Green claims in Canada after the March 2026 change: what your brand can still say
The direct answer
Canada's Competition Act, section 74.01(1), treats two kinds of environmental claim as deceptive unless properly supported. A claim about a product's environmental benefit must rest on an adequate and proper test, with the proof on the business making it. A claim about the benefit of a business or business activity, such as a net zero target, must rest on adequate and proper substantiation. Amendments with Royal Assent on 26 March 2026 removed the earlier requirement that business level substantiation follow an internationally recognized methodology, and stopped private parties from bringing Competition Tribunal cases on business level claims; product claims remain open to private applications. Penalties for corporations reach the greater of $10 million, $15 million for repeat orders, and three times the benefit, or 3% of worldwide gross revenues when the benefit is hard to determine. The Competition Bureau's guidance asks for claims that are clear, specific and free of exaggeration.
Five conclusions
The argument, compressed.
- Product environmental claims need an adequate and proper test, and the business carries the proof.
- Business level claims, such as net zero targets, need adequate and proper substantiation; the internationally recognized methodology wording was removed on 26 March 2026.
- Private parties can no longer take business level claims to the Competition Tribunal; product claims remain open to them.
- Corporate penalties reach the greater of $10 million ($15 million for repeat orders) and three times the benefit, or 3% of worldwide revenues.
- The Bureau's working rule for wording: be specific, avoid exaggeration, and when in doubt, spell it out.
Working framework · 4 decisions
The green claim rewrite
Run every environmental word on the pack, website and ads through these four steps. The aim is a claim narrow enough to prove and specific enough to mean something.
Decision 01 / 04
Locate
Is the claim about a product or about the business? Product claims need a test; business claims need substantiation.
What the Competition Act says now
Section 74.01(1) of the Competition Act covers two kinds of environmental claim. Paragraph (b.1) applies to a product's benefits for the environment and requires an adequate and proper test, with the proof on the person making the claim. Paragraph (b.2) applies to the environmental benefits of a business or business activity and requires adequate and proper substantiation, again with the proof on the person making it.
When these provisions arrived in June 2024, paragraph (b.2) required that substantiation to follow an internationally recognized methodology. The Budget 2025 Implementation Act, No. 1, which received Royal Assent on 26 March 2026, removed that phrase. It also added a rule that business level claims under (b.2) are outside private applications to the Competition Tribunal, so only the Competition Bureau can pursue them. Product claims under (b.1) remain open to private applications.
Many pages still ranking for this topic describe the 2024 version. The Bureau itself flags that its environmental claims guidance still carries the old methodology language and will be updated.
What changed in 2026
The methodology test went, and private challenges to business level claims went. The duty to prove both kinds of claim stayed.
Penalties
Deceptive marketing orders under section 74.1 can include administrative monetary penalties. For a corporation the ceiling is the greater of $10 million, or $15 million for each subsequent order, and three times the value of the benefit derived; where that benefit is hard to determine, the alternative is 3% of annual worldwide gross revenues. For an individual it is the greater of $750,000, or $1 million for subsequent orders, and three times the benefit. The Act provides a due diligence defence.
Writing green claims that hold up
The Competition Bureau's guidance sets out six principles. Two matter most for brand language: claims should be clear and specific rather than vague, and comparative claims should be specific about what is being compared. The Bureau's own example is that eco friendly can imply a benefit across a product's whole life cycle, which few products can prove. Its summary advice is short: when in doubt, spell it out.
For a brand, specificity is also better positioning. "Made with 70% recycled aluminium" is provable and memorable. "Sustainable" is neither. A refill programme with a published number of returns tells a stronger story than a green leaf icon.
Future claims need the most care. A net zero by 2035 line on a website is a claim about the business, and the Bureau expects substantiation and a clear plan behind any claim about the future. Publish the plan, the interim targets and what is measured, or leave the target off the brand.
- Audit every leaf icon, earth graphic and green word in the identity.
- Replace vague words with one measurable attribute per product.
- File the test or substantiation before launch.
- Pair any future target with a published plan.
Before you use it
Questions that can change the recommendation.
Did Canada remove the internationally recognized methodology requirement for green claims?
Yes. Amendments with Royal Assent on 26 March 2026 removed the phrase from section 74.01(1)(b.2) of the Competition Act. Business level environmental claims still need adequate and proper substantiation.
Can competitors or consumers still challenge environmental claims in Canada?
Since March 2026, private parties are barred from taking business level claims under paragraph (b.2) to the Competition Tribunal. Product claims under (b.1) remain open to private applications, and the Competition Bureau can pursue both.
What are the penalties for greenwashing in Canada?
For a corporation, administrative monetary penalties can reach the greater of $10 million ($15 million for subsequent orders) and three times the benefit, or 3% of annual worldwide gross revenues if the benefit is hard to determine.
Can I call my product eco friendly in Canada?
The Competition Bureau warns that vague terms such as eco friendly can imply benefits across the whole product life cycle. A specific, tested attribute, such as recycled content, is safer and more persuasive.
Research record
What this guide draws from.
Each source note describes what the reference supports. Platform guidance, research findings and Branding Tatva's practical suggestions have different scopes.
- Competition Act (R.S.C. 1985)
Justice Laws Website
Current to 2026-09-21, last amended 2026-03-26; sections 74.01 and 74.1.
- Environmental claims and the Competition Act
Competition Bureau Canada
June 2025 guidance; the Bureau notes it will update the methodology language.
