Publication of law of 9 June 2026 implementing Directive (EU) 2024/825 as regards empowering consumers for the green transition and updated Q&As published by EU Commission

On 9 June 2026, the law implementing Directive (EU) 2024/825 as regards empowering consumers for the green transition (ECGT) through better protection against unfair practices and through better information (Directive) was published in Luxembourg (Law). The Law amends the Luxembourg Consumer Code and follows the approval of bill of law 8648 (Bill) by the Luxembourg Parliament at first reading on 21 May 2026, with the second vote having been exempted.

As outlined in our previous newsflash on the Bill (available here), the Law pursues the two principal objectives of the Directive: (i) to strengthen consumer information regarding product guarantees and warranties, product life cycles and their reparability; and (ii) to combat unfair commercial practices, particularly those relating to early obsolescence of goods, misleading environmental claims (“greenwashing”), and misleading information concerning the social characteristics of products or companies.

The Law will enter into force on 27 September 2026, i.e. the date by which companies will be required to have brought their commercial practices, including environmental claims and the use of sustainability labels, into compliance with the new requirements, irrespective of whether the products concerned are already on the market.

On 18 May 2026, the EU Commission published an updated version of its questions & answers related to the Directive (Q&As).

Set out below are a few of the key highlights in the Q&As:

• Clarification of the material scope

The Q&As specify that the Directive does not alter the general scope of the Directive 2005/29/EC concerning unfair business-to-consumer commercial practices in the internal market(UCPD) and thus applies to B2C commercial practices only. The focus is on how products and companies are presented to consumers through marketing and commercial communications, rather than on their intrinsic characteristics or composition.

• Environmental claims

The Q&As shed further light on the interpretation of the definition of “environmental claims” that “imply” a positive or zero impact on the environment. The introduced definition is broad in scope and includes imagery and overall product presentation (i.e. layout, choice of colours, images, pictures, sounds, symbols or labels). Professionals (“commerçants”) should therefore exercise caution when using images (e.g. trees, rainforests, water, animals) and colours (e.g. blue or green backgrounds or text) that are associated with environmental sustainability.

• Impact on brand names and product names

Commercial practices implemented through brand names, product names and company names are not excluded from the scope of the Directive. Such names may constitute environmental claims and must be assessed on a case-by-case basis, taking into account the overall commercial context, including visual elements, packaging and marketing materials.

Simply using terms such as “green”, “blue”, “eco” or “natural” does not automatically constitute an environmental claim. The key question is whether, in the relevant commercial context, their use would lead the average consumer to expect an environmental benefit. Where such an association is likely, the professional must specify the environmental claim in clear and prominent terms on the same medium. Failing that, the claim is treated as a generic environmental claim, requiring the professional to demonstrate recognised excellent environmental performance.

With regard to brand names and product names that constitute misleading or generic environmental claims in breach of substantive law, such as the UCPD, they may be refused registration or invalidated under trademark law. Member States retain discretion in this area, including with respect to pre-existing names already protected by intellectual property rights. National authorities should, in principle, be able to act against professionals using such names without being constrained by existing intellectual property rights.

Finally, while individual trademarks are unlikely to qualify as “sustainability labels” given the requirement for commercial distinctiveness, “certification marks” as defined under the Trade Mark Directive (EU) 2015/2436 may function as sustainability labels where they promote a product, process or business by reference to its environmental or social characteristics. In such cases, professionals may only display them if they are established by a public authority or based on a qualifying certification scheme.

• Generic environmental claims

In principle, a generic-sounding term, such as “green” or “gentle on the environment”, appearing on a sustainability label will not be considered a generic environmental claim, in contrast to a standalone claim on the same medium. However, it may still constitute an environmental claim if it creates the impression of a positive, zero, or reduced environmental impact. Sustainability labels must therefore still be carefully assessed. In contrast, a narrower claim, for example “this packaging was made from 100% renewable sources”, would be considered a specific environmental claim and is subject to other criteria determining whether it is permitted.

In practice, specifications must be provided next to, or as part of, the claim, in clear and prominent terms on the same medium. Crucially, lack of space, for instance on packaging, does not justify omitting the specification. If there is insufficient space to specify the claim, the claim should generally not be made at all.

• Certification scheme

The Q&As provide clarifications regarding the certification scheme on which a sustainability label should be based. It confirms the five cumulative criteria set out in the Directive that a qualifying certification scheme must meet, such as the fact that the certification must be based on independent third-party verification and that the requirements and terms must be publicly available.

The Q&As further state that the independence requirement can only be satisfied if the scheme owner and the third-party certifier are two legally separate entities. The Law goes beyond the “two legal entities” formulation and requires that the certifier be genuinely independent from both the scheme owner and the professional, with that independence grounded in recognised EU or national standards.

All sustainability labels in use as of 27 September 2026 must comply with these requirements. No transition period is provided. Schemes that do not meet the criteria must be adapted beforehand, or the associated labels withdrawn from commercial communications.

The Directive affords flexibility in terms of scheme design and monitoring procedures, allowing each scheme owner to set its own requirements, developed in consultation with relevant experts and stakeholders, and for the monitoring to be based on international, European Union or national standards and procedures adapted to sector or product-specific circumstances.

• Application to financial market players

 While the Law is primarily targeted at B2C commercial practices and does not amend product-specific legislation – such as the UCITS framework governing retail fund products – its unfair commercial practices provisions are not sector-specific and may, in principle, extend to financial services, including investment products marketed to retail consumers.

Financial market players, including asset managers and investment firms, should therefore consider whether their commercial communications making environmental or sustainability-related claims (such as references to “green”, “sustainable” or “responsible” investment strategies or products) may come under the scope of the Law’s greenwashing provisions. Where sectoral legislation, such as MiFID II, IDD or the SFDR, already governs specific aspects of those commercial practices in a more detailed manner, those rules shall prevail pursuant to Article 3(4) of the UCPD.

Regulatory guidance is expected to specifically address the interaction between the Law and financial sector legislation. Meanwhile, financial market players are encouraged to review their commercial communications against both the Law’s requirements and their existing sectoral obligations, including applicable CSSF and CAA guidance and ESMA’s guidelines on ESG-related terms in fund names.

• Looking ahead

With less than four months remaining before the provisions of the Law become applicable, the window for achieving compliance is getting smaller and in-scope companies should already be taking the relevant steps to comply with the new provisions.

Companies are encouraged to conduct a thorough review of their commercial practices to ensure that all communications (from branding and packaging to future performance commitments) are transparent and supported by clear, verifiable evidence. those who contravene the applicable provisions may be subject to a fine ranging between EUR 251 and EUR 120,000, a compliance order, or an action for cessation or injunction.

Author : Camille Roche