Greenwashing Penalties by Country in 2026: EU, UK, US, France & Beyond

Global penalty comparison at a glance

The table below summarises maximum penalty thresholds for greenwashing by jurisdiction as of October 2026. Most of these are upper limits — actual penalties depend on violation severity, company size, and whether infringement was deliberate.

EU: ECGT penalties and the 4% rule

The Empowering Consumers for the Green Transition Directive (Directive 2024/825) — better known as the ECGT — entered into force on 26 March 2024. Member states had to adopt their national measures by 27 March 2026, and the new rules have applied since 27 September 2026.

The ECGT does not set its own fines. It amends the Unfair Commercial Practices Directive, and breaches are sanctioned under each member state's UCPD penalties, which must be "effective, proportionate and dissuasive" (Article 13 UCPD). The 4% figure applies to one situation: in coordinated cross-border actions under Article 21 of Regulation (EU) 2017/2394, national law must allow a maximum fine of at least 4% of the trader's annual turnover in the member states concerned, or at least €2 million where turnover data is unavailable. It is a floor on the maximum, not a standard fine. Beyond fines, the tools are:

• Orders to stop an unfair practice, or to prohibit it before it runs
• Where national law provides it, publication of the decision and a corrective statement
• Consumer remedies: compensation, a price reduction or termination of the contract

Confiscation of revenues and exclusion from public procurement for up to 12 months are often quoted as ECGT sanctions. They are not: both came from the Commission's 2023 Green Claims Directive proposal, which the Commission announced its intention to withdraw in June 2025.

On substance, the ECGT bans generic environmental claims such as "eco-friendly" unless the trader can demonstrate recognised excellent environmental performance relevant to the claim, bans claims that a product has a neutral, reduced or positive climate impact based on greenhouse-gas offsetting, and bans sustainability labels that are neither based on a certification scheme nor established by public authorities. For a full list of banned terms, see our EU banned green terms guide.

Claims still online on or after 27 September 2026 are judged against these bans as transposed in each member state, so the national penalty regime is what decides the bill. For a deeper analysis of how ECGT fines are calculated, see our dedicated article on ECGT penalties and EU green claims fines.

UK: CMA's new 10% global turnover power

The UK left the EU but created its own aggressive anti-greenwashing regime. The Digital Markets, Competition and Consumers Act 2024 (DMCCA) came into force on April 6, 2025, transforming the Competition and Markets Authority (CMA) from a watchdog that needed court orders into one that can act directly.

Since April 2025, the CMA can:

• Investigate greenwashing claims without court involvement
• Issue binding enforcement orders requiring corrective action
• Fine businesses up to 10% of their global turnover, or up to £300,000 where that is higher (relevant for traders with little or no turnover)

The UK Advertising Standards Authority (ASA) operates in parallel, banning non-compliant advertisements and naming companies publicly. The ASA banned Ryanair's "lowest carbon airline" claim in 2020 and HSBC's climate commitment advertisements in 2022. Both rulings still frame how UK claims are read.

The CMA set out how it applies consumer law to environmental claims in its Green Claims Code (2021), and that code is the yardstick it now enforces with direct fines. Financial services firms also fall under the FCA's anti-greenwashing rule, in force since 31 May 2024: any reference to the sustainability characteristics of a product or service must be consistent with those characteristics and fair, clear and not misleading.

France: criminal liability and the Shein case

France treats misleading commercial practices as a criminal offence. Article L132-2 of the Consumer Code sets the penalties, and the 2021 Climate and Resilience Law added a higher ceiling for environmental claims:

1. Base penalty: two years' imprisonment and a €300,000 fine
2. Raised fine: in proportion to the benefit drawn from the offence, up to 10% of average annual turnover (last three known years) or 50% of the spend on the advertising or practice
3. Environmental claims: that 50% rate rises to 80% when the misleading practice rests on an environmental claim

The DGCCRF investigates and refers cases; criminal penalties are imposed by the courts. Its highest-profile recent action: Shein was fined €40 million in July 2025 for misleading commercial practices, chiefly fake discounts but also overstated environmental commitments.

France's approach is notable for its willingness to pursue criminal charges — not just administrative penalties. Because the offence is criminal, the individuals responsible can be prosecuted as well as the company. For companies in the fashion sector specifically, see our guide on fashion industry greenwashing claims and EU rules.

Netherlands: the ACM's aggressive enforcement model

The Dutch Authority for Consumers and Markets (ACM) can impose administrative fines of up to €900,000 for unfair commercial practices without going to court. In its best-known sustainability cases, though, it accepted binding commitments instead: the company changed or dropped its claims and paid a donation to a sustainability cause.

• H&M: commitment to adjust or drop sustainability claims, plus a €500,000 donation (ACM, 2022)
• Decathlon: same type of commitment, €400,000 donation (ACM, 2022)
• Vattenfall and Greenchoice: €950,000 and €450,000 donations for unclear and insufficiently substantiated energy sustainability claims (ACM, 2022)
• KLM: Amsterdam District Court ruled KLM's "sustainable flying" claims were misleading and unlawful (2024)

The ECGT bans reach Dutch businesses through this same consumer-law framework, so the ACM's fining powers apply to them.

Germany: private enforcement and Verbraucherschutz

Germany's enforcement model differs structurally from most EU countries. Rather than relying primarily on a central regulatory authority, Germany uses a system of private enforcement through Verbraucherzentralen (consumer protection organisations) and industry associations (Wettbewerbszentrale), which can file injunctions against misleading green claims in commercial courts.

