FOR RELEASE: JULY 28, 1992
FTC CHAIRMAN STEIGER ANNOUNCES NATIONAL GUIDELINES TO PREVENT MISLEADING ENVIRONMENTAL MARKETING CLAIMS
The Federal Trade Commission today issued guidelines to help reduce consumer confusion and prevent the false or misleading use of environmental terms such as "recyclable," "degradable," and "environmentally friendly" in the advertising and labeling of products in the marketplace.
In announcing the guides at a Congressional hearing in Washington, D.C. this morning, FTC Chairman Janet D. Steiger said, "Our goal is to protect consumers and to bolster their confidence in environmental claims, and to reduce manufacturers' uncertainty about which claims might lead to FTC law-enforcement actions, thereby encouraging marketers to produce and promote products that are less harmful to the environment. I believe these guides, together with continued vigorous law enforcement by the FTC and the states, go a long way toward achieving these goals."
Steiger noted the extensive cooperation, expertise and support received from the U.S. Environmental Protection Agency in the guidelines project. EPA Administrator William K. Reilly expressed strong support for the FTC's decision today: "The Federal Task Force on labeling composed of EPA, FTC and the U.S. Office of Consumer Affairs has worked closely on the issue of environmental marketing. A primary goal of the Task Force has been to promote clear federal guidance to those who wish to make environmental claims. The FTC has today made a very significant contribution to that goal. The guidelines will help provide environmentally conscious consumers with more reliable information, ensuring the use of accurate, specific claims and discouraging those that are vague, trivial and overstated. We will see further environmental benefits as consumers use the formidable power of the marketplace to help achieve environmental goals. We applaud the FTC's decision today and are pleased we could assist the FTC in its efforts."
Ann Windham Wallace, Director of the U.S. Office of Consumer Affairs (USOCA), said, "Surveys show consumers are concerned about environmental issues. We are pleased the FTC has taken these concerns into account in developing its voluntary environmental
- more - Green Guides--07/28/92)
marketing guides. We believe the guides will help consumers understand the basis for claims marketers may make, as well as enable consumers to make comparisons and choices based on criteria they believe is important."
The FTC received petitions to issue environmental guides from a number of industry members and trade associations. In addition, a task force of state Attorneys General recommended that the federal government issue uniform standards. The Commission also held two days of public hearings on whether the FTC should augment its case-by-case law enforcement with national guidelines. (The Commission has brought eight such law-enforcement actions in the last two years.) The vast majority of comments received from consumer and industry groups, environmental organizations, state and local governments, USOCA, and the EPA, supported the issuance of FTC guidelines.
A summary of the Environmental Marketing Guides immediately follows this news release. Generally, the guides focus on how consumers are likely to interpret various environmental claims, and identify types of claims that should be explained or qualified to avoid deceiving consumers. For example, broad environmental benefit claims, claims about benefits that will not occur if the product is disposed of in the customary way, or claims where it is not clear whether the benefit applies to the product or its pac- kaging, should be explained or qualified, according to the FTC guides. Otherwise, marketers must be able to substantiate whatever interpretation reasonable consumers draw from those claims. The guides also illustrate the types of qualifications that can be made to avoid consumer deception.
The guides do not rigidly define environmental terms. Instead, through specific guidance and a series of examples of both accep- table and deceptive claims, the guides set out the different meanings that might be conveyed by the use or omission of parti- cular language describing environmental features. The types of claims addressed by the guides include recyclable, degradable, compostable, recycled content, source reduction, refillable, and ozone safe.
The guides will be published in the Federal Register shortly. The guides are not, themselves, legally enforceable. They repre- sent administrative interpretations of laws administered by the Commission to guide marketers in conforming with legal require- ments. The guides do not preempt state or local laws or regula- tions. The Commission will request comments on how the guides are working after three years.
The Commission has prepared an environmental assessment of the guidelines, available to the public for review and comment for 30 days, until Aug. 27. The assessment concludes that an Environ- mental Impact Statement is not necessary because the guides them- selves will not result in a "significant impact on the environment" (Green Guides--07/28/92)
under the applicable law. Comments should be addressed to the FTC, Office of the Secretary, 6th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580.
The Commission vote to issue the guidelines was 4-1, with Com- missioner Mary L. Azcuenaga dissenting. In her dissenting state- ment, Commissioner Azcuenaga said, "As I read the law, the Commis- sion has no authority to issue these guides, as written, without first employing [certain] rulemaking procedures . . . which it has not done." She believes that such procedures are necessary because the guides go beyond interpreting existing cases and poli- cies and, in fact, constitute binding regulations. Commissioner Azcuenaga also said that she differs from the Commission in its decision not to place the guides on the public record for a short period of time to enable the public to comment on them.
Copies of the guidelines, the environmental assessment, Com- missioner Azcuenaga's dissenting statement, and news releases on FTC cases in the green marketing area, are available from the FTC's Public Reference Branch, Room 130, at the above address; 202-326- 2222; TTY 1-866-653-4261.
