ACCC emissions claims guidance warns lab-based vehicle advertising can mislead

ACCC publishes emissions claims guidance

The Australian Competition and Consumer Commission has published new guidance titled Making emissions claims to consumers – a guide for business, released on 20 October 2026 to help businesses make accurate and credible emissions claims under the Australian Consumer Law. ³²

In the accompanying media release, ACCC Deputy Chair Mick Keogh said consumers should be able to trust the emissions-related claims businesses make, and that greenwashing limits consumers' ability to make informed purchasing decisions while disadvantaging businesses that have invested in genuinely more sustainable products. He encouraged businesses to review their consumer-facing emissions claims in light of the guidance and to update messaging, gather stronger evidence or reconsider claims that raise concerns. ³

The ACCC notes that false or misleading environmental claims risk breaching the Australian Consumer Law, and says misleading emissions claims can harm fair competition, reduce consumer trust and make the transition to low or no emission technologies less efficient. The guidance complements and builds on general environmental claims guidance the ACCC first published in 2023. ³²⁴

The central test: overall consumer impression

The guide's central test is the overall impression a claim gives an ordinary consumer. The ACCC advises that fine print will rarely fix a misleading headline, and businesses are told to avoid broad or vague claims such as 'carbon neutral' or 'net zero' in short-form marketing, to be transparent about carbon credits, and to have reasonable grounds for claims about the future. ¹³

The ACCC's published checklist sets out six prompts for businesses: ensuring claims rest on complete, reputable and clear accounting; avoiding highly selective or broad, non-specific claims; being transparent about the use of credits; avoiding double counting of emissions changes; being clear about a business's own efforts versus broader changes and legal obligations; and having reasonable grounds before making claims about future events. It advises businesses unsure of any check to clarify wording, gather stronger evidence or reconsider using the claim. ⁴³

The guidance recognises carbon credits and certificates as a complement to direct emissions reductions, but the ACCC says businesses must have a reasonable basis where marketing gives the impression that two activities are equivalent, neutralise or cancel each other out. ³

Hybrid SUV example highlights lab versus real-world gap

One of the guide's worked examples is a hypothetical hybrid SUV advertised with the tagline 'Drive cleaner. Choose the planet friendly hybrid SUV.' In the example, laboratory tests show lower tailpipe emissions, but real-world data shows emissions similar to or higher than many comparable petrol SUVs. The ACCC says the claim is likely to be misleading. By contrast, an EV comparison that states its basis and draws on real-world driving data is considered unlikely to mislead. ¹

The guide does not set penalties. It says whether consumer law has been breached is a matter for the courts, and that the ACCC may investigate or consider enforcement action. ¹

AAA says guidance supports real-world vehicle testing

The Australian Automobile Association says the new ACCC guidance supports its case for judging cars on real-world testing rather than laboratory results, as reported by AutoTalk. The AAA's Real-World Testing Program, funded by the federal government, has tested hundreds of vehicles sold in Australia and says some have recorded fuel use and CO2 emissions on the road more than 30 per cent above the figures in manufacturers' marketing and sales material, a gap it has reported in earlier results. ¹

AAA managing director Michael Bradley told AutoTalk that one of the clearest examples for Australian motorists is the gap that can exist between vehicle emissions and fuel consumption reported by manufacturers and results achieved on Australian roads. He said consumers reasonably expect claims about a vehicle's environmental performance to reflect everyday driving conditions rather than performance that can only be replicated in controlled lab conditions, and that buyers of vehicles advertised as delivering a particular fuel consumption or emissions outcome should be confident those claims are close to what they will experience in the real world. ¹

Bradley also said manufacturers offering vehicles that genuinely deliver lower emissions on Australian roads should be recognised and rewarded, while consumers deserve clear and accurate information where advertised performance and real-world outcomes differ. The AAA says independently verified data will become more important as buyers weigh up hybrids, plug-in hybrids and battery EVs. ¹

Enforcement context

Greenwashing is a current ACCC compliance and enforcement priority. Since making it a priority in 2023 and releasing its first environmental claims guidance, the ACCC says it has observed significant changes in the sustainability claims of large companies across sectors including aviation, energy, logistics and telecommunications, with some businesses moving away from vague carbon neutral claims and distant future targets toward greater transparency about real-world impacts and reliance on credits. ³

The ACCC says it will continue to monitor this trend and consider targeted enforcement action for ongoing problematic conduct where appropriate. Its recent enforcement activity includes a Federal Court order for Clorox Australia to pay $8.25 million in penalties over misleading 'ocean plastic' claims about certain GLAD products, and Federal Court proceedings commenced against Australian Gas Networks over its renewable gas campaign and against the maker of Banana Boat and Hawaiian Tropic sunscreens over 'reef friendly' claims. ³