Translated using ChatGPT service.
According to the European Commission's estimates, about half of all green claims, such as "Eco," "organic product," "green," "environmentally friendly," "sustainable," and "climate-friendly," in EU member states are unclear, misleading, or unfounded, with 40% used without any justification. This creates confusion for consumers and undermines trust in companies' claims about their products' sustainability.
To address this issue, the European Commission has prepared a proposal for a European Parliament and Council directive on substantiating and making explicit environmental claims, known as the Green Claims Directive.
The draft proposal stipulates that all companies using green claims for their products or services must adhere to minimum standards regarding how these claims are substantiated and their compliance with the stated environmental claims must be announced and made available for verification. The directive focuses primarily on the substantiation of environmental claims and the communication and provision of this information (i.e., supporting evidence) to both consumers and regulatory authorities.
Regarding environmental statements, they must comply with certification schemes verified by a third party and be independently verified. These statements must be data and evidence-based, ensuring that a company's claim about the environmental benefits of a product or service is truthful. Unlike mandatory eco-design requirements for products, making environmental claims about a product is at the company's discretion. The new conditions will also impose additional administrative burdens on supervisory authorities, as detailed requirements for supervision, complaint handling, and the imposition of penalties are planned.
Contrary to the European Commission's initial proposal, the Belgian presidency's proposal includes micro-enterprises within the scope of the directive, although the potential impact assessment of the specified requirements on business operations was not conducted. The directive also provides for the establishment of an additional penalty system for non-compliance, even though existing EU legislation, such as the Unfair Commercial Practices Directive, already imposes penalties for knowingly misleading consumers.
Latvia supports the objective of the planned directive - to introduce clear rules that protect consumers from greenwashing, strengthen their rights, and promote sustainable consumption and the green circular economy in the EU. However, Latvia believes that the proposed solution in the directive imposes an excessive administrative burden on companies, especially small and medium-sized enterprises and micro-enterprises, as well as supervisory authorities.
It is unacceptable to increase the administrative burden on small companies, which often struggle to cope with existing obligations due to limited resources. Demanding the same documentation and evidence from micro-enterprises as from large corporations puts them at a significant competitive disadvantage and hinders their growth. The EU already lags behind other global regions in terms of competitiveness, and should focus on reducing, not increasing, bureaucratic burdens," emphasized the Minister of Economics, Viktors Valainis.
Given these concerns, Latvia did not support the compromise text of the Green Claims Directive prepared by the Belgian presidency at the Environmental Council meeting this week. Latvia's position at the meeting was represented by the Minister of Climate and Energy, Kaspars Melnis; the position on the draft directive was prepared by the Ministry of Economics and approved by the Cabinet of Ministers. It is important to note that Germany, Slovakia, Austria, and Italy also did not support this proposal, resulting in the Belgian presidency failing to obtain the qualified majority of member states needed for a general approach. During the meeting, the Belgian presidency amended the directive's text, setting an eight-month delayed implementation period for micro-enterprises, which gained Italy's support and the necessary qualified majority of member states for further negotiations with the European Parliament.
Despite these changes, Latvia maintained its initial stance, as it was not convinced that the amendments would alleviate concerns about the directive's administrative burden. Latvia will continue to actively voice and defend the interests of Latvian companies in further negotiations with the European Commission and the European Parliament. Given that the European Parliament's proposals also exclude micro-enterprises from the directive's scope, Latvia remains hopeful that significant changes can be made to the directive's text during the upcoming trilogues with the European Parliament, achieving a result that adequately considers the interests of consumers, businesses, and market supervisory authorities.