FTC Issues Revised "Green Guides"

by Sheppard Mullin Richter & Hampton LLP
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[author: Robert Magielnicki]

On October 1, 2012, the Federal Trade Commission issued revised “Guides For The Use Of Environmental Marketing Claims” – the “Green Guides,” 16 CFR Part 260. The Green Guides originally were issued in 1992 and were revised in 1996 and 1998. The review resulting in the latest revisions began in November 2007.

The Green Guides set forth the FTC’s views concerning environmental claims and are intended to help marketers avoid making environmental marketing claims that are unfair or deceptive and thus violative of Section 5 of the FTC Act. The Guides are administrative interpretations of the law and thus do not have the force and effect of law. However, the FTC can take action under the FTC Act if a marketer makes an environmental claim that is inconsistent with the Guides.

The Guides apply to claims about the environmental attributes of a product, package or service in connection with the marketing or sale of such item or service to individuals or in business-to-business transactions. They apply to claims in labeling, advertising, promotional materials and all other forms of marketing in any medium, whether asserted directly or by implication.

The Green Guides consist of general principles, specific guidance on the use of particular environmental claims, and examples. They begin by reaffirming the FTC’s long-standing position regarding deceptive advertising claims:

  • A claim is deceptive if it is likely to mislead consumers acting reasonably under the circumstances and is material to consumers’ decisions.
  • Marketers must identify all express and implied claims that the advertisement reasonably conveys, and ensure that all such claims are truthful, not misleading, and supported by a reasonable basis before the claims are made.
  • A reasonable basis often requires competent and reliable scientific evidence consisting of tests, analyses or studies conducted and evaluated in an objective manner by qualified persons and are generally accepted in the profession to yield accurate and reliable results.

The Green Guides underscore the FTC’s antipathy to general environmental claims, such as “green” or “eco-friendly.” According to the FTC, such claims are difficult to interpret and likely convey a wide range of meanings. In many cases, such claims convey that the product has far-reaching environmental benefits with no negative environmental impact. “Because it is highly unlikely that the marketers can substantiate all reasonable interpretations of these claims, marketers should not make unqualified general environmental benefit claims.”

The Green Guides also provide that an environmental claim should specify whether it refers to the product, the packaging, a service or just a portion of the product, packaging or service. Qualifications and disclosures should be clear, prominent and understandable. This includes using plain language and sufficiently large type, placing disclosures in close proximity to the qualified claim, and avoiding inconsistent statements. Comparative claims should be clear and substantiated. With regard to third party certifications and seals of approval, the Guides warn that they may be an endorsement subject to the FTC’s Endorsement Guides and that their use must include the specific basis for the certification or seal.

The Guides also provide specific guidance, including examples, for a plethora of particular environmental claims. These include:

  • Carbon Offsets
  • Certifications and Seals of Approval
  • Compostable Claims
  • Degradable Claims
  • Free-Of Claims
  • Non-Toxic Claims
  • Ozone-Safe and Ozone-Friendly Claims
  • Recyclable Claims
  • Recycled Content Claims
  • Refillable Claims
  • Renewable Energy Claims
  • Renewable Materials Claims
  • Source Reduction Claims

The Green Guides can be found at http://business.ftc.gov.

 

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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