Hungarian Competition Authority Classifies Typical Green Claims

This article is a follow-up to our previous reports on greenwashing (links: Fighting ‘Greenwashing’ – Extensive Sweep Conducted by the Consumer Protection Cooperation Network, Aniko Keller, Lilla Szabo (galalaw.com)

Hungarian Competition Authority Helps Undertakings to Avoid ‘Greenwashing’, Aniko Keller, Lilla Szabo (galalaw.com) 

In its guidance on greenwashing, the Hungarian Competition Authority (“HCA”) discusses and gives recommendations on the proper use of the most typical green claims relating to (i) the makeup of a product; (ii) production processes; (iii) the future of a product and (iv) comparative claims and claims about market-leading status.

If we look at the claims related to the first group of claims, the makeup of the product, we find expressions such as ‘recyclable’, ‘recycled’, ‘refillable’ and the commonly used ‘free from’ and ‘organic’ or ‘bio’ claims.

When using the claim ‘recyclable’, companies should let consumers know about the process and the available options in this regard. If the product is in theory recyclable, however recycling actually does not take place (e.g. due to the lack of such facilities), such a claim may be misleading.

When claiming that a product is recycled, it is recommended to inform consumers whether the packaging, certain parts of it, the whole product or both the product and the packaging were manufactured using recycled materials. It is advisable to use the word ‘recycled’ only if the product would have ended up as waste if not for the recycling process.

When claiming the refillability of a product, companies should provide information about the manner it can be refilled. The HCA notes that the refillability of a product must be realistic. Therefore, claiming that a bottle of wine is refillable on the basis that it can be refilled with water at home may be deemed as misleading.

Highlighting that the product is ‘free from’ a specific ingredient is accepted only if the respective ingredient was not replaced by other materials having the same (or similar) harmful effect. As an example, the HCA mentions the using of a ‘free from’ claim to indicate that a cleaning agent does not contain a specific chemical ingredient when other cleaning agents do not generally contain this ingredient either.

Indicating that a product is ‘organic’ or ‘bio’ is very common nowadays. However, undertakings must ensure that the product and the raw materials used in its production are certifiably organic and that all ingredients are subject to a ‘bio’ product certification.

The second group includes the claims related to production processes, for example, claims related to renewable energy or the longevity and durability of products.

Most importantly, undertakings must ensure that their claims are factually correct, e.g. if a claim is made in connection with the expected lifetime of the product, this must be duly substantiated.

In case of claims relating to longevity and durability, consumers should be provided with the information necessary to achieve the environmental benefit claimed.

As an example, the HCA states that a product cannot be claimed to be carbon neutral if this only applies to carbon-dioxide emissions during its manufacturing process but the use of the product results in carbon-dioxide being emitted.