EU parliament backs tighter rules to tackle greenwashing


(Photo: iStock)

The European Parliament passed several green bills during the meeting on Mar. 12, including imposing severe penalties to company for greenwashing behavior and requiring member states to promote building renovations to improve energy efficiency and reduce carbon emissions.

The European Commission proposed the "Directive on Green Claims" in 2023, which, after discussions and amendments in the European Parliament, passed with a significant majority of 467 votes in favor and 65 against. In the future, companies must apply for approval and undergo evaluation within 30 days to use "green marketing." Violations of the regulations will result in exclusion from public procurement tenders and fines of at least 4% of annual revenue.

The draftsman of the bill, Estonian MEP Andrus Ansip and Maltese MEP Cyrus Engerer, cited data indicating that over 50% of environmental claims for products are vague, misleading, and unfounded. Furthermore, companies will be prohibited from claiming their products as green solely through carbon offsetting. Only certified and credible carbon credits for residual emissions, after exhausting carbon reduction methods, can be mentioned in advertisements.

According to the contents of the bill, small and medium-sized enterprises will have a one-year grace period before the new law takes effect, while micro-enterprises will not be subject to regulation.

Regarding building renovations, the European Parliament passed amendments to the "Energy Performance of Buildings Directive." By 2030, all new residential buildings must achieve zero carbon emissions, with the target for public buildings moved up to 2028 and overall buildings to reach climate neutrality by 2050.

Among existing non-residential buildings, 16% of the-least-energy-efficient must undergo renovation by 2030 and increasing to 26% three years later. However, historic monuments and farmhouses are exempt, and member states can decide on special buildings to protect.

Other provisions include the discontinuation of subsidies for fossil fuel heaters starting in 2025, with a gradual phase-out by 2040, and a requirement for newly constructed or renovated buildings to install rooftop solar panels.

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