Is the end of 'green advertising' looming?

Sustainability and environmental protection significantly influence consumer behaviour. Companies respond by advertising with 'climate neutrality' or 'environmental neutrality' and substantiate this with self-created seals to convey a sustainable image. Will this still be possible in the future? The EmpCo Directive is coming …

1. Between sustainability promises and greenwashing: A thin line

Advertising statements such as 'climate neutral', 'environmentally friendly' or 'ecological' are often criticised because they make promises that are not kept. When companies present themselves as more environmentally friendly than they actually are, this is referred to as greenwashing. Greenwashing can occur through concrete statements or through subtle references such as symbols, seals or design elements that suggest environmental compatibility. Whether an advertisement is misleading is regulated in Germany by the Act Against Unfair Competition (UWG). In December 2024, the Federal Ministry of Justice submitted a discussion draft for the Third Act Amending the UWG. This Act is intended to implement the requirements of Directive (EU) 2024/825 (short: EmpCo Directive) into national law. The EmpCo Directive serves to strengthen consumers for ecological transition through better protection against unfair practices and through better information. The EmpCo Directive, which was adopted in early 2024, sets comprehensive standards to combat greenwashing in a targeted manner. In addition to ecological advertising statements, it also targets so-called 'social claims' that emphasise social responsibility. In future, companies must take into account numerous restrictions and proof obligations in order to continue advertising with sustainability.

2. Stricter regulations for environmentally related advertising

The EmpCo Directive establishes uniform rules for the entire EU and makes certain advertising practices directly prohibited. In addition, it defines strict requirements that companies must meet in order to make 'green' or 'social' statements.

2.1 Per se prohibition of certain practices

A central element of the EmpCo Directive is the expansion of the 'blacklist' of prohibited commercial practices (Annex to § 3 Absatz 3 UWG). Some of these directly concern common practice in sustainability communication:

Restriction of sustainability seals: In future, only seals issued by public authorities or by a third party that has established a certification system for its seal may be used. Independently developed seals that do not meet verifiable standards are prohibited. Companies must make certification systems publicly accessible and establish independent audit procedures. This significantly increases the effort and could result in the use of sustainability seals being substantially reduced.

Prohibition of general environmental statements: Statements such as 'green', 'environmentally friendly' or 'climate-friendly' are only permitted if companies can demonstrate outstanding environmental performance. It is not sufficient to use these terms vaguely or indefinitely. All statements must be clearly defined and verifiable.

Misleading through imprecise reference points: Statements that concern only individual aspects of a product but present comprehensive environmental benefit are also prohibited. An example would be the claim that a product is 'made from recycled material' if this only applies to the packaging.

Advertising with climate neutrality: Particularly significant is the prohibition on statements that base climate neutrality on compensation measures. Companies are no longer permitted to advertise 'climate-neutral' products if the CO₂ balance is only balanced through compensation rather than through actual reductions. This regulation reflects the EU's aim to favour genuine emissions reductions over offsetting measures.

2.2 Requirements for permissible advertising statements

In addition to the per se prohibitions, the Directive provides that environmentally related and socially related statements are subject to strict burden of proof requirements:

Transparency in social characteristics: In addition to ecological aspects, companies may only advertise social characteristics such as fair working conditions or human rights if these are substantiated. Terms such as 'sustainable' or 'conscious' must be comprehensively defined in advertising.

Information on future performance: Statements about planned ecological improvements are only permitted if these are based on clearly documented, verifiable targets. An independent expert must regularly monitor progress.

3. Timeline

EU Member States are obliged to transpose the EmpCo Directive into national law by March 2026. The corresponding legislative process has already been initiated in Germany. Given the forthcoming federal election, it is not expected that the UWG amendment will be enacted in the short term. However, there is still some time before the end of the transposition deadline. Companies in Germany must therefore prepare for changes to the UWG that will come into force at the latest from September 2026. The EmpCo Directive does not allow for deviations ('full harmonisation'). This already makes it clear that 'green' advertising will be comprehensively regulated in the future.

These new requirements entail substantial adjustments for companies' marketing. In particular, proof obligations, transparency requirements and the restriction of sustainability seals require higher investments in scientifically sound evidence and documentation. Statements such as 'climate neutral' will practically only be possible in exceptional cases where they can be justified without compensation measures.

However, the new legal situation also offers opportunities: Companies that advertise with sustainability in a credible and demonstrable manner can distinguish themselves from competitors and strengthen consumer confidence. Those who ignore the new requirements, on the other hand, risk legal consequences. These can include cease-and-desist claims, damages claims or cease-and-desist letters from consumer associations or competitors. Consumers themselves can also directly assert claims for damages

Conclusion

The EmpCo Directive and the expected national provisions for its implementation represent a turning point in the regulation of
sustainability advertising. Companies face the challenge of examining their statements more carefully, substantiating them more transparently and
documenting them more comprehensively. However, those who implement these requirements in good time can also benefit from the new regulations by leveraging credible sustainability as a competitive advantage.