The Düsseldorf Higher Regional Court (OLG) has ruled in a major legal dispute regarding the legal requirements for climate-neutral advertising. The case concerned the Wettbewerbszentrale, which took action against the companies Katjes and the jam manufacturer Mühlhäuser. The aim of the lawsuit was to obtain a ruling on companies’ duty to inform consumers when they advertise with the term “climate neutral”. In two separate rulings (OLG Düsseldorf, judgment of July 6, 2023 – 20 U 152/22 and 20 U 72/22), the court came to different conclusions about the transparency of the advertising measures.
Legal dispute over “climate-neutral” advertising: decision against Katjes and Mühlhäuser
The Wettbewerbszentrale argued that the advertising with the term “climate neutral” was misleading, as consumers could wrongly assume that the production process was completely emission-free. In fact, however, the companies had used compensatory measures, such as supporting climate protection projects abroad, in order to achieve a balanced carbon footprint. In the opinion of the Wettbewerbszentrale, it would have been necessary to explicitly inform consumers about the type of climate neutrality and the compensation measures implemented in order to avoid misleading expectations. Although this advertisement appeared in the Lebensmittelzeitung, which is primarily aimed at a specialist audience, consumers could also read the magazine and mistakenly understand the advertisement as a promise of complete climate neutrality.
Climate-neutral advertising and transparency for consumers
The Higher Regional Court of Düsseldorf clarified that climate-neutral advertising is not automatically misleading. The decisive factor is whether consumers are sufficiently informed about the actual climate contribution of the advertised product. According to the court, climate neutrality does not necessarily mean that no emissions are generated during production. Instead, the average consumer is aware that “climate-neutral” advertising refers to a balanced carbon footprint, which can be achieved both by avoiding emissions and through offsetting measures. As long as companies communicate transparently how the advertised climate neutrality is achieved, advertising with the term is permissible. Transparency about climate neutrality is crucial in order to meet consumers’ information needs and support them in their purchasing decisions.
Breach of the duty to inform and legal consequences
According to the court, a claim for injunctive relief exists if the advertiser breaches its duty to provide information in accordance with Sections 5 and 5a of the German Act Against Unfair Competition (UWG). Katjes complied with these requirements by placing a QR code in the advertisement, which consumers could use to access a website with detailed information on the carbon footprint and compensation measures. Mühlhäuser, on the other hand, did not provide any information on how climate neutrality was achieved – neither on the product packaging nor in the advertisement itself.
Climate-neutral advertising therefore remains a challenging topic in which companies must fulfill a detailed duty to inform their customers. Climate-neutral advertising can be a strong sales argument if the legal requirements for transparency and consumer information are consistently met.
Importance of transparency in climate-neutral advertising for companies and consumers
The Düsseldorf Higher Regional Court’s decision highlights the central role that transparency plays in climate-neutral advertising. In times of increasing climate protection initiatives and growing consumer awareness of sustainability, companies often find themselves under strong competitive pressure to advertise their products as environmentally friendly or climate-neutral. However, terms such as “climate-neutral” or “CO2-neutral” also harbor risks if they are not adequately explained. According to the Consumer Advice Center and other interest groups, there is a risk that customers will be misled by unclear advertising claims and perceive the advertised product as emission-free or significantly more environmentally friendly than it actually is. Customer trust in companies that advertise sustainability is particularly fragile in the wake of “greenwashing” debates.
The duty of disclosure and the requirements for climate-neutral advertising require companies to provide detailed and precise information on the measures they have taken to achieve climate neutrality. This includes, for example, compensation projects in which CO2 emissions are offset through reforestation or other environmental projects. The companies should not only describe the projects, but also explain the extent to which they contribute to reducing emissions. Katjes set an example of transparent communication by making the detailed information available via the QR code in the ad, which gave consumers access to the specific carbon offset projects.
These requirements make it clear that climate-neutral advertising must be thought through not only from a marketing perspective, but also from a legal perspective. Clear and transparent communication not only creates trust among customers, but also protects companies from legal consequences and strengthens the brand image in the long term.
