Greenwashing Rules May Get A Makeover In Canada's 2025 Budget

The federal government's 2025 budget proposes significant changes to Canada's greenwashing provisions under the Competition Act (Act). The federal government recognized that the greenwashing provisions are creating investment uncertainty and causing some parties to slow or reverse efforts to protect the environment. Aiming to provide greater clarity and certainty for businesses, the proposed measures would:

• Remove the requirement to use internationally recognized methodologies when substantiating environmental benefit claims about a business or business activity; and
• Eliminate private access to the Competition Tribunal for greenwashing complaints.

These changes follow recent amendments to the Act that expanded the Commissioner of Competition's ability to take enforcement action against misleading environmental claims. Under the current framework, companies must ensure that: