• FTC Proposes Revised Green Guides for Marketing
  • October 13, 2010 | Author: Mary E. Innis
  • Law Firms: Barnes & Thornburg LLP - Chicago Office ; Barnes & Thornburg LLP - Indianapolis Office
  • The Federal Trade Commission (FTC) has released its long-awaited proposed revisions to its Green Guides and is seeking public comment on those proposals until Dec. 10, 2010. The proposals would update the Green Guides that were first issued in 1992, and revised in 1996 and last updated in 1998. The Green Guides are administrative interpretations that create safe harbors for marketing claims, but they are not enforceable regulations. The FTC website provides a summary of the proposed revisions and a link to provide comments at www.ftc.gov/opa/2010/10/greenguide.shtm.

    While the FTC proposals do not provide any specific guidance about claims for "ustainable," "natural" or "organic" products, they do include guidance on marketers' use of certifications and seals of approval, renewable energy and renewable material claims, as well as carbon offset claims.

    The FTC Green Guides proposal includes the following:

    General Environmental Benefit Claims - (e.g. "green" or "eco-friendly")
    Marketers should not make unqualified, general environmental benefit claims as they may be difficult or impossible to substantiate. Qualifications should be clear, prominent and limited to a specific benefit. Marketers cannot use websites to qualify otherwise misleading claims.

    Certifications and Seals
    The proposal emphasizes that certifications and seals are endorsements covered by the Commission’s Endorsement Guides. Additionally, marketers must disclose “a material connection” between the endorser and the marketer. Finally, a third-party certification does not eliminate the marketer’s obligation to have substantiation for its claims.

    Degradable Claims
    Under the existing Green Guides, degradable claims required only that the breakdown and return to nature be “within a reasonable short period of time.” The new proposal would require complete decomposition is no more than one year after customary disposal.

    Compostable Claims
    Similarly, the current vague “timely manner” for compostable claims would be revised to require that the compostable material would break down in approximately the same time as materials with which it is composted.

    Ozone-Safe/Ozone Friendly
    The Green Guide updates reflect the changes in the regulations concerning ozone-depleting chemicals.

    Recyclable Claims
    For recyclable claims, if a “substantial majority” of consumers have access to the recycling facilities, then an unqualified recycling claim can be made. If only a significant percentage of consumers have access to the recycling facilities needed, then marketers should qualify the claim (“May be recyclable in your area”). If less than a “significant percentage” of consumers have access to the facilities required for recycling, marketers will need to further qualify the claim (“recyclable only in communities that have recycling programs”).

    “Free-Of” Claims
    Even technically true claims can be deceptive if the substance present poses the same risk as the “free-of” substance or if the “free-of” substance has never been associated with a product category. Free-of even may be appropriate when a de minimis amount of a substance is present; however, any free-of claim could convey a general benefit or superiority claim requiring qualification.

    New additions to the FTC Green Guides Proposal include the following:

    Made with Renewable Materials
    Marketers are encouraged to provide specific information about the renewable material involved, such as how it was sourced, and why it is renewable. If the item is not made entirely of renewable materials the claim should be qualified.

    Made with Renewable Energy
    Unqualified renewable energy claims should not be made if the power used to manufacture any parts of the product was derived from fossil fuels. Marketers should specify the source of the energy; qualification also would be called for when less than all (or virtually all) of the processes involved were powered with renewable energy. Further, a claim that an entity which generates electricity was using renewable energy would be deceptive if the entity was selling renewable energy certificates for all the power it generated (thereby allowing the buyer to claim it was using renewable energy).

    Carbon Offsets
    Marketers making claims about carbon offsets should have competent and reliable scientific evidence for their claims, including appropriate accounting methods for quantifying emission reductions and showing they are being sold only once. Marketers should disclose if the offset purchase funds emission reductions will occur for two years or longer. Finally, if the basis of the offset is already required by law, advertise it as a carbon offset would be deceptive.