EU Empowering Consumers Directive: New Rules on Green Claims Apply From 27 September 2026

From 27 September 2026, the EU’s Directive on Empowering Consumers for the Green Transition (ECGT, also referred to as EmpCo or Green Transition Directive) enters into effect. The ECGT amends both the EU’s 2005 Unfair Commercial Practices Directive (UCPD) and the EU’s 2011 Consumer Rights Directive (CRD). The amendments include new categories of prohibited practices, including specifying that traders should not use vague or generic environmental claims without reliable and verifiable evidence.

In this article, we focus on the practical implications of the ECGT, as well as clarifications included in the most recent Questions & Answers (Q&As) published by the European Commission (Commission) ahead of the 27 September application date. For a comprehensive overview of the EU’s greenwashing and consumer protection framework, including further background to the ECGT, national enforcement trends, and the withdrawn Green Claims Directive proposal, see this Latham article.

Introduction

The ECGT introduces two principal sets of consumer protection measures. First, it strengthens the rules governing environmental and social claims and practices; second, it expands the information consumers must receive about matters such as durability, reparability, and software updates.

While the UCPD previously addressed “misleading actions” and “misleading omissions” in general terms, the ECGT adds specific rules in relation to greenwashing and early obsolescence. These include the addition of environmental and social characteristics and circularity aspects to the UCPD’s list of main product characteristics in respect of which a trader’s practices may be misleading, and adds specific environmental and social practices to the list of practices considered prohibited in all circumstances.

The ECGT does not create a standalone regime; instead, it embeds environmental, social, and circularity considerations into the existing EU consumer protection framework, with the intention of ensuring that environmental claims made to consumers are clear, accurate, and verifiable. As a directive, the measures require transposition across each of the EU Member States, each of which is responsible for its own transposition and enforcement.Transposition has been uneven. On 28 May 2026, the Commission opened infringement procedures against 20 Member States that had failed to transpose the ECGT by the 27 March 2026 deadline; as of 24 August 2026, some Member States had still not completed the process. The current transposition status can be viewed by using the Commission’s National Transposition tracker (available here).

Environmental claims are already being challenged under the UCPD and the national laws implementing it. The ECGT may facilitate further claims by expressly identifying environmental and social characteristics as matters capable of misleading consumers and by designating certain practices as prohibited in all circumstances, without requiring proof that the practice affected the average consumer’s transactional decision. 

Application Scope and Timing

The ECGT operates within the UCPD’s business-to-consumer (B2C) perimeter. It captures “commercial practices”, which include, but are not limited to, marketing, advertising, packaging, labelling, and point-of-sale information directed at consumers at each stage before, during, and after a transaction.

Business-to-business (B2B) and wholesale communications, as well as investor-focused reporting (such as under the Corporate Sustainability Reporting Directive), generally fall outside the ECGT’s scope because they are typically mandatory and addressed to investors rather than forming part of a B2C commercial practice. The distinction, however, between B2C and B2B claims is not always clear-cut in practice, with consumer-facing standards increasingly being used to inform the assessment of B2B claims. Some Member States, such as France, extend some or all aspects of the UCPD to B2B communications under national law, and regulators may also draw on claims made in investor or supply chain documentation when scrutinising consumer-facing statements. Similarly, the Q&As confirm that where a company reuses information from its sustainability report in voluntary consumer advertising, a retail product webpage, social media content, or other consumer-facing marketing, that communication may fall within the ECGT. Accordingly, businesses should consider whether corporate sustainability information is being repurposed to promote their products to consumers. As with all Directives, the practical scope of these rules may differ between Member States, depending both on how the ECGT is transposed and on the extent to which existing national law applies equivalent consumer-protection standards beyond the UCPD’s harmonised B2C perimeter. Businesses will therefore need to consider their operations across the EU and monitor the implementing measures in each relevant Member State, as those measures will determine the national requirements with which their relevant communications must comply.

The ECGT can apply to claims made at enterprise level as well as those concerning a particular product or service. An enterprise-level statement about an entity’s environmental performance, transition strategy, or net zero commitments may be caught where it is directly connected with the promotion, sale, or supply of products or services to consumers. For the ECGT to apply, there must be a B2C element, meaning the communication must be directed at EU consumers. If that threshold is met, the rules apply irrespective of where the entity making the claim is established, meaning that entities located outside the EU (including US entities) that sell, market, or ship products to EU consumers are subject to the ECGT.

