UK drinks brands face fines for greenwashing
Drinks producers in the UK could be penalised for making misleading sustainability claims after the Competition and Markets Authority (CMA) was given additional enforcement powers.
The UK government has strengthened the Digital Markets, Competition and Consumers Act 2024 (DMCCA) to protect consumers from false claims and ensure businesses operate on a level playing field. The enhanced DMCCA came into force on 7 April 2025.
The CMA is now able to decide if consumer protection laws have been infringed without the need for court intervention and can penalise UK companies directly.
The new DMCCA empowers the CMA to fine companies up to £300,000 (US$382,799) or 10% of their global revenue for making false green claims, such as ‘plastic free’ or ‘carbon neutral’.
The CMA’s Green Claims Code outlines six principles that brands must follow to ensure they comply with consumer protection law.
The six core principles are: claims must be truthful and accurate, clear and unambiguous, not omit important information, make fair and meaningful comparisons, consider the full product life cycle, and be substantiated.
Avallen Solutions, a sustainability consultancy company for the drinks sector, has published a guide to the DMCCA and how the UK drinks industry can navigate the changes.
The guide notes that the legislative development “significantly strengthens the regulatory environment” when it comes to making claims about sustainability.
Tim Etherington-Judge, founder of Avallen Solutions, said the enhanced act means that brands “that are engaging in greenwashing, or not being super transparent with their claims, are at risk” and could be penalised if they can’t provide proof.
“There’s some brands that are making big [green] claims without the evidence,” Etherington-Judge notes. “They’re claiming to be much better than they are.”
He hopes that the act will also prevent brands from claiming that they are sustainable by only making their bottles lighter. “You’ve got to think about the whole lifecycle of your product,” he adds.
Fear of ‘green hushing’
However, Etherington-Judge fears that the new act could also see companies “green hushing” if the CMA “goes after the good guys”.
The term ‘green hushing’ refers to when companies downplay or don’t disclose their sustainability efforts in fear of being accused of greenwashing.
Etherington-Judge warns that competitors could “weaponise” the new act and report brands to the CMA even if they are technically a “good company”.
He notes one recent example of “weaponising”, where 10 leading car manufacturers were fined more than £77 million (US$98.2m) by the CMA after they colluded that they would not advertise what percentage of their cars can be recycled at the end of the car’s life.
The CMA was tipped off by fellow car maker Mercedez-Benz, which avoided the fine despite being involved in the scheme.
“I’m not saying that’s going to happen in the drinks industry,” Etherington-Judge adds, but the act could put brands with good intentions at risk.
Avallen Solutions has been working with brands to ensure they are compliant with the regulations.
If a brand is making an unfounded green claim in their marketing or on their labels, they would also be forced to change it, Etherington-Judge notes. “It’s fine to make the claims on your bottle, if you put the information on the website and the information is clear and available.”
Avallen shifts away from ‘planet-positive’ claim
Calvados brand Avallen, which was founded by Etherington-Judge and Stephanie Jordan-Balmforth in 2019, will also stop using the term ‘planet positive’.
“It’s a very vague term,” Etherington-Judge said of the decision to axe the phrase. “There’s no certification, it doesn’t mean much. So we’re going to remove that from the bottle and the website.
“We’re going to change a few other things. We set out to be as sustainable as possible, so we have to be compliant as possible.”
On Avallen’s website, visitors can access information to back its sustainability claims. The brand’s B Corp score can be viewed online and every year Avallen publishes a report that measures its impact on the planet.
In the EU, there is also new legislation coming in regarding environmental claims, Etherington-Judge highlights.
He mentions two acts: the Empowering Consumers for the Green Transition Directive (ECGTD) and the Green Claims Directive (GCD). These are designed to work together to combat misleading environmental marketing and play a similar role to the CMA’s Green Claims Code and the updated DMCCA, Etherington-Judge explained.
As the new act comes into force in the UK, Etherington-Judge believes it’s a “good time for brands to really review their sustainability credentials”.
He continues: “With this new legislation, [companies] shouldn’t be fearful. The CMA are not going to come after them immediately. It’s a good time to look at what they’re claiming, dig out the evidence, or if you don’t have the evidence, to go and get it for the claims they’ve made.”
Related news
Neurita gains UK on-trade listings
