CO₂ Compensation in Advertising: Why "climate neutral" Becomes Risky from 27 Sept 2026

CO₂ Compensation in Advertising: Why "climate neutral" Becomes Risky from 27 Sept 2026

Teaser: "Climate-neutral product through CO₂ certificates", this advertising was standard for years. From 27 September 2026, in our reading it is generally impermissible. Annex No. 4c of the blacklist prohibits product-related compensation claims without exception. We explain what is likely still permissible, which exception applies for genuine reduction, and how to build evidence for your claims.

The Problem: "Climate-neutral Water Through Reforestation"

Imagine: a mineral water producer advertises its bottles with the imprint "climate neutral, with the support of [Climate Project X]". Production and transport emissions are offset through certificates from a reforestation project.

This practice was well established for years. From 27 September 2026, in our reading it could be a clear violation of Annex No. 4c of the blacklist. Recital 12 of the EmpCo Directive names exactly this case as a reference example.

What Annex No. 4c Prohibits

The provision reads (simplified): a claim based on the compensation of greenhouse gas emissions, according to which a product has neutral, reduced or positive effects on the environment in terms of greenhouse gas emissions.

Four elements are central:

1. Claim about compensation (offsetting): The claim is based on emissions not being reduced at source but being offset elsewhere, typically through the purchase of certificates (Gold Standard, Verra/VCS) or investments in climate projects.

2. Product reference: The provision exclusively captures product-related claims. "This yoghurt is climate neutral" falls under No. 4c, "We offset our corporate emissions" in our reading does not (here the general misleading under § 5 UWG applies).

3. Neutral, reduced or positive effect: The wording captures three variants:

  • Neutral: "climate neutral", "CO₂-neutral", "net-zero product"
  • Reduced: "climate-friendly through CO₂ offsetting"
  • Positive: "climate positive", "CO₂-negative thanks to certificates"

4. Causal link: The claim must be based on compensation. If the compensation were removed, the claim would also fall away.

The Central Distinction: Product vs. Company

The legislator explicitly clarified this distinction in the government draft (BT-Drs. 21/1855, p. 86), and it is one of the most important practical distinctions.

ClaimPossible provision
"This product is climate neutral through compensation"Annex No. 4c (prohibited)
"We offset our corporate emissions"§ 5 UWG (case-by-case examination)
"Climate neutral by 2030 through reduction plan X"§ 5 (3) No. 4 UWG (forward-looking claim)

Important: company-related claims are not automatically permissible. Anyone who says "We are climate neutral through compensation" must, in our reading, disclose transparently how much is offset and what residual emissions remain. Otherwise a warning letter under § 5 UWG may follow.

Three Practical Cases

Case 1: Mineral Water "Climate Neutral Through Reforestation"

Claim: Bottle label with "climate neutral, with the support of Climate Project X". Emissions are offset through reforestation certificates.

In our reading: Classic violation of Annex No. 4c. Product-related claim that is entirely based on compensation. No genuine reduction in the value chain.

Case 2: Furniture "80 % Genuine Reduction + 20 % Compensation"

Claim: "Climate-neutral production", plant converted to renewable energies, material efficiency increased. 80 % genuine reduction, remaining 20 % offset through Gold Standard certificates, transparently disclosed.

In our reading: Could be permissible. Recital 12 sentence 2 allows mixed constellations where the genuine reduction is sufficient and the compensation is communicated transparently as ancillary. Practice will need to pay close attention to the weighting here.

Case 3: "Climate Neutral" Without Compensation (Genuine Life-Cycle Neutrality)

Claim: A product is advertised as "climate neutral" because the entire life cycle, production, use, disposal, is emission-neutral without compensation.

In our reading: Permissible, but extremely rare in practice. Most products have unavoidable residual emissions (agriculture, logistics, disposal). Recital 12 requires a full life cycle assessment according to a recognised method (ISO 14067, GHG Protocol Product Standard).

How to Build Evidence for Permissible Claims

If you switch from compensation to genuine reduction, you need solid evidence for every claim. A life cycle assessment to ISO 14067 or GHG Protocol Product Standard is the basis, but certificates, test reports and studies must also be stored centrally and in an audit-proof manner.

This is exactly where the Evidence Register of GreenClaims Manager comes in. It is used for the central management of all evidence supporting your environmental claims, certificates, test reports, life cycle assessments, internal studies. Each evidence entry can be linked to one or more managed claims, so the relationship between claim and proof always remains traceable.

Evidence Register in GreenClaims Manager with central evidence management
Evidence Register: manage certificates, test reports and life cycle assessments centrally and link them to claims.

This is particularly relevant for Annex No. 4c: anyone wishing to rely on the exception of genuine reduction must, in case of doubt, demonstrate how much has actually been reduced, and that requires solid evidence documentation.

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FAQ

Is "climate neutral" banned from 27.09.2026?

"Climate neutral" is not generally banned. What is banned, in our reading, is only the product-related claim based on CO₂ compensation. Anyone who relies on genuine life-cycle neutrality should be able to continue using the claim, but must be able to produce a full life cycle assessment.

What is the difference between Annex 4c and § 5 UWG?

Annex No. 4c exclusively captures product-related compensation claims and prohibits them per se. § 5 UWG captures company-related claims ("We offset our emissions") on a case-by-case basis, these are not automatically banned, but misleading if the conditions are missing.

Can I still say "climate positive"?

"Climate positive", like "climate neutral", is in our reading risky from 27.09.2026 if it is based on compensation. Annex No. 4c explicitly captures all three variants: neutral, reduced and positive effects.

Do these rules also apply to B2B advertising?

Annex No. 4c applies to commercial practices towards consumers (B2C). In B2B advertising, in our understanding the general misleading under § 5 (1) UWG applies, but the strict EmpCo provisions should be limited to B2C.

What does a violation of Annex No. 4c cost?

Like all blacklist violations: up to 4 % of EU annual turnover under § 59 UWG (new version).

Note: All content on this website is provided for general informational purposes only and does not constitute legal advice. For a binding assessment of your individual situation, please consult a specialist lawyer for competition law. Despite careful review, we cannot guarantee the accuracy, completeness or currentness of the information provided.

*Sources: UWG amendment, Federal Law Gazette 2026 I No. 43, Annex No. 4c | BT-Drs. 21/1855, pp. 85–87 | Directive (EU) 2024/825 (EmpCo), recital 12. As of: July 2026.*

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