There is no transitional relief: from 27 September 2026, traders must ensure that all environmental claims and sustainability labels in B2C contexts comply with the new rules, including for existing products. The Q&A does, however, indicate practical remediation options for existing stock, such as covering or correcting non-compliant claims with stickers, or providing additional information at the point of sale. In addition, in June 2026, the Consumer Protection Cooperation (CPC) Network – a cooperation network between national authorities responsible for the enforcement of consumer protection laws – published a non-binding common understanding on “old stock”. “Old stock” refers to products or packaging displaying environmental claims or sustainability labels that were manufactured, ordered, distributed, or placed on retailers’ shelves before 27 September 2026, as well as historical environmental claims made prior to that date in advertising, promotional materials, or other commercial communications. Under this common position, CPC authorities expect traders to take immediate good-faith steps towards compliance. Such steps include all reasonable and proportionate measures, such as promptly removing or correcting online claims, adapting future packaging and new orders, or applying stickers as noted above. However, the CPC Network also noted that national authorities may take a phased approach on a case-by-case basis where old stock situations give rise to genuine transitional difficulties in the early stages of ECGT application. Relevant factors include packaging cycles, stock volumes, product shelf-life, and other objective practical constraints.

Application to Financial Products and Financial Institutions

Financial institutions are not subject to the ECGT’s amendments to the CRD, which concern information on the durability and reparability of goods, but are within scope of the amended UCPD when engaging in B2C commercial practices. The new rules may therefore apply to consumer-facing claims concerning green loans, mortgages, deposits, ESG-labelled retail funds, and similar financial products and services. They apply alongside any sector-specific sustainable finance disclosure, marketing, and fund-naming requirements.  

Questions & Answers Guidance

On 30 June 2026, the Commission released updated Questions & Answers (FAQ) guidance on the ECGT, providing non-legally binding guidance in response to questions from stakeholders. The document contains 21 questions: 18 concerning updates to the UCPD and three concerning the CRD. The UCPD questions focus on the scope of the ECGT, including the breadth of what counts as an environmental claim (including implied claims, imagery, and brand and product names), the conditions for generic, carbon-neutrality, comparative, and forward-looking claims, and the requirements for sustainability labels and certification schemes, together with the treatment of products being offered for sale ahead of the implementation date. The CRD questions address consumer information on durability and reparability, including reparability scores and the harmonised notice and durability label.

Requirements of the ECGT

The ECGT aims to eliminate vague or unsubstantiated environmental claims, through the amendment of the UCPD and CRD. It does this by including greenwashing-specific language within certain of its existing provisions, as well as by adding certain specific actions to the “blacklist” of practices that will always be considered misleading and therefore no amount of substantiation can save them.

Misleading Actions

Transactional Decision Test

The UCPD prohibits traders from undertaking misleading actions and misleading omissions that may cause the average consumer to make a purchasing decision they would not otherwise have made. A commercial practice is misleading if it contains false information or it is likely to deceive the average consumer, even if factually correct. While these provisions have historically been applicable to green claims, the ECGT includes specific prohibitions in relation to greenwashing and early obsolescence that are more targeted in this area.

The first of these is to include “environmental and social characteristics” of a product as one of the “main characteristics” in relation to which a claim or commercial practice may be misleading.

Future Environmental Performance

Claims about future environmental performance, which may include net zero or climate-neutral pledges, may also constitute misleading actions unless they are supported by “clear, objective, publicly available and verifiable commitments set out in a detailed and realistic implementation plan that includes measurable and time-bound targets and other relevant elements necessary to support its implementation”.

The implementation plan should be regularly verified by an independent third-party expert whose findings are made available to consumers. The Commission’s Q&A suggests that annual or biennial review would reflect best practice, with additional verification if significant changes occur.

To be considered misleading, claims about future environmental performance must cause an average consumer to take a different transactional decision, taking into account the factual context and all features and circumstances.

Irrelevant Benefits

A further potentially misleading action relates to advertising benefits to consumers that are “irrelevant” and do not result from any feature of the product or business. These actions could mislead consumers into believing that the specific product or business is more beneficial to them, the environment, or to society than other products or businesses of the same type. The Commission provides examples of advertising an irrelevant benefit, such as claiming that a particular brand of bottled water is gluten-free or that paper sheets do not contain plastic.

Both claims regarding future environmental performance and irrelevant benefits would be considered misleading subject to a case-by-case assessment.

Misleading Omissions

Separately, traders offering services that compare products by reference to environmental or social characteristics or circularity aspects must disclose the method of comparison, the products and suppliers compared, and the measures in place to keep the information up to date; omitting that information may amount to a misleading omission.

Prohibited Practices

In addition, the UCPD also contains in Annex I a list of specific practices that are considered unfair in all circumstances. For these “blacklisted” practices, there is no need to demonstrate the negative impact of the practice on the average consumer’s transactional decision.

