Competitive Markets Authority examines fashion industry
Within 7 months The UK regulator, the Competition and Markets Authority (“CMAs) announced a review of environmental claims in the fashion retail sector and initiated an investigation of such environmental claims by various fashion companies, including ASOS and George at Asda. It came less than a year after being notified by the CMA to ensure that the green claim was legally compliant.
The study analyzes each company’s environmental claims against the CMA’s Green Claims Code (see previous post here for details) and UK consumer protection law. In particular, the CMA has yet to reach a conclusion on whether retailers are breaking the law.
In its review, CMA noted that the company’s fashion products, particularly “responsible editing“,”prepare for the future” When “George for Good”.
In deciding whether to take further action (such as criminal prosecution or demanding commitments), the CMA considers a variety of factors, including:
Whether the language used to advertise the product is misleading regarding eco-friendly certifications
Criteria used by companies to allocate products to sustainable lines and whether they are adhered to
Level of information about products provided to customers
Misleading statements and/or certification schemes
The CMA is now using its statutory powers to gather evidence, and has reportedly notified at least three companies expressing concerns in writing. The CMA’s interim chief executive warned these companies when they used misleading green claims:[the CMA] Do not hesitate to take enforcement action – through the courts if necessary”.
This is an important message for all companies, not just the fashion retail industry. It emphasizes that the CMA actively pursues greenwashing, and the CMA further emphasizes that:A broader overhaul of the fashion sector and potentially misleading environmental claims in other sectors will follow…“
US actionThe UK isn’t the only country where greenwashing is high on the agenda. In the U.S., various high-profile retailers are currently facing proposed class-action lawsuits related to environmental claims reportedly misleading as well regarding their eco-clothing lines.
Businesses should address these latest efforts to tackle greenwashing as a warning and strive to ensure the credibility of their sustainability claims to ensure continued consumer trust and confidence.
Danielle Jones also contributed to this article.
 [ 10 Jan 2022, “Compliance Review commences” (Misleading environmental claims – GOV.UK (www.gov.uk)) ]
© Copyright 2022 Squire Patton Boggs (US) LLPNational Law Review, Vol. XII, No. 227