No excuse for non-compliance! New CMA greenwashing guidance for the fashion industry in the UK

The ambitious approach to tackle greenwashing in the fashion industry taken by the UK Competition and Markets Authority (CMA)  continues, with the launch of a new practical compliance guide for fashion businesses, and a word of warning for 17 unnamed fashion brands to review their business practices. The CMA has made it clear that the new example-based practical guide “means there’s no excuse for using misleading claims” and reminded businesses that failure to ensure practices are aligned with consumer protection rules could carry a risk of up to 10% global turnover of the Digital Markets Competition and Consumers Act (DMCCA); when those powers take effect in Spring 2025. 

Who does this concern?

The guidance makes clear that all stakeholders in the supply chain for the supply of clothes, footwear, fashion accessories and related services (such as packaging, delivery and returns) are responsible for ensuring their claims are accurate and substantiated. 

Main themes emerging from the guidance

The guidance adopts a new example-based approach which helps businesses understand what practices the CMA is likely to consider more ‘misleading’ than others, in order to build compliance infrastructure within their business models. 

The guidance is divided into three main categories of advice for businesses: presenting green claims in store and online; product descriptions and marketing; and substantiating claims. The following themes emerge from the examples cited by the CMA across these divisions:

• Broad and opaque terms (such as “sustainable”, “recycled”, “sustainable”, or “organic”) may be misleading. The CMA favours specific terms which reflect how a product has been designed and/or manufactured. 
• The preference for specificity also applies to comparisons between products, the ‘general mood’ created around a product (for example through the use of images), as well as general claims made by a business, for example, in relation to their business aims and goals to develop sustainability.
• The basis for any claims, including accreditation, qualifications and/or substantiations, should be clear and easy for customers to access. 

Impact of the guidance

The guidance is a welcome addition for businesses ahead of the implementation of the DMCCA which will bring significant consequences for non-compliance with consumer laws. It is not only the fashion industry which can derive some greater certainty from the new guidance. Significant parallels can be drawn between the CMA’s approach in its green claims guidance and its pricing and urgency claims open letter to businesses. Though these consider different practices, they also provide useful information on the CMA’s assessment of compliance, enabling businesses to take advice and action now to ensure compliance and manage potentially significant risk.  

However, it should also be noted that the guidance does not specify where the line between lawful and unlawful practice is drawn in every case. It remains for individual businesses to assess, in the round, whether the claims they make about their products are sufficiently clear and substantiated to fall on the ‘right’ side of the line.

Enforcement v advisory letters?

We note that, along with publishing the guidance, the CMA has issued letters to 17 unnamed fashion brands to review their business practices.

While this approach stops short of the targeted enforcement action that the CMA took against Asos, Boohoo, and George at Asda (albeit with the CMA’s current limited powers), it’s clear that this sector remains a focus for the CMA, and further enforcement action may follow if businesses fail to take appropriate steps to ensure compliance. 

Fashion businesses, and other consumer businesses making similar claims, would therefore do well to consider, and act on, the guidance ahead of the implementation of the DMCCA.