The ECGT adds 12 new Annex I practices, covering sustainability labels, generic environmental claims, partial claims, and several prohibited practices regarding durability and repair. Further details regarding some of these prohibited practices are set out below.

Sustainability Labels

Under the ECGT, sustainability labels refer to any voluntary trust mark, quality mark, or equivalent, that aims to set apart and promote a product, process or business by reference to its environmental or social characteristics. It does not necessarily have to be a registered trademark. A sustainability label can also be considered to exist if a sign is designed in such a way that it looks like a label, e.g. a framed green leaf. A certification scheme is a third-party verification scheme that certifies that a product, process or business complies with certain requirements. The ECGT sets out several criteria for the certification scheme to be used to allow a corresponding sustainability label.

Sustainability labels that are not based on a certification scheme or established by public authorities are prohibited. This would mean self-declared or uncertified labels and in-house “eco” marks are prohibited.

Before displaying a sustainability label, traders should check the certification scheme’s publicly available terms to confirm that it meets minimum standards of transparency and credibility. In particular, the scheme must provide for objective monitoring of compliance with its requirements, carried out by a third party that is competent and independent of both the scheme owner and the trader, judged against international, EU, or national standards and procedures.

Generic Environmental Claims

Generic environmental claims, such as “eco-friendly”, “green”, or “biobased”, where a trader is not able to demonstrate recognised excellent environmental performance relevant to the claim are prohibited. A “generic environmental claim” is defined as any environmental claim (in written or oral form) that is not included on a sustainability label and where the specification of the claim is not provided in clear and prominent terms on the same medium. The ECGT draws a distinction between these generic claims, such as “climate-friendly packaging” and specific claims such as “100% of energy used to produce this packaging comes from renewable sources”, which would not fall under this prohibition. Specifying the claim on the same medium (e.g. ‘packaging made from 80% recycled content’) avoids the generic-claim ban, but the specified claim must still be accurate and substantiated.

Recognised excellent environmental performance can be demonstrated by several methods. This includes by compliance with the EU Ecolabel Regulation,The EU Ecolabel Regulation sets out a voluntary ecolabel award scheme intended to promote product with a reduced environmental impact during their entire life cycle and to provide consumers with science-based information on the environmental impact of products. or with national or regional EN ISO 14024 ecolabelling schemes officially recognised in the Member States,EN ISO 14024 is the international standard specifying the principles and procedures for environmental labelling programmes. or by corresponding to “top environmental performance” for a specific environmental characteristic in accordance with other applicable EU laws. In this case, the recognised excellent environmental performance should be relevant to the entire generic environmental claim.

Partial Claims

Another prohibited practice is making a claim about an entire product or business, when really it only concerns a certain product aspect or activity. For example, promoting a product as “made with recycled material” where only the packaging qualifies.

Offset Claims

Claiming, based on the offsetting of greenhouse gas emissions, that a product has a “neutral, reduced or positive impact” on the environment in terms of greenhouse gas emissions is prohibited. These claims would only be allowed when based on the actual life cycle impact of the product, not based on the offsetting of greenhouse gas emissions outside the product’s value chain.

Definition of Environmental Claims

The ECGT introduces a broad definition of “environmental claim” that covers any message or representation that is not mandatory under EU or national law, in any form, including text, pictorial, graphic, or symbolic representations such as labels, brand names, company names, or product names, made in the context of a commercial communication. Claims include those that state or imply that a product, product category, brand, or trader has a positive or zero environmental impact, is less damaging than alternatives, or has improved its impact over time.

The Commission’s Q&A further addresses the broad scope of the ECGT: brand and product names may themselves constitute environmental claims where terms such as “green”, “eco”, “natural”, or “climate neutral” are likely to create an environmental association, even absent any separate express environmental advertising.

Implicit claims are caught as well as express statements. The Commission’s Q&A indicates that, depending on the circumstances, implied claims may include the use of images (for example, trees, rainforests, water, or animals) and colours (for example, green or blue backgrounds or text) associated with environmental sustainability. There have already been examples of UCPD case law on this point, such as CPC-coordinated action in the fashion sector to remove “misleading environmental icons” displayed next to products, such as imagery including a leaf or tree.

Social Claims

Social characteristics are now material product features, therefore misleading claims regarding working conditions, human rights, and social or ethical engagement, sometimes described as “social washing”, are caught by the same framework.

The Commission's Q&A indicates that social characteristics may extend to matters such as animal welfare, and that terms such as “vegan” or “vegetarian” may qualify as environmental claims or sustainability labels where they imply an environmental or social benefit.

