After 35 months, numerous public hearings, thousands of comments, and countless taxpayer-funded Commission staff hours surfing the web, the Federal Trade Commission (FTC) has at last issued updates to its “Guides for the Use of Environmental Marketing Claims” (aka “Green Guides). The proliferation of “green” claims in product and corporate image advertising since the Green Guides were last updated in 1998 is breathtaking. As the authors of a 2008 Washington Legal Foundation Legal Backgrounder noted, “Calls to ‘save the planet’ are no longer limited to advertisers of hemp oils and compost bins. Major corporations in every industry have taken up the cause.” The Commission’s release and links to the Federal Register notice and other documents is here.
One of the documents FTC prepared, “Green Marketing Internet Surf,” reveals how broadly these issues, and the Commission’s guidance, impact U.S. free enterprise. FTC Enforcement Division staff reviewed 1,000 web pages for green claims in the area of “sustainability,” “carbon neutral/carbon offset,” “renewability,” and general environmental claims. Among the industries making such claims were: Building, Home Improvement & Appliances; Utilities & Energy; Food & Beverage; Textiles; Computers & Electronics; Automotive; Paper & Packaging; and Health and Personal Care.
The proposed Green Guides revise some of the 1998 guidelines in rather significant ways, including a specific timetable for calling something “degradable” (full decomposition within one year); a more forceful statement that general terms like “green” and “eco-friendly” should not be used in marketing; new language on when marketers should qualify their statement that the product is “recyclable” (based on how many of the product’s consumers have access to recycling facilities); and a new section on the use of seals and certifications conveyed on products by third parties.
Three matters addressed by the proposed Green Guides not included in the current guidelines are: 1) when marketers must qualify the terms “made with renewable materials;” 2) when marketers must qualify “made with renewable energy” (no such claims are to be made if any part of the product was derived from fossil fuels); and 3) how marketers must support claims that the product or producer provides “carbon offsets” (i.e. product or producer does something to offset the carbon emissions that went into or are caused by the product, such as planting a tree or purchasing carbon credit). Much to the chagrin of some green activists, the proposal doesn’t touch upon claims involving reduced or greener packaging and also don’t attempt to define or suggest limitations on the terms “sustainable” or “sustainability.”
Whenever government speaks out on how companies may promote their products, especially to this level of specificity, concerns of intrusions on commercial free speech rights must be considered. The Green Guides do not constitute binding rules or regulations, but FTC will expect marketers to utilize them when designing advertisements, and will undoubtedly refer to them when bringing enforcement actions under Section 5 of the Federal Trade Commission Act.
Businesses and others who believe that the free flow of commercial information is essential to a vigorous free enterprise system should take the opportunity to comment on the FTC’s proposed Green Guides. The Commission will be receiving comments until December 10.