Proposal for a Directive on substantiation and communication of explicit environmental claims (Green Claims Directive)

On 22nd of March 2023 a proposal of the Directive of the European Parliament and of the Council on substantiation and communication of explicit environmental claims (Green Claims Directive) has been published by the European Commission.

This proposal is based on Article 114 of the Treaty of the Functioning of the European Union (TFEU), which applies to measures that aim to establish or ensure the functioning of the internal market, while taking as a base a high level of environmental protection

The proposal aims to ensure the functioning of the internal market for economic actors operating in the internal market and consumers relying on environmental claims. The measures proposed in this Directive will increase the level of environmental protection, while leading to further harmonisation regarding the regulation of environmental claims, and would avoid market fragmentation due to diverging national approaches that were introduced or would be introduced in the absence of rules at EU level.

The Proposal of the Directive states that penalties can be imposed: Member States shall ensure that when penalties are to be imposed in accordance with Article 21 of Regulation (EU) 2017/239449, the maximum amount of such fines being at least at 4 % of the trader’s annual turnover in the Member State or Member States concerned.

The Directive shall not apply to sustainability information involving messages or representations that may be either mandatory or voluntary pursuant to the Union or national rules for financial services, such as rules relating to banking, credit, insurance and re-insurance, occupational or personal pensions, securities, investment funds, investment firms, payment, portfolio management and investment advice


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