What businesses need to know about environmental claims and greenwashing

With Directive (EU) 2024/825 the European Union aims to introduce explicit and clear rules on potentially unfair commercial practices and the provision of information to consumers in the context of the “green transition”.

Although it is a key measure under the Recovery and Resilience Plan, the Directive has not yet been transposed into Bulgarian legislation, however, in this relation a draft bill is already submitted to the Parliament. Member States were required to implement it in their national laws by 27 March 2026, as the relevant rules will apply from 27 September 2026, regardless of whether national transposition has taken place. Accordingly, the actual preparation window for businesses is short and requires advance planning, irrespective of whether the legislative process has been completed.

What is changing

The Directive expressly expands the “black list” of prohibited unfair commercial practices by adding specific misleading practices that will be regarded as unlawful in all circumstances. These include false, inaccurate or unsubstantiated claims relating to environmental performance and sustainability, where the new guidance and evidencing rules will allow competent national authorities to effectively monitor and sanction such practices.

What this means in practice for businesses

The risk is not merely “reputational”. On the one hand, from 27 September 2026 the Directive will be binding and capable of having direct effect, and most probably the legislative process will be completed shortly. On the other hand, false and unsubstantiated “green” claims also create regulatory risk: (i) under the Consumer Protection Act (in light of the amendments introduced in 2021 to which the Guidelines on the interpretation and application of Directive 2005/29/EC on unfair commercial practices apply) and (ii) under the rules on unfair competition, breaches of which may be sanctioned by fines of up to 8% of the undertaking’s total turnover.

Companies should exercise particular caution in relation to: (i) general “eco”, “green” or “environmentally friendly” messaging; (ii) sustainability claims that apply only to part of a product or activity; (iii) “future claims” framed as targets or commitments that cannot be verified; (iv) the use of sustainability marks or labels without a transparent certification logic; and (v) sustainability comparisons that are not based on a clear methodology.

What to do by 27 September 2026

• carry out a compliance review of all “green” claims across channels and identify those that are general, unclear or difficult to substantiate, in order to reduce risk;
• establish an internal process and rules for structuring and substantiating such key claims.

How can we help?

EY, as an organization with highly qualified professionals across a range of disciplines (EY Law Partnership & EY denkstatt), can support businesses with:

• Preliminary screening of “green” claims across campaigns/ channels.
• Review, analysis and refinement of specific wording (what can and cannot be said, and how to say it correctly).
• A checklist and/or internal rules for teams, including in relation to the minimum evidence package.
• Review of product certification standards (ecolabels) against the minimum criteria under ISO 14020 and the scope of the claims.
• Greensight.ai tool assessment: Pre-publishing identification of high-risk claims with AI.
• Practical training for marketing and sales teams, sustainability departments, compliance etc. (including legal requirements, examples, a risk management approach, etc.).
• Representation before administrative authorities and courts;