Environmental and climate-related advertising claims have increasingly been the subject of (not only) German courts for some time (“greenwashing”). After all, such claims – if inaccurate – may in particular violate the prohibition of misleading commercial practices according to § 5 para. 1 UWG as well as the information requirements according to § 5a para. 2 UWG.

As early as the late 1980s, the German Federal Court of Justice therefore determined that a particularly strict standard should apply to advertising with environment-related claims. After all, advertising environmental friendliness has a great influence on the purchasing behaviour of customers and terms such as “environmentally friendly, environmentally compatible, environmentally sound, etc., are often ambiguous, which justifies the increased need for clarification of the relevant public. For this reason, especially in the case of eye-catching advertising with the environmental friendliness of a product and the different perceptions and expectations associated with it, it must be clarified exactly what this environmental friendliness is supposed to result from. Any statement made in this respect must therefore indicate which environmental advantage is to be emphasised in order to exclude the risk of misleading the consumer.

However, a recent decision of the Higher Regional Court of Schleswig (decision of 30.06.2022 – 6 U 46/21) now suggests that advertising with the term “climate-neutral”, unlike advertising with environmental friendliness, is not per se misleading, even in the absence of clarifying information.

Subject of the proceedings before the Higher Regional Court of Schleswig was the claim “KLIMANEUTRAL” (climate-neutral) on the packaging of trash bags as well as the reference that the product would support Gold Standard certified climate protection projects to achieve the UN climate goals. The plaintiff and appellant considered this labelling to be misleading because the claimed “climate neutrality” would refer to the company and not only to the product due to the spatial reference to the company logo, without specifying whether the company itself was climate neutral. Moreover, the claim of climate neutrality would also be misleading if it referred only to the product, because it did not clarify how the claimed climate neutrality was achieved. The Regional Court of Kiel (judgement of 02.07.2021 – 14 HKO 99/20) upheld the action. However, on appeal by the defendant and appellant, the Higher Regional Court of Schleswig overturned the judgement.

According to the Higher Regional Court, the term “climate neutral” imprinted on a household article next to a product logo does not indicate that the producing company exclusively produces climate neutral goods. In contrast to the vague term “environmental friendliness”, the term “climate neutrality” would contain an unambiguous statement, namely the assertion that the advertised products would have a neutral CO2 balance. The court based its reasoning in particular on the provision in DIN EN ISO 14021, which regulates the requirements for environmentally related vendor claims. According to this provision, the term “CO2-neutral” is defined as referring to a product for which the carbon footprint is zero or balanced (cf. DIN EN ISO p. 47 para. 7.17.3.1). The term therefore encompasses both, the decisive factor for “neutrality” being the balance sheet with permissible inclusion of offsetting measures.

However, the claim “climate neutral” does not contain the further statement that the offset balance is achieved through the complete avoidance of emissions during production. This applies all the more if the claim is combined with a clearly visible indication that climate projects are supported in order to achieve climate neutrality. Further explanatory information on the type and scope of the compensation measures is not required. For this reason, the advertising statement “climate neutral” for a product would not be misleading per se. This applies, in particular, if it is simultaneously made clear that climate neutrality is achieved through compensatory measures.

Therefore, although the cited ruling should, under certain circumstances, somewhat ease the requirements for the obligation to inform when using the term “climate neutral”, there remains a considerable risk under German unfair competition law when using such claims. Especially against this background, companies should continue to clarify the respective environmental/climate impact of their products as clearly as possible when using such designations. Finally, the aforementioned ruling is likely not to be the last regarding the assessment of such terms under German unfair competition law.