The Federal Trade Commission has issued its long awaited, final version of its “Green Guides,” formally known as the FTC’s Guides for the Use of Environmental Marketing Claims. The FTC issued a proposed draft version of the Green Guides in late 2010 for review, and after a long public comment period, issued the final revised Green Guides earlier this month, available here. The Guides incorporate many of the changes outlined in the 2010 draft version, and provide both specific guidance and examples for marketers.

By way of background, the FTC issued its original version of the Green Guides in 1992, and updated them twice in the 1990’s, but made no further revisions until issuing the 2010 draft version. As with other FTC public position statements, the new Green Guides do not carry the force of law, but do provide insight for the marketplace as to what the FTC may or may not view as deceptive. The new, final version addresses certain environmentally oriented claims for the first time, and also provides updated guidance regarding common environmental claims that past versions of the Guides addressed. The FTC updated its guidance regarding the following types of claims:

  • general environmental benefit claims;
  • compostability claims;
  • degradability claims;
  • ozone-safe/friendly claims;
  • recyclable claims;
  • r efillable claims;
  • recycled content claims; and
  • source reduction claims.

The new environmental claims addressed by the FTC in its final Green Guides include claims about carbon offsets; certifications and seals of approval; free-of claims; non-toxic claims; and claims that products or packaging are made with renewable energy or renewable materials.

For your reference, we include a brief overview of the updated and new claims included in the Guides. For more a more detailed explanation of the new Green Guides, please contact the authors of this article, or your existing firm contact.

General Environmental Benefit Claims

  • Marketers should avoid making broad, unqualified general environmental benefit claims like ‘green’ or ‘eco-friendly’ on the theory that they are difficult, if not impossible, to substantiate.
  • Marketers should clearly, prominently, and specifically qualify general claims about specific environmental benefits. Particularly, marketers should be certain not to overstate the significance of a small or unimportant environmental benefit for fear that consumers could put too much faith in the claim. For example, a claim that a product is made from recycled content might be material to a consumer, and such a claim could be misleading where the environmental costs of using recycled content outweigh the environmental benefits.

Claims about Carbon Offsets

  • Claims about carbon offsets should be based on competent and reliable scientific evidence, and use appropriate accounting methods to ensure emissions reductions are measured properly and not sold more than once.
  • Marketers should disclose whether the offset purchase pays for emissions reductions that will not occur for at least two years.
  • If the law already requires the activity that is the basis for the offset, then the offset should not be advertised.

Claims based on Certifications and Seals of Approval

  • Certifications and seals may be endorsements and thus are covered by the FTC’s Endorsement Guides, which state that:
    • Material connections to the certifying organization should be disclosed; seals or certifications should clearly convey the basis of the certification to ensure it is not based on merely a general environmental benefit; and, where seals or certifications do not adequately convey the basis for certification, marketers should clearly and prominently identify the specific environmental benefits.
    • Marketers can qualify certifications based on attributes that are too numerous to disclose by saying, “Virtually all products impact the environment. For details on which attributes we evaluated, go to a [website that discusses this product].” Of course, the marketer should make sure that the website provides the referenced information and that it is truthful and accurate.
    • Marketers with third-party certification must still substantiate all express and implied claims.

Compostability Claims

  • Claims should be based on competent and reliable scientific evidence that all materials in the product or package are in fact compostable, and claims should be qualified where the product cannot be composted at home in a safe or timely manner.
  • Claims should also be qualified where products can be composted in a municipal or institutional facility if the facilities are not available to a substantial majority of consumers.

Degradability Claims

  • Unqualified claims about biodegradability should only be made if it can be proven that the “entire product or package will completely break down and return to nature within a reasonably short period of time after customary disposal.” And a “reasonably short period of time” is one year. Further, items destined for landfills, incinerators, or recycling facilities will not degrade within a year and, therefore, should not be claimed to be degradable.

Free-of Claims

  • Claims that a product is free of a substance can be made where: (1) the product does not have more than trace amounts or background levels of the substance; (2) the amount of substance present does not cause the harm that consumers typically associate with the substance; and (3) the substance was not intentionally added to the product.
  • Claims that a product is free of a particular substance would be deceptive where the product contains a different substance that poses a similar environmental risk.
  • A claim that a product does not contain a substance may be deceptive if that substance has never been associated with that product category before.

Non-Toxic Claims

  • Non-toxic claims should be based on competent and reliable scientific evidence that the product is safe for people and the environment.

Ozone-Safe/Friendly Claims

  • Misrepresenting a products effect on the ozone layer would be deceptive.

Recyclability Claims

  • Claims of recyclability should be qualified where facilities are not available to at least 60 percent of consumers or communities where a product is sold, and the lower the level of access to recycling facilities, the more emphasis should be given to the limited availability of recycling.

Claims about Recycled Content

  • Claims about recycled content should be made only where materials have been recovered or diverted from the waste stream during the manufacturing process or after consumer use.
  • Claims should be qualified where products or packaging is made only partly from recycled material, i.e. “Made from 30% recycled material.”
  • Claims about used, reconditioned, or re-manufactured components should be qualified clearly and prominently to avoid deception about the components.

Refillable Claims

  • Unqualified claims about refillability should only be made where there is a way to refill the package, i.e. providing a system for refilling or selling a separate package for refilling the original.

Renewable Energy Claims

  • Unqualified renewable energy claims based on energy derived from fossil fuels should be avoided unless renewable energy certificates (“RECs”) that match energy use were purchased.
  • To minimize the risk that consumers will interpret a renewable energy claim as a recycled content claim or a renewable materials claim, unqualified renewable energy claims should clearly and prominently specify the source of the renewable energy, i.e. wind or solar.
  • Unqualified “made with renewable energy claims” should not be made unless all or virtually all of the significant manufacturing processes involved in producing the product or packaging are powered with renewable energy, or non-renewable energy matched by RECs.
  • Marketers that generate renewable energy, but sell RECs for all the renewable energy that they generate, should not claim they use renewable energy. Use of the term “hosting” would be deceptive in this circumstance.

Renewable Materials Claims

  • Claims about renewable materials may imply that a product is recyclable, made with recycled content, or biodegradable. To minimize the risk of deception, the claim should clearly and prominently identify the material used and why it is renewable, i.e. “Our flooring is made from 100% bamboo, which grows at the same rate, or faster, than we use it.”
  • Unless an item is made entirely with renewable materials, except for minor and incidental components, renewable materials claims should always be qualified.

Source Reduction Claims

  • Claims that a product or package is lower in weight, volume, or toxicity should be qualified clearly and prominently to avoid deception about the amount of reduction and the basis for comparison. For example, “10 percent less waste than our previous product”, not “10 percent less waste.”