Canada is rolling out strict new rules to keep companies honest about their environmental claims, reported Forbes.
The Canadian government updated its Competition Act in June, targeting businesses that overstate their planet-friendly actions in marketing materials.
For American companies operating in Canada, this brings both new responsibilities and potential financial penalties. The Canadian Competition Bureau released draft guidelines on Dec. 23 and wants to hear from affected businesses by Feb. 28.
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No 🚫 The push for clearer standards comes as more companies promote their environmental initiatives to meet growing consumer demand for sustainable products and services. Without firm regulations, many businesses make broad claims without proper documentation. Over the past year, legal action against misleading environmental marketing has increased worldwide.
The new rules focus on any statements about protecting nature or addressing overheating. Companies must back up their claims using internationally accepted methods. The Competition Bureau outlined six key principles, including requirements that environmental statements be truthful, specific, well-tested, and supported by clear action plans.
This development puts Canada among other regions strengthening oversight of environmental marketing.
"Notably, the E.U. is currently drafting strict greenwashing legislation that could become the global standard," wrote environmental, social, and governance expert Jon McGowan for Forbes. He says the trend shows growing pressure on businesses to prove their environmental promises.
For everyday shoppers, these rules mean more transparency about the true impact of products and services they buy. Companies will need real evidence before claiming their offerings help the planet. This helps consumers make informed choices about supporting genuinely sustainable businesses.
The timing adds another layer of complexity for U.S. businesses already working to meet new reporting requirements. Companies have until Feb. 14 to respond to California's latest environmental reporting rules, per McGowan making early 2025 a busy period for environmental compliance teams. Those doing business in Canada would benefit from reviewing their marketing materials now to prepare for these incoming standards.
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