European Commission Announces Intention to Withdraw EU Green Claims Directive Proposal, Although the Status Remains Unclear

On 20 June 2025, the European Commission (Commission) announced its intention to withdraw the proposal for a Directive on Green Claims (the Green Claims Directive Proposal). This announcement follows a letter dated 18 June 2025 to the EU Commissioner for Environment, Water Resilience, and a Competitive Circular Economy, from the European People’s Party (EPP), the largest political group in the European Parliament (Parliament), calling for the Green Claims Directive Proposal to be withdrawn.

The withdrawal of the proposal will not affect the existing EU anti-greenwashing consumer protection framework, including the Empowering Consumers for the Green Transition Directive (Green Transition Directive).

Background on the EU Green Claims Directive Proposal and Status

The Green Claims Directive Proposal was initially proposed by the Commission in March 2023, seeking to ensure that environmental labels and “green” claims are reliable, comparable, and verifiable across the EU. The proposal was aimed at enabling consumers to make better-informed purchasing decisions by establishing minimum standards for the substantiation, communication, and ex-ante verification of explicit environmental claims and labelling schemes.

Following the Green Claims Directive Proposal, the Parliament adopted its position at first reading on 12 March 2024. The European Council (Council) adopted its position on 17 June 2024 (see our related “2024 Year in Review” article), which was to be the basis for negotiations with the Parliament on the final shape of the directive. The first trilogue was held on 28 January 2025. Just before the final trilogue negotiations that were scheduled for 23 June 2025, the Council decided to cancel the meeting with the Parliament in light of the Commission’s announcement. The chairs of the responsible committees at the Parliament commented that they are ready to continue negotiations as soon as possible by resuming the inter-institutional conversations.

Currently, the Commission has not yet released a formal position and justification regarding the withdrawal of the Green Claims Directive Proposal. Case law of the European Court of Justice suggests that the Commission cannot just withdraw a legislative procedure without justification, if the Council and/or the Parliament have adopted a first-reading position, unless both institutions support the withdrawal.

Concerns From the EPP and Omnibus Simplification

In the letter regarding the Green Claims Directive Proposal which prompted the Commission’s announcement, shadow rapporteurs from the EPP expressed support in general for rules addressing greenwashing, but stated that requirements under the Green Claims Directive Proposal “risk unduly hindering sustainability communication through procedures that are overly complex, administratively burdensome, and costly”.

The primary concern highlighted by EPP lawmakers was the requirement for companies to have information verified by an independent third party before making an environmental claim, a principle called “ex-ante” verification. This far-reaching requirement was stated to be difficult to reconcile with the objectives of competitiveness and administrative simplification. For more details on the Commission’s proposal, see our Client Alert.

Such concerns arise at a time when simplification of administrative burdens is a priority, with various “Omnibus” proposals for legislative amendments designed to simplify and streamline EU sustainability regulatory frameworks. These Omnibus proposals are reported to align with the Commission’s Competitiveness Compass commitment to deliver at least a 25% reduction in administrative burdens, in line with recommendations from the Draghi Report. The EPP emphasises this commitment in its letter, arguing that the Green Claims Directive Proposal, and its ex-ante verification principle in particular, undermine this.

For more information on the Omnibus package, see this Latham blog post.

Existing EU Anti-Greenwashing Framework and Consumer Protection Rules, Including the Green Transition Directive, Remain in Force

Notwithstanding headlines that the EU is “abandoning” or “killing” its anti-greenwashing rules by withdrawing the Green Claims Directive Proposal, the position is more nuanced. With the Green Claims Directive Proposal still being subject to adoption, greenwashing investigations and litigation against companies have been brought based on the general consumer protection framework under the Unfair Commercial Practices Directive (UCPD), as implemented in the Member States.

Moreover, the Green Transition Directive was adopted by the EU in February 2024 and will begin to apply from 27 September 2026. The Green Transition Directive further reinforces the anti-greenwashing consumer protection framework under the UCPD, and will introduce specific prohibitions regarding environmental claims, including regarding climate neutrality and net zero, or “eco-friendly” statements, unless substantiated with evidence. It further contains specific rules in relation to sustainability labels, their recognition by certification schemes, and third-party monitoring of future environmental performance claims.

The Green Transition Directive will not be affected by the withdrawal of the Green Claims Directive Proposal. In their letter, the EPP shadow rapporteurs expressed their support for the former, and note that “the implementation of [the Green Transition Directive], and in particular its effective enforcement by member states, will play a crucial role in addressing greenwashing”.

On a broader level, further interrelated EU initiatives, including regarding the circular design of products, remain in force: the Ecodesign for Sustainable Products Regulation, which aims to improve the circularity, energy performance, recyclability, and durability of products placed on the EU market; the Right to Repair Directive, which aims to reduce waste and bolster the repair sector; as well as more product-specific frameworks, such as the EU Batteries Regulation.

Next Steps

At this stage, there has not been a formal announcement from the Commission of its intention and the justification for the withdrawal of the Green Claims Directive Proposal, or on the official position of the Parliament or the Council regarding the withdrawal.

Latham & Watkins will continue to provide further updates as the ESG regulatory landscape, consumer protection, and anti-greenwashing rules evolve.

This article was prepared with the assistance of Samantha Banfield in the London office of Latham & Watkins.