Greenclaim “climate neutral”: misleading or permissible?

Two diametrically opposed decisions show how difficult it is to use the term "climate neutral" in advertising.

In this case, a manufacturer of household and hygiene products was sued for injunctive relief because it had advertised its bin liners under the brand “X” and a special product line under the sub-brand “X climate neutral”. In addition to this sub-brand, the bin liners and their packaging referred to the support of “Gold Standard certified climate protection projects”.

The Kiel Regional Court finds the advertising to be misleading

The plaintiff had sued the defendant to stop the advertising and was upheld at first instance before the Regional Court of Kiel (LG Kiel, judgment of July 2, 2021 – 14 HKO 99/20) The court classified advertising with the term “climate-neutral” as misleading if the advertised company gives the impression that all of its products are manufactured in a climate-neutral manner. The consumer then relates this statement to the entire company and not just to a specific product. However, if the company manufactures both climate-neutral and non-climate-neutral products, the consumer is given the wrong impression, which can lead to business decisions that they would not otherwise have made. The court emphasized that consumers need clear information about how climate neutrality is achieved, as there are different ways to achieve it. A mere reference to the support of climate protection projects certified according to the Gold Standard is not sufficient in this context. The court demanded that a reference to the website or a QR code be included on the packaging so that the consumer can easily access further information on the term “climate neutral”. The information on the supported climate protection projects must not be hidden on a subpage, but must be easily accessible and placed in the immediate vicinity.

However, in the opinion of the Schleswig Higher Regional Court, advertising is permissible

On appeal, however, the Higher Regional Court of Schleswig (OLG Schleswig, judgment of June 30, 2022 – 6 U 46/21) ruled that the use of the term “climate neutral” was not misleading within the meaning of Section 5 UWG. It would be misleading if the idea created by a statement in the target public did not correspond to the actual circumstances. The understanding of the term “climate neutral” has become established among consumers and they know that it refers to a balanced emissions balance. They also know that compensation measures are necessary and that products such as bin liners cannot be manufactured completely emission-free. There is therefore no need for additional information. In contrast, the term “climate neutral” contains a clear and verifiable statement in comparison to the description of a product as “environmentally friendly”. Information about the support of climate protection projects helps to avoid misunderstandings.

Finally, the OLG found that although the defendant had breached its duty to provide information, it was not possible to provide information on the product itself due to lack of space. Instead, a reference on the packaging to a website with further information, e.g. via a QR code, was sufficient. A detailed statement such as “20% climate-neutral through own efforts and 80% through purchased certificates from climate protection projects” is not necessary and could mislead the consumer due to a lack of reference values.

The future of climate-neutral advertising: final clarification still pending

It should be noted that the question of the requirements for advertising with the term “climate neutral” has not yet been conclusively clarified. In any case, companies should be very careful when advertising their products, as not only environmentally conscious consumers but also competitors pay close attention to how environmental claims are presented in advertising. Transparency and a sense of responsibility are of great importance here in order to avoid possible misunderstandings and legal conflicts. After all, in many cases companies have been sued not primarily by consumers but by competitors. In view of the relevance of the question of when and how the term“climate neutral” may be used in advertising, it is to be hoped that this case will come before the Federal Court of Justice in order to bring about a final clarification. It remains to be seen how the advertising landscape will develop with regard to environmental claims in the coming years. What is certain is that the future Green Claims Directive will play an important role in this.

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