In brief

The Competition and Consumer Commission of Singapore (CCCS) is developing a set of guidelines to provide greater clarity to suppliers on the environmental claims that could amount to unfair practices under the Consumer Protection (Fair Trading) Act (CPFTA), after a study found that one in two products sold online overstated their environmental claims.

---

Key takeaways

In view of greenwashing claims becoming more rampant in Singapore, the CCCS is beginning to scrutinise such claims more closely. Suppliers should be careful to ensure that their environmental claims do not constitute greenwashing in view of the potentially increased enforcement by regulators.

Misleading representations may be considered as unfair practices under the CPFTA or a breach of the Singapore Code of Advertising Practice (SCAP).

For breaches of the CPFTA, in addition to consumers being able to commence civil proceedings against the supplier for damages, the Consumers Association of Singapore (CASE) may also invite the errant supplier to enter into a voluntary compliance agreement, which would contain written undertakings that the supplier would not engage in the said unfair practices.

Sanctions for breaches of the SCAP include the withholding of advertising space or time from advertisers; adverse publicity arising from the Advertising Standards Authority of Singapore (ASAS) publishing details of the outcome of its investigations; and the ASAS may also refer the matter to CASE for recalcitrant advertisers that repeatedly ignore the SCAP.

In more detail

In a 2022 study commissioned by the CCCS to understand the extent of greenwashing on e-commerce websites in Singapore, it was found that one in two products sold online had overstated their environmental claims. This study examined over 1,000 products belonging to 10 categories on 100 of the e-commerce sites most visited by Singapore residents.

CCCS’ reference to greenwashing refers to a supplier’s conduct that deceives or misleads consumers into believing that the supplier’s practices, goods or services are more environmentally positive or have greater environmental benefits than is the case.

Types of greenwashing claims that were considered include the following:

1. Unsubstantiated claims: Insufficient elaboration or credible evidence to support the eco-friendly claims of products (e.g., statements claiming that products are made of recycled materials, without providing information on the origins of the recycled content or details of the components).
2. Technical jargon: Use of complex and technical terms that confuses or misleads consumers as to a product’s environmental impact (e.g., inaccurately labelling petroleum-based plastics ABS (acrylonitrile butadiene styrene) as environmentally  friendly when they are not).
3. Unnecessary disclosures: Featuring environmental claims that are unnecessary as those claims reference practices that are mandated by law (e.g., presenting the lack of mercury in LED lamps as an eco-friendly benefit when all similar products would have such a feature as all lamps should not contain mercury).
4. Unverified eco-labels: Advertisement of products certified to be eco-friendly without specifying the certification.

Findings revealed that unsubstantiated claims made up the most common form of greenwashing (51%) of sampled products, followed by the use of technical jargon (14%).

To address these and other potential greenwashing conduct by suppliers, the CCCS is developing a set of guidelines to provide greater clarity to suppliers on the environmental claims that could amount to unfair practices under the CPFTA. The CCCS will be seeking views from the public in due course.

In the meantime, the CCCS has advised that suppliers:

1. Make specific environmental claims and provide credible evidence alongside these claims;
2. Use language that is easily understood by consumers and explain the meaning or implications of technical terms; and
3. Avoid making claims that are prone to conveying the impression that the product is more eco-friendly than it is (e.g., marketing an “environmentally friendly” product in a manner that implies that the product is made of 100% recycled material when it is in fact only made of 10% recycled material).

The CCCS has also, together with CASE, developed a set of tips to help consumers better understand environmental claims. The set of tips may be accessed here.

The CCCS has advised consumers who encounter potentially false or misleading environmental claims to approach CASE for assistance and highlighted that misleading environmental claims in breach of the SCAP may be reported to the ASAS.

* * * * *

© 2023 Baker & McKenzie.Wong & Leow. All rights reserved. Baker & McKenzie.Wong & Leow is incorporated with limited liability and is a member firm of Baker & McKenzie International, a global law firm with member law firms around the world. In accordance with the common terminology used in professional service organizations, reference to a “principal” means a person who is a partner, or equivalent, in such a law firm. Similarly, reference to an “office” means an office of any such law firm. This may qualify as “Attorney Advertising” requiring notice in some jurisdictions. Prior results do not guarantee a similar outcome.