On June 25, 2008 Canada's Competition Bureau (Bureau) released Environmental Claims: A guide for industry and advertisers (Environmental Claims Guide or Guide), its new environmental claims guidance document produced in partnership with the Canadian Standards Association (CSA).

The Environmental Claims Guide is meant to provide industry and advertisers with best-practices guidance for compliance with the prohibitions against false or misleading advertising in Canada's Competition Act, Consumer Packaging and Labelling Act and Textile Labelling Act, in addition to providing industry with a guide to the application of the CAN/CSA-ISO 14021, Environmental labels and declarations - Self-declared environmental claims (Type 11 environmental labelling) regulations.1

In the Environmental Claims Guide, the Bureau states that although businesses are free to adopt any practice concerning self-declared environmental claims, as long as those claims are not false or misleading, the Bureau will use the Guide as a reference for evaluating environmental claims. The Bureau further indicates that while the examples provided in the Guide are not binding statements of how its discretion will be exercised in any particular situation, environmental claims made in compliance with the Guide are unlikely to raise any concerns under the statutes administered by the Bureau.

Scope of Guidance

The Environmental Claims Guide is meant to cover any statement or symbol that refers to or creates the general impression that it reflects the environmental aspects of any product or service, including any statements, symbols or graphics on a product or package labels, or in product literature, technical bulletins, advertising, publicity, telemarketing and digital or electronic media. The Guide is organized largely around the 18 specific requirements of CAN/CSA-ISO 14021, which include, among others, that self-declared environmental claims: shall be accurate and not misleading or exaggerated; shall be substantiated and verified; shall be relevant to the product and used in
appropriate context; shall be specific; shall be made only if the environmental aspect to the claim exists or will be realized during the life of the product; and shall be presented in a manner that clearly indicates that any claim and explanatory statement(s) should be read together. For each of the 18 requirements, both an explanation and one or more examples are provided.

In addition, the Environmental Claims Guide explains the standards to be met and provides numerous examples regarding: vague or non-specific claims; claims of ". free"; sustainability claims; explanatory statements; symbols; evaluations and claim verification; comparative claims; and certain common claims (each of which receives detailed consideration) including "compostable", "designed for disassembly", "extended life product", "recovered energy", "recyclable", "recycled", "reduced resource use", "reusable and refillable" and "waste reduction".

Substantive Implications for Industry and Advertisers

The Environmental Claims Guide is intended by the Bureau to press industry and advertisers to observe higher standards and to increase the consistency of environmental claims in Canada. A few of the examples provided under the new guidance illustrate the point:

  • Claims of "... free" are to be made only where both (i) the material in question is present in no more than trace contaminant levels, and (ii) previously, such products had commonly featured the material in question in greater than trace contaminant levels;
  • Claims of sustainability are not to be made at all;
  • Claims without explanatory statements are to be made only if the claim is valid in all foreseeable circumstances without qualifications;
  • Claims must be verifiable, but will not be considered to be verifiable if verification cannot be made without access to confidential business information;
  • Claims qualifiers such as "... where facilities exist", in connection with, for example, recyclable or compostable claims, are not adequate; more detailed information about availability is required. For an unqualified claim, the claim should be verified to apply to a majority of the purchasers, potential purchasers and users of the product.

Although many businesses may comply or believe that they comply with many of the standards set out in the Environmental Claims Guide, a key change is the Bureau's clear intention to now require that businesses be able to provide the Bureau and consumers with substantiation and verification in connection with any environmental claim. Indeed, the Bureau identifies "the core principle . to be that businesses should only make claims that are substantiated and verified."

With the foregoing in mind, the Bureau has also indicated that it expects that companies may wish to reassess their advertising and labelling in light of the Environmental Claims Guide. It is allowing a one-year transition period for businesses to move into full compliance (excluding particularly egregious cases of false or misleading environmental advertising), following which Canadian advertisers can presumably expect a crack-down on unsubstantiated or unverified environmental claims.