---
title: "We call our product climate neutral"
description: "Since 27 September 2026, claiming that a product has a neutral, reduced or positive greenhouse gas impact because emissions are offset is an unfair commercial practice in all circumstances under the Unfair Commercial Practices Directive, as amended by Directive (EU) 2024/825. Remove offset-based product claims, keep only claims based on the product's actual life-cycle impact, and present carbon credit funding separately."
type: "problem"
url: "https://www.conphora.com/solutions/problem/climate-neutral-claim/"
markdown: "https://www.conphora.com/solutions/problem/climate-neutral-claim.md"
locale: "en"
language: "en"
updated: "2026-10-04"
author: "Conphora compliance team"
publisher: "Conphora"
source: "https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:02005L0029-20260927"
tags: ["sustainability-claims"]
license: "Free to quote with attribution and a link to the page"
---

# We call our product climate neutral

Since 27 September 2026, claiming that a product has a neutral, reduced or positive greenhouse gas impact because emissions are offset is an unfair commercial practice in all circumstances under the Unfair Commercial Practices Directive, as amended by Directive (EU) 2024/825. Remove offset-based product claims, keep only claims based on the product's actual life-cycle impact, and present carbon credit funding separately.

## Why this happens

Climate claims based on offsetting were the most visible target of Directive (EU) 2024/825. The directive amends the Unfair Commercial Practices Directive 2005/29/EC and adds point 4c to Annex I, the list of practices that are unfair in all circumstances: "claiming, based on the offsetting of greenhouse gas emissions, that a product has a neutral, reduced or positive impact on the environment in terms of greenhouse gas emissions". Member States had to adopt the national measures by 27 March 2026 and apply them from 27 September 2026 (Article 4(1)). [2]

The recitals explain the reasoning and give examples. Such claims mislead consumers into thinking they relate to the product itself or its supply and production, or that consuming it has no environmental impact. Examples given are 'climate neutral', 'CO2 neutral certified', 'carbon positive', 'climate net zero', 'climate compensated', 'reduced climate impact' and 'limited CO2 footprint'. Claims should only be allowed when based on the actual life-cycle impact of the product, not on offsetting emissions outside the product's value chain (recital 12). [2]

Because the practice is on the Annex I list, it is unfair as such. There is no case-by-case test of whether the average consumer was misled (Article 5(5) of the UCPD). A label from an offsetting programme does not change this. The same directive also bans sustainability labels that are not based on a certification scheme or set up by a public authority (Annex I point 2a). [1]

Two routes stay open. First, a company may advertise its investment in environmental initiatives, including carbon credit projects, as long as that information is not misleading (recital 12). Second, claims about the product's own reduced emissions can be made if they are specific and can be substantiated: under Article 12, an authority or court can require evidence and treat the claim as inaccurate without it. [1][2]

Targets are claims too. Article 6(2)(d), inserted by Directive (EU) 2024/825, makes it a misleading action to make an environmental claim related to future environmental performance without clear, objective, publicly available and verifiable commitments set out in a detailed and realistic implementation plan. The plan must include measurable and time-bound targets and other elements such as allocation of resources, and be regularly verified by an independent third-party expert whose findings are made available to consumers. [1]

## How to solve it

1. **Find every climate claim and every climate label** Search packaging, product pages, ads and retailer listings for 'climate neutral', 'CO2 neutral', 'carbon neutral', 'net zero', 'climate compensated', 'reduced climate impact' and 'limited CO2 footprint', and for logos of offsetting programmes. Several of these are examples the directive itself gives (recital 12).
2. **Establish what each claim rests on** For each claim, find out whether it rests on offsetting of emissions outside the product's value chain, or on a measured reduction in the product's own life-cycle emissions. Many claims mix both. Only the second part can carry a product claim.
3. **Remove the offset-based product claims** A claim that the product is neutral, reduced or positive for greenhouse gas emissions because of offsetting is banned in all circumstances. Remove it from packs in the next print run and from all online channels. A third-party 'climate neutral' logo based on offsets falls under the same rule.
4. **Say what you actually did, in specific terms** Where the product's own life-cycle emissions were reduced, say by how much, compared with what, for which part of the life cycle and how it was measured. Investment in carbon credit projects may be described, as long as it is not presented as making the product neutral.
5. **Back future targets with a verified plan** A target such as 'net zero by 2040' is a claim about future environmental performance. It needs clear, public and verifiable commitments in a detailed and realistic implementation plan, with measurable, time-bound targets, resources, and regular verification by an independent expert whose findings are public.

## What you need to show

- **List of climate claims and labels per product and channel, with the basis of each** — Marketing and sustainability (Directive 2005/29/EC Annex I point 4c)
- **Life-cycle calculation behind any reduction claim kept** — Your sustainability function or an external consultant (Directive 2005/29/EC Article 12)
- **Implementation plan and independent verification reports for future targets** — Management and an independent third-party expert (Directive 2005/29/EC Article 6(2)(d))

## If you do nothing

- **Banned without any test of the effect on consumers** — Claiming, based on offsetting of greenhouse gas emissions, that a product has a neutral, reduced or positive impact on the environment in terms of emissions is on the list of practices unfair in all circumstances (Directive 2005/29/EC Annex I point 4c; Article 5(5)).
- **Future targets without a plan are misleading** — An environmental claim on future performance without clear, objective, public and verifiable commitments in a detailed and realistic plan, regularly verified by an independent expert, is a misleading action (Directive 2005/29/EC Article 6(2)(d)).
- **Competitors and authorities can act** — Member States must give persons with a legitimate interest, including competitors, the means to take legal action or bring a complaint before an authority (Directive 2005/29/EC Article 11(1)). Penalties are set nationally (Article 13).

## Questions

### May we still buy carbon credits and talk about it?

Yes. The ban does not prevent companies from advertising investments in environmental initiatives, including carbon credit projects, as long as the information is not misleading and complies with Union law (Directive (EU) 2024/825 recital 12). It must not suggest the product itself is neutral.

### Is 'reduced CO2' also covered?

If the reduction comes from offsetting, yes: the ban covers neutral, reduced and positive impact claims based on offsetting. A reduction in the product's own life-cycle emissions can be claimed if it is specific and substantiated (Directive (EU) 2024/825 recital 12).

### Does the ban apply to company-level claims?

Point 4c concerns claims about a product, meaning a good or a service (recital 12). A claim about the whole business falls under point 4b if it concerns only one activity, and a net zero target is a future claim under Article 6(2)(d). An offset-based company claim can still mislead under Article 6.

### From when does this apply?

Member States had to adopt their national rules by 27 March 2026 and apply them from 27 September 2026 (Directive (EU) 2024/825 Article 4(1)). The consolidated UCPD on EUR-Lex shows the new points from that date.

## Sources

1. [Directive 2005/29/EC on unfair business-to-consumer commercial practices (consolidated text of 27 September 2026)](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:02005L0029-20260927) — EUR-Lex, 2026-10-04
2. [Directive (EU) 2024/825 on empowering consumers for the green transition](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:32024L0825) — EUR-Lex, 2026-10-04