The courts set a high bar. In its "klimaneutral" judgment of 27 June 2024 (I ZR 98/23), the Federal Court of Justice held that an ambiguous environmental term such as "climate neutral" is misleading unless the advertisement itself explains what it means. A QR code or a website link elsewhere is not enough, and reduction and offsetting may not be presented as equivalent. That ruling applies the Gesetz gegen den unlauteren Wettbewerb (UWG).

The UWG is the German law that implements the UCPD, so the ECGT bans are enforced through the same route: warning letters and injunctions brought by competitors and qualified associations, backed by the courts.

United States: FTC fines and the Green Guides

The US Federal Trade Commission (FTC) enforces environmental marketing claims under Section 5 of the FTC Act (prohibition on unfair or deceptive practices) and its Green Guides, last formally updated in 2012. The FTC generally cannot fine a company for a first violation of Section 5. Civil penalties come in when a company breaches an existing FTC order, or knowingly engages in conduct the Commission has already declared deceptive (its "penalty offense" authority). The per-violation amount is adjusted for inflation: $53,088 after the January 2025 adjustment.

Notable outcomes with specific dollar amounts:

• Walmart and Kohl's: $3 million and $2.5 million in civil penalties sought by the FTC in 2022 for marketing rayon textiles as bamboo and touting them as eco-friendly. The FTC called them "by far the largest penalties in this area" (FTC)
• Keurig Dr Pepper: $1.5 million SEC civil penalty (September 2024) for annual-report statements that its K-Cup pods could be recycled, omitting doubts raised by two large recyclers

The FTC opened a review of the Green Guides in December 2022, with carbon offsets and recyclability among the open questions. Check the FTC's Green Guides page for their current status. State attorneys general can also act under state consumer protection laws, independently of the Guides.

The SEC acts separately on sustainability statements made to investors, as the Keurig case shows. For companies in the financial sector, see our guide on ESG fund greenwashing and finance sector risks.

Australia: ACCC and ASIC joint enforcement

Australia has emerged as an unexpected frontrunner in greenwashing enforcement. The Australian Competition and Consumer Commission (ACCC) and the Australian Securities and Investments Commission (ASIC) operate coordinated enforcement campaigns.

For a company that makes false or misleading representations, the maximum penalty under the Australian Consumer Law is the greatest of:

• AUD 50 million
• 3 times the value of the benefit obtained
• If that benefit cannot be determined, 30% of adjusted turnover during the breach period

In June 2025, the ACCC started Federal Court proceedings against Australian Gas Networks over its "Love Gas" campaign (2022 and 2023). The ACCC alleges the ads promised renewable gas to households "within a generation" without any qualification, even though it was highly uncertain whether that could be achieved. AGN is defending the case. On the financial side, ASIC has already won court penalties for greenwashing: AUD 11.3 million against Mercer and AUD 12.9 million against Vanguard (both 2024), for sustainable-investment claims their funds did not live up to.

What actually triggers a greenwashing investigation

Published decisions keep returning to the same few patterns. Knowing them tells you what to fix first.

The highest-risk behaviours are:

1. Carbon neutral or climate neutral claims based on offsets: Product claims of neutral, reduced or positive climate impact based on offsetting are banned outright under the ECGT, were central to the KLM ruling in the Netherlands, and need an in-ad explanation in Germany under the BGH "klimaneutral" judgment. See our dedicated analysis of carbon neutral claim bans in the EU.
2. Generic "eco" or "green" terms without substantiation: The ECGT explicitly bans generic environmental claims. Regulators in Germany, the Netherlands, and the UK have all issued findings against companies using "eco-friendly", "sustainable", "responsible", or "green" without specific supporting evidence.
3. Comparative claims without methodology disclosure: The Ryanair case established this clearly: even a technically accurate comparative claim becomes misleading if consumers cannot understand the basis for the comparison.
4. Omission of material negative information: The HSBC case in the UK defined this category. Highlighting positive environmental initiatives while omitting a company's overall carbon footprint or continued fossil fuel investment constitutes a misleading omission.
5. Sustainability labels not based on a certification scheme: since 27 September 2026, the ECGT bans displaying a sustainability label that is neither based on a certification scheme nor established by public authorities. Self-made eco-badges are the obvious target.

For a technical analysis of how automated tools detect these patterns in website copy, see our guide on how to detect greenwashing.

How to protect your business now

The ECGT bans have applied since 27 September 2026, the UK DMCCA regime since April 2025, and France, the Netherlands and Australia were already enforcing before either. Fixing a claim before a regulator or a competitor raises it costs far less than defending it, and in the EU, prompt remediation is one of the factors authorities weigh when setting a penalty.

The essential steps are:

1. Audit all environmental claims across all channels: website copy, product packaging, social media, press releases, and annual reports. Cross-channel inconsistency is itself a red flag.
2. Document substantiation for every surviving claim: lifecycle assessment reports, third-party certification certificates, specific data sources. If you cannot produce the evidence immediately, withdraw the claim immediately.
3. Remove or rephrase generic terms: replace "eco-friendly" with specific, quantified statements. Replace "sustainable" with what is actually being measured and certified.
4. Eliminate offset-based neutrality claims: reframe around verified reduction milestones rather than neutrality achieved through offsetting.
5. Implement approval governance: every new environmental claim must pass through a legal or compliance review before publication.

The fastest way to identify which claims on your website are highest-risk is to scan your website with our free Green Claims Scanner. The tool flags ECGT-prohibited terms, unsubstantiated comparatives, and carbon neutral claim patterns — giving you a prioritised list of what to fix first. For the full ECGT compliance process, see our ECGT compliance guide.