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<ns0:ActionText>INTRODUCED</ns0:ActionText>
<ns0:ActionDate>2026-02-12</ns0:ActionDate>
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<ns0:AuthorText authorType="LEAD_AUTHOR">Introduced by Assembly Member Rogers</ns0:AuthorText>
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<ns0:Name>Rogers</ns0:Name>
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<ns0:Title> An act to add Section 17580.7 to the Business and Professions Code, relating to advertising. </ns0:Title>
<ns0:RelatingClause>advertising</ns0:RelatingClause>
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<ns0:Subject>Advertising: environmental marketing claims: carbon credits.</ns0:Subject>
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<html:p>Under existing law, it is unlawful for a person to make an untruthful, deceptive, or misleading environmental marketing claim, whether explicit or implied. A violation of this requirement is a misdemeanor.</html:p>
<html:p>This bill would establish a defense to any suit or complaint brought under the above-described provision if the person’s environmental marketing claim is based on the voluntary use of a carbon credit issued by a carbon crediting program that is (1) approved by the State Air Resources Board pursuant to specified regulations, (2) approved by the International Civil Aviation Organization to supply credits for a specified carbon offsetting scheme, or (3) meets other specified criteria. The bill would require the state board, within ____ days of January 1, 2027, to publish and maintain a list of carbon crediting programs that satisfy the criteria set
forth in the third category.</html:p>
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<ns0:Preamble>The people of the State of California do enact as follows:</ns0:Preamble>
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<ns0:Num>SECTION 1.</ns0:Num>
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Section 17580.7 is added to the
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, to read:
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(a)
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It shall be a defense to any suit or complaint brought under Section 17580.5 if the person’s environmental marketing claim is based on the voluntary use of a carbon credit issued by a carbon crediting program that meets any of the following requirements:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
The carbon crediting program is approved by the State Air Resources Board pursuant to Section 95986 of Title 17 of the California Code of Regulations.
</html:p>
<html:p>
(2)
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The carbon crediting program is approved by the International Civil Aviation Organization to supply credits for use in the Carbon Offsetting Reduction Scheme for International Aviation.
</html:p>
<html:p>
(3)
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The carbon
crediting program satisfies the criteria set forth in subdivision (b).
</html:p>
<html:p>
(b)
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A program shall qualify as a carbon crediting program for purposes of paragraph (3) of subdivision (a) if it does all of the following:
</html:p>
<html:p>
(1)
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Adopts clear methodologies and protocols with transparent development processes that accommodate public input, and publicly discloses all approved quantification methodologies.
</html:p>
<html:p>
(2)
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Defines and publicly discloses the level at which activities are allowed, for example project based, program of activities, and eligibility criteria for each type of credited activity.
</html:p>
<html:p>
(3)
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Establishes and publicly discloses procedures for how carbon credits are discounted, issued, retired or canceled, and the length of the crediting period.
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(4)
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Has mechanisms and procedures to do all of the following:
</html:p>
<html:p>
(A)
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Track units in a publicly accessible registry.
</html:p>
<html:p>
(B)
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Individually identify units through serial numbers or other unique identifiers.
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<html:p>
(C)
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Provide a secure registry.
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<html:p>
(D)
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Clearly identify unit holders.
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<html:p>
(5)
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Has in place program-level requirements for robust independent third-party validation and verification of mitigation activities, including the establishment and enforcement of oversight standards for validation and verification bodies that comply with the requirements of subdivision (d) and perform an annual examination of a representative sample of project
validations and verifications.
</html:p>
<html:p>
(6)
<html:span class="EnSpace"/>
Has and discloses an effective program governance structure that ensures transparency, accountability, and continuous improvement and the overall quality of carbon credits, and has a program governance structure that meets all of the following criteria:
</html:p>
<html:p>
(A)
<html:span class="EnSpace"/>
It has a board comprising independent board members who assume a fiduciary responsibility for the organization and operate according to robust bylaws and have established processes for addressing conflicts of interest.
</html:p>
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(B)
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It publishes an annual report containing the organization’s revenues, expenses, and net assets.
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(C)
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It has robust anti-money laundering processes in place and follows practices consistent with robust antibribery and anticorruption guidance and
regulation.
</html:p>
<html:p>
(7)
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Publicly discloses in an electronic format accessible to nonspecialized audiences all of the following:
</html:p>
<html:p>
(A)
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What information is captured and made available to different stakeholders.
</html:p>
<html:p>
(B)
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Local stakeholder consultation requirements.
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<html:p>
(C)
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Public grievance and consultation provisions and requirements, and how they are considered.
</html:p>
<html:p>
(8)
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Has clear guidance, tools, and compliance procedures to ensure mitigation activities conform with or go beyond widely established industry best practices on social and environmental safeguards while delivering positive sustainable development impacts.
</html:p>
<html:p>
(9)
<html:span class="EnSpace"/>
Provides information on how
it addresses double counting and double issuance and double claiming in the context of evolving national and international regimes for carbon credit markets and tracking.
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<html:p>
(10)
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Has provisions that ensure the mitigation activity shall be permanent or, where there is a risk of reversal, have measures in place to address those risks or compensate for reversals.
</html:p>
<html:p>
(c)
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(1)
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Within ____ days of January 1, 2027, the State Air Resources Board shall publish and maintain a list of carbon crediting programs that satisfy the requirements of subdivision (b).
</html:p>
<html:p>
(2)
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Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code does not apply to the publication and maintenance of the list pursuant to paragraph (1).
</html:p>
<html:p>
(d)
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An entity shall qualify as a third-party credit validation and verification body for purposes of subdivision (b) if it satisfies either of the following:
</html:p>
<html:p>
(1)
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Any of the accreditation requirements set forth under Sections 95132 and 95978 of Title 17 of the California Code of Regulations.
</html:p>
<html:p>
(2)
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All of the following requirements:
</html:p>
<html:p>
(A)
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Be accredited by an International Accreditation Forum (IAF) Multilateral Recognition Arrangement recognized accreditation body for International Organization for Standardization (ISO) 14065 and ISO 14064-3 in the applicable sectoral scope to conduct validations or verifications, or both, or under an equivalent approved accreditation body covering the scope of that regulation under the most current version of ISO 14065 in the applicable sectoral scope to conduct validations or
verifications, or both.
</html:p>
<html:p>
(B)
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Be competent to carry out validation and verification under the requirements of the respective carbon crediting body.
</html:p>
<html:p>
(C)
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Have policies in place to identify and mitigate financial and all other conflicts of interest and is not a mitigation project developer or proponent, the owner of a mitigation project developer or proponent, or be owned by them.
</html:p>
<html:p>
(D)
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Have adequate professional insurance for the geographic market in which it is operating, including a minimum of two million dollars ($2,000,000) of professional liability insurance if operating in the United States.
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