The Federal Trade Commission (FTC) has released its years-in-the-making update of the Green Guides, which are intended to ensure that environmental claims about products are accurate and not deceptive. In a teleconference on the release, FTC Chair Jon Liebowitz said the revisions were the result of a “herculean effort” by the agency that will result in a “win-win” for consumers and producers.” The draft guidelines were first announced two years ago and went through an extensive comment and consultation period. While the Green Guides are not regulations that carry the force of law, the FTC can use its authority under Section 5 of the FTC Act to bring enforcement actions against marketers who make claims inconsistent with the guides.
The original Green Guides were issued in 1992 and revised in 1996 and 1998. With the proliferation of environmental claims since the last revision, the update has been long overdue. The FTC says it took as much time as it did because the subject is complicated and the agency wanted to “get it right.” The overarching themes of the Green Guides remain avoidance of broad, unqualified general environmental benefit claims, and qualifying in clear, prominent and understandable language with specific environmental benefits.
The FTC’s website has several explanatory publications, including a four-page summary of the major provisions. Revisions of existing sections include further guidance on not making claims of “environmentally friendly” or “eco-friendly,” not making unqualified claims that a product is degradable, cautioning that items that will be sent to a landfill or incinerator and will not degrade within a year are not degradable, and clarifying guidance on compostable, ozone, recyclable, recycled content and source reduction claims.
In addition, the Green Guides now have new sections on:
- Certifications and seals of approval:
- because certifications and seals may be endorsements, the FTC Endorsement Guides should be followed;
- marketers should disclose any material connections with the certifying organization;
- the basis for the certification or seal should be clearly conveyed to avoid making claims of general environmental benefits;
- Carbon offsets:
- competent and reliable scientific and accounting methods should be used to properly quantify claimed emission reductions and ensure that the same reduction is not sold more than once;
- specifies that it is deceptive to represent than an offset is for emission reductions that will not occur for two years or more;
- specifies that it is deceptive to claim an offset resulted in emission reduction that was required by law;
- “free-of” claims:
- a claim that a product is free-of a substance can be deceptive if it contains or uses substances that pose the same or similar environmental risks as the free-of substance or the free-of substance has not been associated with the product category,
- but a claim is not deceptive if the substance is present in a trace or background amount, does not cause material harm that typically is associated with the product and has not been added intentionally to the product;
- “non-toxic” claims: marketers should have competent and reliable scientific evidence that the product is non-toxic for humans and the environment or should clearly and prominently display qualifications to make the statement not deceptive;
- “made with renewable energy” claims:
- it is deceptive to make an unqualified renewable energy claim if fossil fuel or electricity derived from fossil fuel is used to make any part of the advertised item or to power any part of the advertised service, unless the marketer has matched the non-renewable energy use with renewable energy certificates;
- unless a marketer has substantiation for all their express and reasonably implied claims, they should clearly and prominently qualify the renewable energy claims to avoid deception; and
- “made with renewable materials” claims: marketers should identify the material used and explain why it is renewable and qualify any claim unless the product or package is made entirely with renewable materials.
The Green Guides updates do not attempt to provide advice about what constitutes appropriate use of the terms ”sustainable” and “natural.” The FTC says it lacks sufficient evidence on which to base general guidance on these terms, but in the release conference call the FTC noted that this does not mean marketers can make claims of “sustainable” or “natural” with impunity and could be subject to Section 5 enforcement action.