“Biodegradable” and “carbon neutral” sound clear. In practice, both depend on conditions that labels often leave out. Here’s what regulators in the US and Australia expect these claims to mean, and the short list of questions that will tell you whether a claim holds up.
Biodegradable
What it should mean
Something is biodegradable if microorganisms (bacteria and fungi) can break it down into natural substances such as water, carbon dioxide and biomass. In theory almost everything breaks down eventually. What matters is how long it takes and under what conditions.
What US guidance says
The FTC’s Green Guides (16 CFR 260.8) say an unqualified “biodegradable” or “degradable” claim implies that the entire item will completely break down and return to nature within a reasonably short time after customary disposal. The Guides treat “reasonably short” as no more than one year.
That’s a problem for most products, because the customary way to dispose of them is the trash. The Guides say unqualified degradable claims for items customarily disposed of in landfills, incinerators and recycling facilities are deceptive, because those places don’t provide conditions in which complete decomposition will happen within one year. (16 CFR 260.8, eCFR)
What Australian guidance says
The ACCC’s guide for business says environmental claims must be accurate, backed by evidence, and must explain any conditions on them. Its examples are specific. A business selling kitchen items certified as industrially compostable, which “will not break down in home composting conditions”, is likely to mislead if it advertises them simply as “certified compostable”; “certified industrially compostable” is the clearer claim. For biodegradable claims, the guide says a business that has tested its product under certain conditions could advertise that it biodegrades and “specify the circumstances where this will happen”. (ACCC guide, PDF)
Biodegradable isn’t the same as compostable
| Label | What it should mean | Where it actually breaks down |
|---|---|---|
| Biodegradable | Microbes can break it down, eventually | Depends entirely on conditions; often not stated |
| Compostable (industrial or commercial) | Breaks down in a commercial composting facility, which runs hotter and is more controlled than a home bin | Only if your area has a facility that accepts it |
| Home compostable | Breaks down in a well-managed backyard compost | Your own compost, given time |
Australian standards: AS 4736 covers plastics that are compostable in industrial facilities, and AS 5810 covers home compostable plastics. The Australasian Bioplastics Association (ABA) runs certification to both, and only products verified through its program can carry its logos. A certified product should show which standard it meets. (Australasian Bioplastics Association)
US: the FTC Green Guides say that if composting facilities aren’t available to a substantial majority of consumers where a product is sold, a compostable claim should say so. Third-party certification exists too, for example from the Biodegradable Products Institute (BPI), which certifies compostable products and packaging against ASTM standards in North America.
Watch for “oxo-degradable” plastics
Some plastics are sold as “degradable” because an additive makes them fall apart into smaller pieces. Falling into fragments isn’t the same as biodegrading, and it can leave microplastics behind. Some governments have banned these plastics. South Australia, for example, has made it an offence to sell, supply, distribute or manufacture oxo-degradable plastic products since 1 March 2022. (Replace the Waste, SA Government)
Questions to ask about a biodegradable claim
- Biodegradable where? Landfill, soil, water, industrial compost, home compost?
- How fast? Is there a timeframe, and a test standard that supports it?
- The whole product, or part? A “biodegradable” coffee pod with a plastic lid isn’t biodegradable as a whole.
- Is there certification to a named standard, from a body you can look up?
- What will you actually do with it? If it’ll go in the general waste bin, the claim may not help much.
Carbon neutral
What it should mean
“Carbon neutral” (or “net zero” for a product) means that the greenhouse gas emissions linked to a product, service or company have been measured and balanced out. That can happen through reductions, by buying carbon offsets, or both. The claim is only as good as the three parts behind it:
- The boundary. Which emissions are counted? Just the factory, or the materials, shipping and disposal too?
- The reductions. What has the company actually cut?
- The offsets. For what’s left, what kind of offsets were bought, and are they credible?
What US guidance says
The FTC Green Guides (16 CFR 260.5) say sellers of carbon offsets should use competent and reliable scientific and accounting methods to quantify emission reductions properly, and make sure the same reduction isn’t sold more than once. They also say marketers should clearly disclose if the offset’s emission reductions won’t occur for two years or longer. (16 CFR 260.5, eCFR)
What Australian guidance says
The ACCC’s guidance says businesses need evidence for their claims and shouldn’t hide important information. For carbon neutral claims, that means being clear about how much depends on offsets rather than actual emission cuts. In late 2026 the ACCC published separate guidance, Making emissions claims to consumers, which says businesses should use credible, science-based accounting standards and be transparent about their use of purchased carbon credits. (ACCC media release)
Climate Active has been the Australian Government’s carbon neutral certification program. In July 2026 the government announced that it plans to end Climate Active certification, and consulted on how to close it. If you see the Climate Active logo, check the department’s page for the current status and transition timeline. (DCCEEW announcement, DCCEEW, Climate Active)
Elsewhere: the European Union’s Directive (EU) 2024/825 bans claims, based on offsetting, that a product has a neutral, reduced or positive greenhouse gas impact. EU countries’ rules under it apply from 27 September 2026. That’s a sign of where regulation is heading.
Questions to ask about a carbon neutral claim
- Neutral for what? The product, the shipping, or the company’s offices?
- How much is reduction, and how much is offsetting? Is there a published breakdown?
- What offsets? Named projects? Verified by a recognized standard? Retired on a public registry?
- Is it certified, and can you look up the certification?
- Is there a public report you can actually read?
How we handle these claims on this site
- We quote these labels as the brand’s claim, and link the brand’s evidence, such as a certification or a report.
- We don’t call a product “biodegradable”, “compostable” or “carbon neutral” ourselves unless we can point to the certification and say what conditions apply.
- When a claim leaves out something important (the compost conditions, the offset share), we say so.
Read the full method: How we judge green claims.
If you’re shopping for compostable products
If you have a home compost, look for products certified home compostable (AS 5810 in Australia). If your council or city collects food scraps for commercial composting, check which certified items it accepts before you buy. Many programs don’t take compostable plastics at all. No yard? See composting in an apartment.
Browse compostable bin liners on Amazon (US). Check each listing for the named certification.
How we picked
- We link a search for certified compostable liners, not a single product, because we couldn’t verify which individual listings carry a current certification.
- What we look for in a listing: a named standard (AS 5810 or AS 4736 in Australia; a named certifier such as BPI in the US), a certificate or license number you can look up, and clear conditions (home or industrial).
- We haven’t tested any compostable liners, and we don’t rank them.
- The explanations in this article come from the regulators’ own guidance, linked below. They aren’t legal advice.
Sources
- US FTC, Guides for the Use of Environmental Marketing Claims, 16 CFR Part 260 (see 260.5 carbon offsets, 260.7 compostable, 260.8 degradable): ecfr.gov
- ACCC, Making environmental claims: A guide for business (Dec 2023): accc.gov.au
- ACCC, media release on the eight principles: accc.gov.au
- ACCC, Making environmental claims (PDF): accc.gov.au
- ACCC, media release on emissions claims guidance: accc.gov.au
- DCCEEW, Evolving climate policy brings Climate Active certifications to a close: dcceew.gov.au
- DCCEEW, Climate Active: dcceew.gov.au
- Australasian Bioplastics Association: bioplastics.org.au
- Biodegradable Products Institute: bpiworld.org
- South Australian Government, oxo-degradable plastics ban: replacethewaste.sa.gov.au
- Directive (EU) 2024/825: eur-lex.europa.eu