On 18 September 2024, the Competition and Markets Authority (“CMA”) published guidance to help fashion businesses comply with the Green Claims Code and consumer law when making environmental claims about their products (including clothing, footwear and fashion accessories) and related services.. 

This follows an investigation by the CMA into the green claims of three well-known fashion retailers that concluded in March 2024 (of which an update can be found in our recent article).  

Green claims and greenwashing continue to be an area of consumer law focus for regulators. At the time of publishing this latest guidance, the CMA also issued letters to 17 well-known brands advising them to review their businesses practices and reminding them of the CMA’s enforcement powers.  In particular, the CMA took the opportunity to restate that its powers will soon be strengthened under the Digital Markets, Competition and Consumers Act 2024, which will enable the CMA to issue fines of up to 10% of businesses global turnover should they breach consumer law (the powers will take effect from Spring 2025). Compliance has therefore never been more important for businesses. The CMA has made it clear that the new example-based practical guide “means there’s no excuse for using misleading claims”.

Overview of the Practical Guide

The CMA’s practical guide, Complying with consumer law when making environmental claims in the fashion retail sector, aims to drive compliance with consumer law and create a level playing field for all businesses in the sector. It is intended to provide businesses with practical advice to help them comply with the principles of the Code and with the consumer protection law which underpins it, to ensure that consumers are not misled.

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. This includes manufacturers, suppliers (including third party branded suppliers), wholesalers and distributors.

The guide adopts an example-based approach, including mock-ups of retailer webpages, adverts and wording to demonstrate the recommendations in action.  Below is a summary of the guide’s key themes.  

Presenting green claims (in store/online)

• Simply having an accurate claim is not enough – how consumers see and verify such claims is essential to them not being misled. Claims must be clear, identifiable and in plain language. Consumers should be able to easily access and understand the information relating to environmental claims. This means that the information should not be hidden and consumers should not have to take additional steps to access it. 
• It is necessary to consider the presentation of a product’s environmental claim and its information. This can take the form of in-store displays to websites’ drop-down menus and hyperlinks, with consideration being given to whether any claim and its corresponding information is on the same side of a product tag or only accessible through a QR code. Information necessary to substantiate a claim should be presented close to its location. Further online considerations include the use of navigational tools and filters on websites – for example, a filter for ‘sustainable’ products may be too wide, whereas a ‘50%+ recycled’ filter may be more suitable. 

Product descriptions and marketing 

• The guidance applies to the various stages of a product’s life cycle and how these are communicated – from the different fabrics that a product is comprised of to the clothing range that it is a part of. For example, when describing the product itself, it is necessary to refer to the objective properties of each material it is made from and to label these accurately (such as ‘recycled polyester’ versus ‘environmentally conscious nylon’) and the corresponding percentages of the materials used (unless these are ‘negligible’ or items such as zips, buttons or thread). 
• Vague terms for products or ranges, such as ‘green’, sustainable’ or ‘eco-friendly’, have the potential to mislead. Additionally, ranges with environmental claims should have set and clear criteria and only include products that conform to that criteria. It is not just words that have the potential to mislead either: using images and emojis that convey a product’s characteristics as being more environmentally friendly than they are, may be categorised as misleading to consumers too. 

Claims in relation to third party products and services

• Knowing how the products are sourced, produced, packaged, delivered and returned are essential when making claims. An environmental claim will need to be clear about which part of the product’s life cycle it applies to – and so if claims are made and are reliant on third parties for their accuracy and fulfilment, extra care should be taken when applying these to products. 
• It is necessary to ensure any affiliations and accreditation schemes are accurate and verifiable as part of a product or range’s description. 

Substantiating claims 

• Businesses presenting environmental targets and strategies need to do so in verifiable ways, such as stating how and when these targets are to be met, consider which specific part of the product’s life cycle they are referring to and communicate these to customers clearly. It is also necessary to consider the overall presentation of claims made given the greater cumulative impact that these will have on consumers. 
• The CMA states that it is necessary to (i) back up any claims before they are made, (ii) have robust, credible, relevant and up-to-date evidence for claims, and (iii) ensure that internal processes minimise and correct mistakes when listing products. The CMA also recommends putting processes in place to make sure claims are correct, such as checking each claim can be backed up and is accurate through internal processes, policies, training for staff and systems to ensure product listings remain correct and advertised as such. 

Conclusion

1. Whilst the guide is not legally binding on businesses, it is a welcome addition and does clearly set out the CMA's expectations of compliance with the Green Claims Code and provides businesses with a steer of how, in the CMA's view, they can minimise the chances of consumers being misled by the environmental claims they make. It does not however specify where the line between lawful and unlawful practice is drawn in every case it remains individual businesses’ responsibility to assess whether their claims fall on the ‘right’ side of the line. 
2. Importantly, as well as thinking about the specific issues highlighted in the guidance, businesses need to look at all their practices in the round. Businesses should consider whether they need to make other changes to ensure they comply with the law.

Although addressed to the fashion sector, the guidance provides helpful guidance to any business making consumer-facing environmental claims. 

With our extensive environmental and retail expertise, we can support businesses navigating these legal considerations. If you want to hear more about how we can help you in this space, please get in touch with Victoria Barnes or Richard Hugo, or click here to find out more about our environmental and retail expertise. 

Written by Victoria Barnes and Michael Higgs.