Durability Claims

While most of the ECGT’s amendments are to the UCPD, the ECGT also amends the CRD regarding certain aspects of durability and repair of products. This includes prohibitions on falsely claiming a given durability under normal conditions of use, presenting a good as repairable when it is not, inducing consumers to replace consumables earlier than technically necessary, and withholding or misstating information about the effect of using third-party consumables or spare parts. The CRD amendments require traders to provide clear pre-contractual information on durability, guarantees, and repairability, supported by the harmonised notice and label, the design and content of which the Commission specified through adoption of an implementing regulation on 25 September 2025.

Enforcement

Commercial entities are already facing greenwashing challenges brought by NGOs, consumer organisations, shareholders, and other organised claimants under existing consumer-protection and national laws. These challenges may target both product-level marketing and enterprise-level matters, including sustainability commitments, financed emissions, and alleged inconsistencies between public claims and underlying financing or investment activities. The ECGT provides claimants with more specific grounds on which to challenge consumer-facing communications, while its new blacklisted practices remove the need to establish an effect on the average consumer’s transactional decision.

The ECGT does not, however, create a standalone enforcement regime. It operates through the existing UCPD and CRD systems, which means that remedies and procedures are implemented at national level. In this manner, Member States retain significant discretion, and enforcement models differ widely across jurisdictions: some rely primarily on public authorities, while Germany and Austria, for example, operate substantially private enforcement schemes. This means, for example, that competitors can obtain injunctions within a matter of days through interim relief proceedings and have the use of certain statements prohibited. Individual remedies and representative actions are also available as implemented nationally.

Public enforcement is led by national consumer protection authorities, which must ensure that penalties are effective, proportionate, and dissuasive. Cross-border matters may also be pursued collectively through the Consumer Protection Cooperation (CPC) Network, which has previously coordinated actions under the UCPD in relation to green claims. The ECGT strengthens and reinforces the existing UCPD framework, with the intention of providing traders and enforcers with additional clarity as to when environmental claims will be treated as misleading. Prior examples of enforcement under the UCPD may be beneficial to review as an example of how environmental claims will be targeted going forward.

Penalties

The Modernisation Directive enhances enforcement mechanisms and penalty structures within several EU consumer protection laws, including the UCPD. Following the Modernisation Directive, Member States must provide for maximum fines of at least 4% of the trader’s annual turnover in the Member States concerned, or at least €2 million where information on turnover is not available.

Those figures are minimum requirements, and national ceilings can exceed the EU floor; risk and penalty levels therefore vary by Member State. A June 2024 Commission report noted that several Member States had adopted higher maximum fines in the context of the existing version of the UCPD. Although there is the potential for significant financial penalties, historically, enforcement bodies have often entered into commitments with operators in relation to future conduct rather than imposing direct penalties.

Recommended Actions and Next Steps

With the application date quickly approaching, companies should audit consumer-facing claims across advertising, packaging, websites, product and brand names, and point-of-sale materials, and identify which claims are generic, comparative, forward-looking, or offset-based. Claims that cannot be substantiated on the new basis will need to be qualified, re-evidenced, or withdrawn, and the Commission’s Q&A indicates that stickering or point-of-sale information may be an acceptable interim fix for existing stock.

Existing labels and certifications should be reviewed against the new Annex I criteria, in particular to confirm that each sustainability label is based on a certification scheme or established by a public authority, and to retire self-declared marks. Where forward-looking or comparative claims are to be retained, companies should put in place the underlying implementation plans, independent third-party verification arrangements, and comparison methodologies, together with an accessible route for consumers to reach the supporting evidence, such as a QR code or webpage.

Companies should also track national transposition in key jurisdictions. With infringement procedures opened in May 2026 against Member States for not having yet transposed the ECGT, and the scope for Member States to set higher penalties, apply equivalent rules to B2B communications, or maintain distinct private enforcement routes, risk will vary by market and should be assessed jurisdiction by jurisdiction rather than at EU level alone.

Finally, marketing, product, packaging, and compliance teams will need training on the new standards, and sign-off processes should be updated so that environmental and social claims, including imagery, colour, and naming decisions, are reviewed from a compliance perspective before launch. Companies may also wish to seek advice in developing a group-wide claims standard that can be applied consistently across EU and non-EU markets.

This article was prepared with the assistance of Samantha Banfield at Latham & Watkins.

Latham’s European ESG Practice has experience advising on a broad range of topics related to EU consumer protection, EU sustainability, and international ESG matters. If you have questions about this article, please contact one of the authors listed below or the Latham lawyer with whom you normally consult.