The amendments to the Law on the Prohibition of Unfair Commercial Practices (hereinafter – the Draft Law) approved by the Cabinet of Ministers will transpose into Latvian law the requirements of the EU Green Transition Act, which oblige traders to provide consumers with clear, substantive and reliable information about goods, services and digital content, and also introduce additional rules for preventing unfair commercial practices. The amendments to the law still have to be approved by the Saeima.

The Green Transition Act [1] sets out measures to improve consumer awareness and protection so that consumers can make sustainable consumption decisions and avoid misleading commercial practices.

The Green Transition Act will introduce specific rules to prevent unfair commercial practices relating to the early obsolescence of goods, misleading environmental claims ("greenwashing"), sustainability labels and various aspects of circularity.

This draft law marks a significant step in the green transition process, ensuring a higher level of consumer rights and environmental protection and promoting fair and transparent business practices.

A commercial practice will be considered misleading if a consumer is given information about environmental performance that is not supported by measurable, substantiated indicators and other elements, and if the trader advertises to consumers insignificant benefits that bear no relation to any feature of the goods, the service, the goods with digital elements, the digital service or digital content, or of the trader itself.

At the same time, the draft law lists commercial practices that are misleading to the consumer in all circumstances. Specifically, where the trader:

• uses a sustainability label that is not based on a certification scheme;
• is unable to demonstrate recognised excellent environmental performance when making environmental claims;
• presents particular features of goods, or of goods with digital elements, as distinctive even though the same features are already required across the European Union;
• claims that, in terms of greenhouse gas emissions, goods, a service, goods with digital elements, a digital service or digital content have a neutral, reduced or positive impact on the environment on the basis of greenhouse gas emissions offsetting;
• fails to state that a software update will adversely affect the use of goods, a service, goods with digital elements, a digital service or digital content;
• states that a feature limiting durability has been built in, or that goods, or goods with digital elements, have a particular durability under normal conditions of use in terms of the length or intensity of use;
• describes goods, or goods with digital elements, as repairable when repair is in fact not possible, and encourages the consumer to replace or purchase additional consumables sooner than is necessary;
• provides false information about the deterioration of the functionality of goods, or of goods with digital elements, if consumables, spare parts or other accessories not supplied by the original manufacturer are used.

In addition, when assessing a commercial practice, supervisory authorities will also have to take into account features relating to environmental, social and circularity aspects.

It should be noted that the requirements of the Green Transition Act will be transposed into Latvian law both through these amendments to the Law on the Prohibition of Unfair Commercial Practices and through the amendments to the Consumer Rights Protection Law approved at the Cabinet of Ministers meeting of 3 September 2024, as well as through amendments to two sets of Cabinet of Ministers regulations.

The requirements of the Green Transition Act will start to apply in all European Union Member States from 27 September 2026, and the aforementioned amendments to the law will enter into force on that date.

[1] Directive (EU) 2024/825 of the European Parliament and of the Council of 28 February 2024 amending Directives 2005/29/EC and 2011/83/EU as regards empowering consumers for the green transition through better protection against unfair practices and through better information