News January 2023: the “Carbon Neutrality” claim is not neutral. Beware of the new penalties/fines for Greenwashing since January 1, 2023!

In two decrees dated 13 April 2022 that came into force on 1 January 2023, the government, seeking to complete the provisions of the 22 August 2021 Climate and Resilience Act, once again tackles Greenwashing from the angle of carbon neutrality claims.

 

 

 

• Reminder:

Since the Climate and Resilience Act, Articles L. 229-68 and L. 229-69 of the Environment Code respectively provide for the prohibition and punbishment of marketing allegations claiming that a product or service is "carbon neutral", unless they comply with some conditions and minimum standards that were yet to be set by decree.

• What is new?

The articles resulting from the first decree n°2022-538 (art. D. 229-106 to D. 229-109 of the Environment Code) specifically target wording confering, without any proof, a carbon neutrality to a product or service.

In order to claim that a product or service is "carbon neutral", it is now required that:

• the product or service's greenhouse gas emissions global assessment shall (i) cover its entire life cycle, (ii) be updated every year and (ii) be carried out in accordance with the requirements of standard NF EN ISO 14067, which defines the requirements for assessing the carbon footprint of products.

• the communication on carbon neutrality shall be the subject to a report available to the consumer on the advertiser's website, which shall (i) detail the method used to establish the emissions balance, (ii) evidence the reality of the compensation of residual emissions, and also (ii) give the targeted trajectory for reducing the emissions associated with the product or service being advertised, with quantified annual progress objectives over ten years.

--> In short, these requirements are so strict and require such a high level of scientific demonstration that they should dissuade many companies from using the carbon neutrality marketing claim lightly, especially since the penalties/fines attached are substantial.

• Article R. 229-110 of the Environmental Code, which was issued by the second decree n°2022-539, sets out the penalties/fines for not-complying with these requirements: after a notification of grievances, possibly followed by a formal notice (which may be made public) from the Minister of the Environment and remained unsuccessful, an advertiser claiming for carbon neutrality without complying with the regulatory requirements may be sentenced to pay the fine provided for in Article L. 229-69, i.e. 100,000 euros for legal entities or 20,000 euros for natural persons, those amounts being possibly increased up to the total amount of the expenses devoted to the illegal operation.

 

• What to remember in practice?

“Carbon neutral”, “zero carbon”, “with a zero carbon footprint”, “climate neutral” ... those marketing claims asserted without proof are now prohibited by the aforementioned decrees when they appear on a certain number of advertising communication media covered. Their use presupposes gathering prior scientific analyses to demonstrate the truth of the claim, subject to substantial penalties, not to mention the  image and reputation damage  that this practice will cause in the long-run !

 

by Sarah Temple-Boyer (Attorney) and Simon Monat (Legal Intern)