Europe to penalise car companies for ‘green-washing’ – report

The European Union is proposing new laws that would make it illegal – and expensive – for car-makers who make false claims about the environmental credentials of their vehicles.

Car companies in Europe could soon face harsh penalties if they downplay the environmental harm – or exaggerate the benefits – of the technology in their vehicles.

A leaked proposal obtained by news website Euractiv has revealed the European Union wants to discourage car-makers from a practice known as ‘greenwashing’ – the name for a marketing exercise designed to exaggerate the environmental credentials of a product.

In the draft, the European Commission – the politically-independent executive arm of the European Union – alleges approximately 40 per cent of environmental claims made about products are unsubstantiated.

“Consumers lack reliable information about the sustainability of products and face misleading commercial practices like greenwashing or the lack of transparency and credibility of environmental labels,” the proposal reads.

“Companies making ‘green claims’ should substantiate these against a standard methodology to assess their impact on the environment.”

It recommends implementing “dissuasive” penalties on companies making the false environmental claims.

The European Union has also been looking at ways to standardise the methodologies used to measure the impact of products on the environment.

MORE: Europe officially passes 2035 ban on new petrol and diesel cars

The proposed laws come almost a decade after the Volkswagen Group was found to have been marketing some of its diesel-powered vehicles as being friendly to the environment, when they had been fitted with software designed to cheat official emissions testing conducted by authorities.

Known as ‘Dieselgate’, it’s estimated the scandal cost the Volkswagen Group more than $US33.3 billion ($AU48.4 billion) in fines, compensation, and vehicle buybacks, according to Reuters.

In 2008, the Australian Competition Consumer Commission found General Motors Holden guilty of breaching the Trade Practices Act by falsely advertising its range of vehicles from Saab as being carbon neutral.

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