Green Claims Directive & EmpCo: Tools Against Greenwashing

The Green Claims Directive was intended to establish clear, EU-wide rules against greenwashing, but it was withdrawn in June 2025. Instead, EmpCo becomes binding. As a result, new requirements take effect on September 27, 2026, governing which environmental claims companies are still permitted to make. In this article, we provide an overview of the developments surrounding greenwashing regulation and take a closer look at the requirements introduced by the new EmpCo.

Many Environmental Claims Do Not Hold Up to Scrutiny

In January 2023, DIE ZEIT and The Guardian published an investigation into Verra, the leading provider of carbon credits. According to their findings, a portion of the emission credits that companies used to offset their greenhouse gas emissions did not deliver real reductions. A study by the European Commission painted a similar picture: more than half the environmental claims made by companies in the EU were vague or misleading, and roughly 40% were entirely unsubstantiated. Many green labels are of little help either, since half of them are barely verified, if at all.

The result is something most people know from their own experience: consumers can barely tell which claim actually delivers on its promise. And companies that properly substantiate their statements get lost in the jungle of labels and claims.

The Green Claims Directive Was Meant to Address This, but It’s Off the Table

On March 22, 2023, the EU Commission presented a draft of the Green Claims Directive (GCD). It was intended to require companies to substantiate their environmental claims scientifically, have them independently verified, and communicate them transparently.

But it didn’t get that far. In June 2025, the EU Commission withdrew the proposal after it lacked a majority in the trilogue and, among others, Italy and the EPP withdrew their support. The main criticism centered on the anticipated bureaucratic burden and the planned inclusion of micro-enterprises.

Anyone breathing a sigh of relief now, however, is mistaken. The Green Claims Directive is not the only regulation against greenwashing, just the best known. The requirements that will actually affect companies starting in fall 2026 have long been settled.

What Is Now Binding: The EmpCo Directive

The Empowering Consumers Directive (EmpCo, an EU directive) already entered into force on March 26, 2024. Member states had to transpose it into national law by March 27, 2026, and it must be applied as binding law starting September 27, 2026. In Germany, implementation takes place through an amendment to the Act Against Unfair Competition (UWG).

EmpCo regulates much of what the Green Claims Directive set out to do, just through a different mechanism: not through a new verification procedure, but through existing competition law. Certain environmental claims will henceforth be considered inherently unfair. This means there is no longer any need for a case-by-case assessment of whether a claim is misleading, it is simply prohibited.

Which Claims EmpCo Prohibits Starting September 2026

EmpCo identifies four categories that will no longer be permitted without solid evidence:

1. General environmental claims without recognized proof of performance
   Terms such as “environmentally friendly,” “green,” “eco,” “sustainable,” “climate-friendly,” or “biodegradable” may only be used if backed by recognized, outstanding environmental performance. This also applies to implicit claims: green leaves, globe symbols, or water droplets on packaging likewise fall under this rule if they suggest an environmental benefit that is not substantiated.
2. Carbon-neutrality claims based on offsetting
   Statements such as “climate-neutral” or “carbon-neutral” that rely on purchased credits are no longer permitted. Climate-related claims must refer to real emission reductions within the company’s own value chain.
3. Self-created sustainability labels
   In-house “eco” or “green” logos without an independent basis are prohibited. Only labels based on a system recognized by authorities or certified by independent third parties remain permissible.
4. Whole-product claims for a partial aspect
   Anyone who prints “made with recycled material” on a product when only the packaging is meant leaves themselves open to challenge. The precise version that transparently states the scope remains permitted, for example, “packaging is made from 90% recycled PET.”

One important point here: forward-looking promises such as “climate-neutral by 2030” are not prohibited outright, but they are subject to conditions. They must be based on a measurable, verifiable implementation plan and monitored by an independent body.

Who Does EmpCo Apply To?

The directive affects all companies that market products or services to consumers in the EU, regardless of size, revenue, or industry. Manufacturers based outside the EU are also covered as soon as they target EU end customers. Unlike the Green Claims Directive that was under discussion, EmpCo does not exempt micro-enterprises.

What’s at Stake for Violations of EmpCo

Advertising with unsubstantiated environmental claims will be subject to cease-and-desist actions and can be penalized with fines. In the case of serious violations, fines of up to 4% of annual revenue in the member state concerned are possible. On top of this come reputational risks: a publicly challenged claim often damages credibility more than any fine.

This is not an entirely new risk, by the way. Back in June 2024, the Federal Court of Justice ruled that advertising a product as “climate-neutral” without explaining whether this is based on avoidance or offsetting is misleading. EmpCo merely makes enforcement considerably easier starting September 2026.

What You Should Do Now

The deadline for implementing EmpCo is no longer far off. Anyone planning product packaging, campaigns, or website copy with a longer lead time is already working today on material that will go live in September 2026.

Three steps are worth taking now:

• Claim inventory: Which environmental claims are you currently using—on packaging, your website, in advertising, and in your sustainability report?
• Evidence mapping: For each claim, check whether solid evidence exists and where it is located.
• Approval process: Define who signs off on an environmental claim before it is published, so that marketing, legal, and sustainability work together.

The core principle remains simple: you may only claim what you can prove. And that requires a solid data foundation. Greenwashing rarely stems from intent. It usually arises when sustainability is communicated without a sound data basis.

We support you with your sustainability communication

Solid claims require solid data. With the VERSO ESG Hub, you capture your sustainability data in a structured and traceable way, from the data source through to the reporting basis. This makes it possible to demonstrate what each claim is based on. For the communication itself, our Sustainability Consultants support you. They help you publish meaningful information while staying truthful, whether in your sustainability report or in other internal and external formats.

* This information is summarized editorial content and should not be construed as legal advice. VERSO accepts no liability.