The fines can reach up to 10% of a company’s global annual turnover, with details of the regulator’s enforcement priorities for the first 12 months set to be published this week.
The CMA has said it will initially focus on the “most egregious harms”, such as aggressive sales practices that prey on vulnerability, providing information to consumers that is objectively false, and contract terms that are very obviously imbalanced and unfair.
Commenting on the CMA’s approach, chief executive Sarah Cardell said: “I am confident [it] will deliver robust protections for consumers, focusing on clearly illegal conduct that results in tangible harms.
“At the same time, it gives businesses the clarity to comply as quickly as possible – and the confidence that early enforcement action will be proportionate. This is, after all, in the interests of both businesses and consumers; when businesses get it right, consumers benefit.”
Misleading environmental claims is one area that the CMA looks set to focus on, with further guidance available via its Green Claims Code.
Greenwashing has been a hot topic in the food and drink sector in recent years, with several high profile firms accused of not being honest with consumers.
For example, the Changing Markets Foundation and Greenpeace Nordic publicly accused Arla Foods of greenwashing in a report released in February and sent directly to the dairy co-operative.
Meanwhile, JBS global chief sustainability officer, Jason Weller, said in January that the net zero goals the firm set out in March 2021 represented an “aspiration” rather than a concrete commitment when asked about the firm’s progress.
This occurred after JBS was sued by the State of New York for allegedly misleading customers about its plans to reduce its impact on the environment.
Maddy Haughton-Boakes, senior campaigner at the Changing Markets Foundation, believes that the CMA’s new powers can play an important role in tackling greenwashing across the food and drink sector moving forward.
“The guidance is clear – companies cannot claim that a product is sustainable without taking into account the full life cycle of the product, nor can they make environmental claims which omit information about a product,” Haughton-Boakes said.
“Our greenwash monitoring shows extensive failure across the food sector to meet these simple rules. We hope that the CMA’s new powers will act as a strong deterrent to food companies making misleading environmental claims, and encourage them to ditch greenwashing for evidence-based commitments that will contribute towards rapidly cutting food sector emissions.”
The NGO has launched a website dedicated to documenting greenwashing in several sectors, including the food and drink industry.
