On October 6, 2010, the Federal Trade Commission (FTC) unveiled long-awaited proposed revisions to its Guides for the Use of Environmental Marketing Claims, known as the “Green Guides,” which were last updated in 1998 (available at http://www.ftc.gov/os/fedreg/2010/october/101006green guidesfrn.pdf). The Green Guides assist marketers in ensuring that “green” advertising claims are true and substantiated. As part of its revision effort, the FTC relied on public workshops, comments and a study of consumers’ perceptions of environmental claims. Moreover, the FTC has requested public comments on the proposed revisions, through December 10, 2010, after which time the FTC will decide what changes to make final.
Preventing consumer deception remains paramount, and the proposed revisions include guidance on claims both addressed and unaddressed by the existing Green Guides. Claims currently addressed by the existing Green Guides which are updated include general environmental benefit claims, use of certification and third-party seals of approval, and use of terms that convey a “green-friendly” benefit such as “degradable,” “compostable,” “recyclable” and “non-toxic.” Claims not addressed by the existing Green Guides for which guidance is proposed includes “made with renewable materials,” “made with renewable energy” and carbon offset claims.
While the entire proposed, revised Guides merit review, one key change regarding general environmental benefit claims has far-reaching application.
General “Eco-Friendly” Claims a No-No
Perhaps most importantly, the proposed, revised Guides caution marketers against making unqualified general claims that a product is “environmentally friendly” or “green.” Anyone paying attention to the current marketplace knows that such general environmental claims are pervasive. The previous Guides had allowed marketers to make such unqualified claims so long as the marketers could substantiate all express and implied claims. If substantiation was not available, marketers were to qualify these general claims.
However, in its research in connection with the proposed, revised Guides, the FTC found that consumers interpret unqualified “eco-friendly” claims as meaning the products have far-reaching environmental benefits and specific attributes such as being biodegradable, non-toxic or made with renewable energy. Since few, if any, products have all of the attributes that consumers interpreting “eco-friendly” claims believe them to have, the FTC considers these general claims as nearly impossible to substantiate. Moreover, because a significant number of consumers perceive these general “green” claims as suggesting the product has no environmental impact, and because all products have some environmental impact, it is highly unlikely that a marketer could substantiate that a product has no or negligible negative environmental impact. Thus, in a departure from the previous Guides, the proposed, revised Guides advise marketers not to make unqualified general environmental benefit claims.
Qualifying General “Eco-Friendly” Claims
The FTC found, however, that qualifying a general environmental benefit claim can reduce consumers’ misperceptions regarding a product’s specific, unstated benefits or the absence of a negative environmental impact. Accordingly, the proposed, revised Guides state that marketers must use clear and prominent language to convey that a general environmental claim refers only to a specific and limited environmental benefit. Nonetheless, the Guides warn that explanations of specific environmental attributes will not qualify a general claim if the advertisement’s context implies other deceptive claims, and that some qualifications can result in additional claims that cannot be substantiated. Thus, marketers should avoid unqualified general environmental benefit claims and should be particularly careful when qualifying those claims.
The proposed, revised Green Guides are extensive, and will have far reaching impact on how advertisers communicate environmental benefit claims.