The Green Claims Code and DMCC Act: why environmental claims are now a legal matter for UK businesses

If your business makes any kind of environmental claim - on your website, in a tender, on your packaging, in a pitch deck - the Green Claims Code and the DMCC Act mean the rules around what you can say, and what you need to back it up, have changed significantly in the past 12 months.

For UK-operating businesses making environmental claims, the concern now isn't just reputational risk, it's legal liability.

What is the Green Claims Code?

The Green Claims Code is guidance published by the UK's Competition and Markets Authority (CMA) - the body responsible for protecting consumers and ensuring fair competition. It sets out six principles that any business making environmental claims needs to meet. The code itself is guidance, but it reflects your existing obligations under consumer protection law, which is legally enforceable.

According to the CMA, green claims must:

1. Be truthful and accurate
2. Be clear and unambiguous
3. Not omit or hide important information
4. Only make fair and meaningful comparisons
5. Consider the full life cycle of the product or service
6. Be substantiated - backed up with robust, credible, up-to-date evidence

These aren't aspirational guidelines, they reflect your obligations under consumer protection law. And for most businesses, the sticking point is the last one: substantiation.

Saying you're "committed to net zero" without a plan, data, or targets to support it? - that's a problem. Describing your services as "sustainable" without being able to explain what that means and prove it? - also a problem. The CMA has been clear that 40% of green claims made online could be misleading, and they intend to do something about it.

What changed in April 2025: the DMCC Act and CMA enforcement powers

Until recently, the CMA's main tool for addressing greenwashing was to take businesses to court. That process was slow, expensive, and reserved for the most clear-cut cases.

That changed on 6 April 2025, when the Digital Markets, Competition and Consumers Act 2024 (DMCC Act) came into force. Under the DMCC Act, the CMA can now investigate businesses, determine whether consumer protection laws have been breached, and issue fines - all without going to court.

The financial exposure is significant: fines of up to 10% of global annual turnover. For a business with £10m revenue, that's up to £1m. For a business with £50m revenue, up to £5m.

The CMA has also been transparent about where it will focus first: practices that are more harmful to consumers, and businesses that should already know their obligations, particularly where the CMA or another regulator has already published guidance. The Green Claims Code has been public since 2021, and the CMA's position is that there is no longer any excuse for not knowing the rules.

January 2026: New CMA supply chain guidance

The latest development came in January 2026, when the CMA published new guidance specifically covering environmental claims across supply chains.

The core message: responsibility does not sit with one party. If your business repeats, relies on, or passes on an environmental claim made by a supplier, and that claim turns out to be false or misleading, you may be liable, even if you didn't originate the claim.

The guidance is clear that businesses cannot simply take a supplier's word for it. If you are making a claim to a consumer or client based on information from someone else in your supply chain, you are expected to take reasonable steps to verify it.

This has direct implications for businesses that include environmental credentials in tender responses, client proposals, or marketing materials. If you're citing your carbon footprint, making net zero claims, or referencing your sustainability credentials,  you’ll need to demonstrate the methodology, the data, and the assurance process behind it.

What this means in practice

Greenwashing is no longer just a reputational risk for UK businesses - it's a compliance and legal one. Carbon neutral claims are among the most scrutinised. But any environmental claim your business makes publicly, now needs solid evidence behind it:

• "Our business is carbon neutral" - what scope? What methodology? What has actually been reduced versus offset?
• "We're on the path to net zero" - what is the target and timeline? What's the reduction plan?
• "We measure and manage our carbon footprint" - measured how? To what standard? Has it been independently checked?
• "Our products are sustainably sourced" - what does that mean in detail, and who verified it?

None of these claims are inherently problematic, but all of them require substantiation. Vague language, unsupported assertions, or claims based on limited data alone are increasingly difficult to defend.

The CMA has also made clear that an "innocent" breach is still a breach. What does matter, and what can mitigate the consequences, is whether your business has appropriate internal processes to verify claims before making them.

The role of carbon data

This is where carbon measurement becomes more than a compliance exercise.

Scope 1, 2 and 3 emissions all need to be accounted for in any footprint that will stand up to scrutiny. A full-scope, GHG Protocol-aligned carbon footprint, one that uses activity data rather than spend-based estimates alone, and has been independently checked, is the foundation of any claim you can defend.

If you're claiming to reduce emissions, you need a baseline that accurately reflects what you actually emit. If you're claiming progress, you need a methodology consistent enough year-on-year to demonstrate real change rather than measurement drift. If you're making claims to clients or in tenders, you need data you can share with confidence.

This is why the quality of your carbon data matters, not just for its own sake, but because it underpins every environmental claim your business makes.

At Seedling, every footprint we produce is full-scope and GHG Protocol-aligned, with a clear audit trail of data sources, emissions factors and estimates. Your footprint is assured by our team before it's signed off, giving you outputs you can share with clients, investors, and regulators without hesitation.

Green Claims Code compliance: a quick checklist

To substantiate environmental claims properly and stay on the right side of the CMA's guidance, every business should be able to answer these questions:

• Can we back this up with evidence that is robust, up-to-date, and credible?
• Does the claim accurately represent the full picture - not just the most favourable part of it?
• If the claim is based on information from a supplier or partner, have we verified it?
• Is the claim clear enough that a customer or client could not reasonably misinterpret it?
• Do we have internal processes in place for reviewing and approving environmental claims before they go out?

If the answer to any of these is uncertain, it's worth reviewing your claims, and the data behind them, before someone else does it for you.

Where to go from here

The CMA's Green Claims Code and the January 2026 supply chain guidance are both publicly available and worth reading in full if your business makes environmental claims of any kind.

If you want to make sure your carbon data is solid enough to stand behind your claims with confidence, talk to the Seedling team. We'll help you measure an accurate, full-scope footprint, give you the outputs to back up what you say, and advise on sustainability communications.