAS), this code mandates "legal, decent, honest and truthful" advertising, requiring environmental claims to be accurate and verifiable.

Key principles

  • Focus on Specificity: Vague claims like "eco-friendly" are discouraged, favouring clear and evidence-based statements.
  • Lifecycle Approach: Claims must consider the entire product or service life cycle, not just isolated aspects.
  • Verification and Transparency: Third-party verification and clear justifications for claims are increasingly emphasized.

Australia

Regulation

Key principles

  • Substantiation (support claims them with evidence of emissions reduction efforts, offset investments, and verification processes).
  • Scope and clarity (clear boundaries of the claim (e.g., product-specific, operational) and clarity over any limitations or conditions for achieving neutrality).
  • Avoidance of misleading language (no absolute claims like "carbon neutral" unless they are demonstrably true across the entire lifecycle of the product or service).