EU: Commission and CPC authorities launch greenwashing investigation in respect of green claims made by 20 airlines

The European Commission announced on 30 April 2024 that EU consumer authorities (the CPC Authorities), coordinated by the Commission, have sent letters to 20 airlines identifying several types of potentially misleading green claims and inviting them to bring their practices in line with EU consumer law within 30 days.  The names of the airlines have not been disclosed at this stage of the investigation.  

According to the Commission’s press release, the investigation focuses on claims made by airlines that the CO2 emissions caused by a flight could be offset by climate projects or through the use of sustainable fuels, to which the consumers could contribute by paying additional fees. The authorities are concerned that the identified practices can be considered as misleading actions/omissions, prohibited under Articles 5, 6 and 7 of the Unfair Commercial Practices Directive (UCPD).  The Commission's Guidance Notice on the interpretation and application of the UCPD provides specific information about misleading environmental claims. 

The Commission and the CPC network have identified several types of potentially misleading practices by 20 airlines, such as:

• creating the incorrect impression that paying an additional fee to finance climate projects with less environmental impact or to support the use of alternative aviation fuels can reduce or fully counterbalance the CO2 emissions;
• using the term “sustainable aviation fuels” (SAF) without clearly justifying the environmental impact of such fuels
• using the terms “green”, “sustainable” or “responsible” in an absolute way or use other implicit green claims;
• claiming that the airline is moving towards net-zero greenhouse gas emissions or any future environmental performance, without clear and verifiable commitments, targets and an independent monitoring system;
• presenting consumers with a “calculator” for the CO2 emissions of a specific flight, without providing sufficient scientific proof on whether such calculation is reliable and without the information on the elements used for such calculation; and 
• presenting consumers with a comparison of flights regarding their CO2 emissions, without providing sufficient and accurate information on the elements the comparison is based on.

The Commission and CPC authorities have invited the companies to provide a response within 30 days, outlining their proposed measures to address the concerns arising from their environmental marketing claims under EU consumer law.  

Once it has received replies from the companies, the Commission will organise meetings with the CPC network and the airlines to discuss the solutions proposed by the companies. The Commission will then monitor the implementation of the agreed changes. 

If the airlines involved do not take the necessary steps to address the concerns raised in the letters, the CPC authorities can decide to take further enforcement actions, including sanctions.  

The Consumer Protection Cooperation (CPC) is a network of authorities responsible for the enforcement of EU consumer protection laws. With the coordination of the European Commission, they can take action to address cross-border issues at EU level. Consumer associations such as the BEUC can post “alerts” about emerging market threats which are then assessed by the relevant CPC authorities to decide if the allegations merit further investigation. The current investigation against the 20 airlines was triggered by an earlier BEUC alert. For more information on how the CPC network operates and examples of commitments made by other companies following other investigations by CPC authorities, see here and here. 

The current EU investigation is the latest twist in the already very busy greenwashing landscape in Europe and elsewhere across the globe:  

• Last month, the district court of Amsterdam ruled against a Dutch airline in what has been described as the first decision on greenwashing claims in the aviation industry. The court ruled that a number of statements made by the airline in relation to its marketing campaigns and/or products were misleading and unlawful, and that the airline had acted in violation of the Dutch legislation that implemented the EU UCPD (see our previous blog post).
•  The EU recently adopted a new Directive – the Empowering Consumers for the Green Transition Directive – which amends the UCPD and the Consumer Rights Directive to address a number of marketing practices related to greenwashing and the early obsolescence of goods. 

In particular, the new Directive will ban the use of generic environmental claims (e.g. environmentally friendly, green, biodegradable, etc) unless they are properly substantiated by demonstrating recognised excellent environmental performance. It will also ban claims that a product has a neutral, reduced or positive impact on the environment (e.g. climate neutral) if this is achieved via the use of carbon offsetting schemes. It will also ban claims related to future environmental performance (e.g. in the form of a transition to climate neutrality, or a similar objective, by a certain date) if they are not 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 (such as allocation of resources). The claim would also need to be regularly verified by an independent third party expert, whose findings are made available to consumers. 

To be clear, the Directive does not ban the use of carbon offsetting schemes or advertising such schemes with correct and non-misleading statements. What it bans is making claims about carbon offsets in relation to them having a neutral, reduced or positive impact on the environment and thus giving the impression that the environmental impact of a product or service is neutralised through the offsetting. For more information on the new Directive, see our client briefing. 

It is worth noting that the current EU investigation into the 20 airlines is a good example of the fact that greenwashing allegations may already be caught by the general tests under the existing UCPD - even before the entry into application of the Empowering Consumers for the Green Transition Directive, which will provide more precise requirements in respect of a number of practices. 

• The EU is also in the process of adopting a Directive on the Substantiation and Communication of Environmental Claims, commonly known as the Green Claims Directive. The new Directive will introduce minimum criteria that companies making claims to consumers in the EU about the environmental benefits and performance of their products or services need to meet, as well as minimum criteria for environmental labelling schemes. It’s about how green claims are substantiated and communicated, as well as controlling the proliferation of environmental labels. However, negotiations on that proposal for a Directive will now have to wait until after the European Parliament elections this summer. For more information on the Green Claims Directive, see our blog posts here and here.
• In the UK, the Competition and Markets Authority (CMA) and Advertising Standards Agency (ASA) are also focusing on greenwashing claims and are in the process of conducting various investigations. For more information, see our blog post. 
• Not to mention that financial regulators - in the EU, UK and elsewhere across the globe - are also very focused at the moment on investigating greenwashing allegations in the financial sector, including in respect of how ESG funds are labelled and marketed. 

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