Update on EU ‘Empowering Consumers' regulation and organic exports to EU
If you are exporting products to the EU, you may already be aware of EU regulation relating to sustainability claims.
The Empowering Consumers Directive 2024/825, which amends the Unfair Commercial Practices Directive, came into force in March 2024 and must be transferred in national law in EU Member states by March 2026. The ECD or ‘EmpCo’ directive covers a number of areas including information around sustainability claims and the durability and lifespan of products. For those exporting organic food and drink products to the EU, the two areas of the regulation we believe will be most relevant are those relating to displaying sustainability labels/marks and making environmental claims that are unsubstantiated or not based on a product’s entire life cycle.
What the regulation says:
Under ‘misleading practices’ the regulation stipulates that generic environmental claims such as “environmentally friendly,” “green,” or "organic" may only be used if there is “recognised outstanding environmental performance.” Recognised excellent environmental performance is defined as environmental performance compliant with Regulation (EC) No 66/2010 of the European Parliament and of the Council or with national or regional EN ISO 14024 type I ecolabelling schemes officially recognised in the Member States, or top environmental performance in accordance with other applicable Union law. This has caused some concern within the EU organic sector, as worryingly the EU Eco-label Regulation and Type II environmental labels are mentioned under this environmental performance, but the organic regulation is not explicitly mentioned in the list.
Should the organic sector worry?
The short answer is perhaps maybe not. Regulatory experts in the EU we have contacted are of the opinion that organic itself isn’t a generic environmental claim and should instead be regarded a sustainability label. This seems appropriate given that "sustainability label" means any voluntary trust mark, quality mark or equivalent, either public or private, that aims to set apart and promote a product, a process or a business by reference to its environmental or social characteristics, or both, and excludes any mandatory label required under Union or national law.
So what’s the potential problem?
If organic certification qualifies as a sustainability label, using the term organic on the product should be unproblematic. However, as this exemption seems to apply solely to the organic claim and on-pack messaging, it is not clear whether organic products may also be advertised or marketed with other generic environmental statements such as “environmentally friendly” or “biodiversity-friendly", etc. Under the ECD such claims are prohibited unless a "recognised excellent environmental performance" can be substantiated. Ideally, organic production should qualify as a "recognised excellent environmental performance". However, this has not yet been explicitly clarified in the EmpCo Directive. As a result, there remains legal uncertainty and this may persist until such time as a national court in the EU rules on the relationship between EmpCo and the Organic Regulation.
How did this happen?
A draft of the Green Claims Directive, which was intended to serve as the lex specialis to the EmpCo Directive, did address the issue with Recital 9, which clarified that this Directive "should not apply to environmental claims on organically certified products substantiated on the basis of that Regulation, related, for instance, to the use of pesticides, fertilisers and anti-microbials or, for instance, to positive impacts of organic farming on biodiversity, soil or water. It also has a positive impact on biodiversity; it creates jobs and attracts young farmers". While EmpCo itself does not regulate the relationship with the Organic Regulation, the Green Claims Directive was meant to do so. Unfortunately, the GCD is currently stuck in trilogue negotiations in the EU and there are concerns that the Commission may withdraw it altogether. If that happens, we will be left with the EmpCo Directive standing alone and uncertainly.
What should I do now?
More clarity is needed, but if you export organic products to the EU that are within the scope of UK organic regulation, we believe that carrying an organic mark or label should be unproblematic. However, differences of opinion and interpretation may persist. Even more uncertainly exists in relation to other supporting claims - made either on-pack or in marketing material. As the directive indicates that any environmental claim made in written or oral form, including through audio-visual media, that is not included on a sustainability label could be unsubstantiated, until there is clarity regards the full relationship between EmpCo and EC Organic regulation, we recommend caution when making claims. If you are making additional claims, you should ensure additional claims you wish to make are clear, that you have provided a full description of how you substantiate them, and you can fully evidence how you have make this substantiation to the satisfaction of the directive.
Whilst regulatory uncertainty persists, we would recommend caution around the use of all sustainability marks, and – more importantly - that businesses seek expert legal opinion on the any claims they wish to make to ensure they satisfy ECD requirements.