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MEDIA CONTACT: Bonnie Jansen, Office of Public Affairs 202-326-2161
STAFF CONTACT: Mary Koelbel Engle, Bureau of Consumer Protection, 202-326-3161
SUMMARY OF FTC ENVIRONMENTAL MARKETING GUIDELINES
The Federal Trade Commission's Guides for the Use of Environ- mental Marketing Claims are based on a review of data obtained during FTC law-enforcement investigations, from two days of hearings the FTC held in July 1991, and from more than 100 written comments received from the public. Like all FTC guides, they are administrative inter- pretations of laws administered by the FTC. Thus, while they are not themselves legally enforceable, they provide guidance to marketers in conforming with legal requirements. The guides apply to advertising, labeling and other forms of marketing to consumers. They do not preempt state or local laws or regulations.
The Commission will seek public comment on whether to modify the guides after three years. In the meantime, interested parties may petition the Commission to amend the guides.
Basically, the guides describe various claims, note those that should be avoided because they are likely to be misleading, and illus- trate the kinds of qualifying statements that may have to be added to other claims to avoid consumer deception. The claims are followed by examples that illustrate the points. The guides outline principles that apply to all environmental claims, and address the use of eight commonly-used environmental marketing claims.
As for any advertising claim, the FTC guides specify that any time marketers make objective environmental claims -- whether explicit or implied -- they must be substantiated by competent and reliable evidence. In the case of environmental claims, that evidence often will have to be competent and reliable scientific evidence.
The guides outline four other general concerns that apply to all environmental claims. These are:
(1) Qualifications and disclosures should be sufficiently clear and prominent to prevent deception.
(2) Environmental claims should make clear whether they apply to the product, the package, or a component of either. Claims need not be qualified with regard to minor, incidental components of the product or package.
Summary of FTC Environmental Marketing Guidelines)
(3) Environmental claims should not overstate the environmental attribute or benefit. Marketers should avoid implying a sig- nificant environmental benefit where the benefit is, in fact, negligible.
(4) A claim comparing the environmental attributes of one product with those of another product should make the basis for the comparison sufficiently clear and should be substantiated.
The guides then discuss particular environmental marketing claims. In most cases, each discussion is followed in the guides by a series of examples to illustrate how the principles apply to specific claims.
General environmental benefit claims. In general, unqualified general environmental claims are difficult to interpret, and may have a wide range of meanings to consumers. Every express and material implied claim conveyed to consumers about an objective quality should be substantiated. Unless they can be substantiated, broad environ- mental claims should be avoided or qualified.
Degradable, Biodegradable, and Photodegradable. In general, unqualified degradability claims should be substantiated by evidence that the product will completely break down and return to nature, that is, decompose into elements found in nature within a reasonably short period of time after consumers dispose of it in the customary way. Such claims should be qualified to the extent necessary to avoid consumer deception about: (a) the product or package's ability to degrade in the environment where it is customarily disposed; and (b) the extent and rate of degradation.
Compostable. In general, unqualified compostable claims should be substantiated by evidence that all the materials in the product or package will break down into, or otherwise become part of, usable compost (e.g., soil-conditioning material, mulch) in a safe and timely manner in an appropriate composting program or facility, or in a home compost pile or device. Compostable claims should be qualified to the extent necessary to avoid consumer deception: (1) if municipal com- posting facilities are not available to a substantial majority of consumers or communities where the product is sold; (2) if the claim misleads consumers about the environmental benefit provided when the product is disposed of in a landfill; or (3) if consumers misunder- stand the claim to mean that the package can be safely composted in their home compost pile or device, when in fact it cannot.
Recyclable. In general, a product or package should not be mar- keted as recyclable unless it can be collected, separated, or other- wise recovered from the solid waste stream for use in the form of raw materials in the manufacture or assembly of a new product or package. Unqualified recyclable claims may be made if the entire product or package, excluding incidental components, is recyclable. (Summary of FTC Environmental Marketing Guidelines)
Claims about products with both recyclable and non-recyclable components should be adequately qualified. If incidental components significantly limit the ability to recycle product, the claim would be deceptive. If, because of its size or shape, a product is not accep- ted in recycling programs, it should not be marketed as recyclable. Qualification may be necessary to avoid consumer deception about the limited availability of recycling programs and collection sites if recycling collection sites are not available to a substantial majority of consumers or communities.
Recycled Content. In general, claims of recycled content should only be made for materials that have been recovered or diverted from the solid waste stream, either during the manufacturing process (pre- consumer) or after consumer waste (post-consumer). An advertiser should be able to substantiate that pre-consumer content would other- wise have entered the solid waste stream. Distinctions made between pre- and post-consumer content should be substantiated. Unqualified claims may be made if the entire product or package, excluding minor, incidental components, is made from recycled material. Products or packages only partially made of recycled material should be qualified to indicate the amount, by weight, in the finished product or package.
Source Reduction. In general, claims that a product or package has been reduced or is lower in weight, volume, or toxicity should be qualified to the extent necessary to avoid consumer deception about the amount of reduction and the basis for any comparison asserted.
Refillable. In general, an unqualified refillable claim should not be asserted unless a system is provided for: (1) the collection and return of the package for refill; or (2) the later refill of the package by consumers with product subsequently sold in another pac- kage. The claim should not be made if it is up to consumers to find ways to refill the package.
Ozone Safe and Ozone Friendly. In general, a product should not be advertised as "ozone safe," "ozone friendly," or as not containing CFCs if the product contains any ozone-depleting chemical. Claims about the reduction of a product's ozone-depletion potential may be made if adequately substantiated.
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