What's the problem?
The Advertising Standards Authority (ASA) has recently published a series of rulings against advertisers using the terms 'compostable' and 'biodegradable' to describe their products.
In upholding rulings against Lavazza and Dualit, the ASA noted that consumers would likely interpret the terms 'compostable capsules' and 'compostable coffee bags' in home-use ads to mean the products could be composted at home. However, the products were only certified for industrial composting. The ads failed to clarify this and did not provide proper disposal instructions. The ASA deemed this omission of information significant, leading to the complaints being upheld.
A few weeks earlier, the ASA upheld a complaint regarding ‘biodegradable’ laundry pods due to insufficient substantiation. Despite the advertiser providing various scientific and anecdotal evidence, none demonstrated that the laundry pods in question were fully biodegradable during normal use in a washing machine. The complaint, along with three others concerning additional green claims in the ad, was upheld.
Whilst these are the most recent, they are not the first instances of the ASA scrutinising green terminology. The ASA previously upheld a complaint against 'biodegradable' dog waste bags that would not in fact biodegrade if starved of oxygen. The ASA considered the most likely destination of bags left in waste bins would be incineration or landfill, where they would therefore not biodegrade. The ASA also upheld a complaint against 'biodegradable' baby wipes because, despite being advertised as suitable for home composting, the evidence provided failed to account for all ingredients or the contamination with organic matter which made them unsuitable for composting.
What's the risk?
Greater than ever before. The ASA has long been at the forefront of UK ad scrutiny, and Trading Standards for most other claims, but the Digital Markets, Competition and Consumers (DMCC) Act 2024, changed that. The Act recast the legal underpinning of ad scrutiny previously contained in the Consumer Protection from Unfair Trading Regulations (CPRs), and significantly from April 2025 bestowed significant new enforcement powers on the Competition and Markets Authority (CMA).
While the ASA's powers are mainly limited to causing reputational damage through published rulings, and Trading Standards can, but seldom do, prosecute through the Courts, the DMCC Act allows the CMA to conduct its own investigations and impose civil sanctions of fines of up to 10% of global turnover without recourse to the courts.
In short, the risk profile has transformed. The CMA can launch a public investigation if it reasonably suspects a breach and control the timeline to reach a swift resolution. The DMCC Act's enforcement framework actively incentivises businesses to cooperate and settle early, reducing the risk of a final enforcement notice with a hefty price tag.
The CMA may also accept undertakings from non-compliant businesses, which may seem a more palatable alternative to monetary penalties, but can be invasive and burdensome, as seen in the CMA's 2022 investigation into greenwashing by fashion retailers ASOS, Boohoo and Asda.
So why do ASA rulings still matter? The CMA will look to the ASA for inspiration to ensure a consistent approach in ad scrutiny, making ASA rulings valuable indicators of how the CMA may tackle similar issues.
What's the lesson?
Exercise caution when using green terminology to describe your products. Manage risk by considering the following:
- Consider how the average consumer would interpret the claim in the context of the whole ad.
- Make clear any important information or limitations that impact the product's ability to be disposed of as claimed (e.g. household versus industrial composting).
- Do not exaggerate.
- Support claims with evidence that is directly applicable to the product, including its composition, how it will be used, and how it will be disposed of. Consideration of real world conditions is key.
- Ensure, wherever possible, you – not a third party - hold the evidence to substantiate your claims so that you can share it with the regulator within the requested timeframe. And when working with third parties to produce evidence or studies ensure that the contracts include provisions mandating that they will provide you with the necessary information.
- If the CMA initiates an investigation, promptly involve your PR and Communications teams to manage the public fallout effectively.
- Contact us. We can advise on the risk attached to proposed claims, and have years of experience in navigating both CMA and ASA investigations.
What else?
The risks from the CMA's new powers extend far beyond just using green terminology. Any claim or commercial practice is within scope. So, while this article is focuses on the ever popular green claims, do not assume that this is the only area covered. Any claim that lacks sufficient evidence in whatever context will be in scope. It is crucial to adjust attitudes to risk of claims and copy to account for this change.
What next?
Do not be discouraged. While the new enforcement landscape may seem daunting, advertisers with genuine environmental credentials should not be 'greenhushed'. The effort put into making products more sustainable is significant, and it is important to continue setting a positive example.
To build trust and reassure businesses, the CMA has emphasised that its enforcement approach will be proportionate and predictable. It plans to publish clear guidance, establish precedents, and offer businesses the chance to seek advice in an informal setting. How this will work in practice remains to be seen.
In the meantime, consider all green claims, including those using green terminology, high risk until the CMA suggests otherwise. Rigorously assess all green claims, both new and existing, review your due diligence systems, and ensure approval processes can catch any issues before it is too late.
Questions?
If you have any questions on the above and how it may impact your business, please contact Dominic Watkins or Abigail Reay.
