The Netherlands Authority for Consumers and Market (ACM) has recently announced that it will further investigate six companies in the clothing sector because of possible misleading practices concerning sustainability claims.
In May 2021, the ACM contacted over 170 businesses in three different sectors of the economy – energy, dairy products, and clothing – and urged them to critically evaluate whether their sustainability claims were accurate, clear, and sufficiently substantiated. The Dutch regulator subsequently launched market investigations in those sectors, and the results of the investigation into sustainability claims made by ten major clothing companies are the first to be made public, although on a no-name basis.
In particular, the ACM investigated whether the clothing companies provided customers with correct information regarding (i) the sustainability benefit of their products, (ii) the percentage of organic cotton that a piece of clothing contains, and (iii) sustainable collections. Based on its preliminary findings, the ACM will now further investigate two Dutch and four non-Dutch clothing companies to assess whether potentially misleading claims are truly misleading. The ACM announces that if it concludes that the sustainability claims are misleading, it may fine the Dutch companies and ask the national regulators of the non-Dutch companies to do the same (as the ACM is only competent to impose sanctions on the Dutch companies on the basis of Dutch consumer protection law).
The announcement is in line with the ACM’s enhanced focus on the energy transition and misleading sustainability claims. Since 2020, the ACM has devoted extra attention to sustainability claims made by businesses, and in the beginning of this year, the Dutch regulator has published guidelines for companies that wish to make claims regarding the sustainability of their products or services. See also our separate blog on these Guidelines and our recent ‘Green advertising through the EU lens’-webinar. For more on ACM’s focus on sustainability, see also our most recent webinar on this topic.
The authors would like to thank Fabian de Vries for his support in writing this blog.