To protect consumers from unfair commercial practices, the DMCCA aims to tackle the various forms of greenwashing, including misleading actions and omissions (such as advertising and reviews), aggressive practices and the contravention of requirements of professional diligence, with an additional and specific focus on targeting vulnerable persons, unfair contractual terms, “fake reviews” and “drip pricing”. The fake reviews guidance was issued on April 4, with a three-month grace period to promote compliance before enforcement starts. A draft of the guidance on drip pricing is expected in mid-2025.

The CMA plans to take a phased approach to enforcement, tackling the “most egregious” breaches first. These breaches will include, among others, aggressive sales practices that prey on vulnerability, providing objectively false information to consumers and practices that are unfair by law.

In the fashion sector, since 2022, the CMA has been actively investigating and amending its approach along the supply chain (including manufacturers, suppliers, wholesalers and distributors) focusing on consumer protection against misleading information. In September 2024, the CMA issued a guidance titled “Complying with consumer law when making environmental claims in the fashion retail sector.” It addresses sustainable product lines, use of imagery, product filters, environmental targets and accreditation schemes, and covers environmental claims related to the business as a whole, as well as products, services, processes and brands.

To supplement the broader scope of its new enforcement powers, the CMA has published an accompanying guidance on its approach to consumer protection (Unfair commercial practices guidance CMA207) and protection from unfair trading provisions, which is a procedural guidance explaining how the DMCCA will be enforced (Direct consumer enforcement guidance CMA200). It has also issued Consumer protection: enforcement guidance CMA58, which details the CMA’s consumer investigatory and enforcement powers.

CMA’s new and improved enforcement powers

The DMCCA provides the CMA with the power to investigate potential breaches of consumer protection law and requires companies to comply with its directions. This may include giving undertakings to the CMA to refrain from making statements that may constitute an infringement, and removal of misleading statements from publicly published content, including ad bans.

Importantly, the DMCCA grants the CMA the power to issue fines of a fixed amount not exceeding 10% of group annual turnover of a noncompliant company. Additionally, the CMA has been granted “enhanced consumer measures.” These take a number of forms, namely:

• “redress measures,” which offer compensation to affected consumers;
• “compliance measures” to prevent or reduce the risk of occurrence or repetition of the infringing conduct; and
• “choice measures” to enable consumers to choose more effectively between suppliers of goods, services or digital content.

Noncompliance can therefore result in significant financial, operational and reputational impacts.

Impact on green claims laws in the UK and EU

The new enforcement powers created under the DMCCA enable the CMA to better enforce the Green Claims Code (GCC). The GCC stands separately from the DMCCA and is a principles-based code that outlines the descriptors necessary to maintain transparency and avoid greenwashing.

Addressing misleading green claims has been a key part of the CMA’s annual plans since 2020, and in the Conservative government’s Strategic Steer to the CMA, published in 2023, protecting consumers from “misleading environmental claims” was identified as a key objective. With this focus, the CMA has stated that greenwashing is likely to be one of its main enforcement priorities.

With the new regime, the CMA will have the authority to bring enforcement actions against noncompliant companies that have made unsubstantiated green claims, presented their sustainability data in a misleading way, or overstated their commitments to sustainable business.

An important influence on the GCC has been the EU Green Claims Directive, which is expected to come into force in 2027 and will introduce new rules for compliance of businesses making green claims in the EU. Although it does not directly apply in the UK post-Brexit, its principles and approach to consumer protection have been a factor in the evolution of the GCC. The UK and EU laws are aligned in their aims of preventing greenwashing and ensuring that environmental claims are accurate and substantiated, empowering consumers with reliable information. Businesses operating in both the UK and EU will have to pay close attention to the requirements of these regulatory frameworks and where they differ, and what compliance entails.

Looking ahead and expected timelines

The green claims regime in the UK (and in the EU) is still evolving. Looking ahead, actions and outputs can be expected for the UK (through the CMA and under the Green Claims Code) and in the EU (including under the Green Claims Directive, as well as eco-design and labeling requirements under the EU Green Deal).

• Between April and July 2025: work through a program of engagement with businesses and consumer organisations.
• Over the next few months:

i) work with key stakeholders to understand what advice would be most valuable for removing barriers to growth;

ii) set out how businesses can provide evidence to the CMA of unfair advantages gained by noncompliant businesses;

iii) where there is no precedent and there is regulatory uncertainty, explore new opportunities for businesses to seek advice for conduct they are considering introducing;

iv) apply a framework for compliance and enforcement of the new consumer protection regime focused on “4Ps”: pace, predictability, proportionality and process; and

v) open the first cases under the new regime.

• Summer 2025: further consultation on drip pricing, specifically in relation to the unfair commercial practices guidance (target of Autumn 2025 for final guidance on drip pricing).
• Late 2025: agreement on the EU Green Claims Directive (target for entry into force in 2027).

Client Alert 2025-121