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FTC Advises Against General Eco-Friendly Claims

To paraphrase Kermit, it may get even harder being
green, or at least promoting oneself as green.

The Federal Trade Commission Wednesday advised
marketers not to make blanket claims that a product is "environmentally
friendly" or "eco-friendly" because they are "nearly impossible
to substantiate" and are likely to suggest "specific
and far-reaching" environmental benefits that few, if any, of them have.

It also advised them not to use unqualified seals
of approval or certifications because those, again, suggest general
benefit claims.

If marketers make claims that something is
"degradable" or "compostable," the product should decompose
within a year, and if a renewable energy claim is made, fossil fuels should not
power any of the manufacturing process. It made a similar proposal about claims
for renewable materials.

The FTC advises that any claims about
carbon offsets should be ones that occur within two years and ones not already
mandated by government. It is also proposing some changes to guidelines on
"ozone-friendly," "recyclable" and "free-of" and
"nontoxic" claims.

Those were among the FTC's proposed changes
to its guidelines on environmental marketing claims
unveiled Wednesday.

The commission is seeking comment on those
and other proposals through Dec. 10, when it will vote on what changes to make.

Among the questions it seeks answer on are:

"How should marketers qualify "made with
renewable materials" claims, if at all, to avoid deception?

"Should the FTC provide guidance concerning
how long consumers think it will take a liquid substance to completely

"How do consumers understand ‘carbon offset'
and ‘carbon neutral' claims? Is there any evidence of consumer confusion
concerning the use of these claims?"

The guidelines advise marketers on what
"green marketing" claims the commission may find are unfair or

The FTC has limited rulemaking power, so the
guides are to give marketers fair warning about what the FTC may sue them for
as an unfair or deceptive practice. For a summary of the proposed
additions/changes, click here.

The guides outline general principles, give the
FTC's take on how consumers could be expected to interpret various claims,
and provide guidance on how advertisers can qualify or support their claims to
make sure they pass muster.

The FTC has been working on updating the
guidelines for several years now. In June 2009, FTC Chairman Jon Leibowitz testified
before Congress about a "virtual tsunami" of environmental marketing.

The FTC's so-called "Green Guides" were
last updated in 1998. They were not scheduled for review until 2009, but the
commission decided to start in 2007, citing the rise in "green"
marketing that Leibowitz referenced. It is also
looking to add advice on claims that were not common in 1998, when the
guidelines were last revised.

Ad agencies have been cautioning the commission
not to take any steps that would "stifle the ability or the interest
of a company to make positive steps in improving the environment or that would
restrict a company's ability to market and communicate its
activities in this area."

Leibowitz, who also invoked Kermit in a press
conference on the changes, said the goal was actually to make it easier
for companies to be green by clarifying what claims they could make, and that
the changes were in part a response to industry's desire
for more clarity. He said he expects a lot of voluntary compliance.
"Companies want that," he said.

In response to a question from B&C, Leibowitz said the FTC's goal
is for the guidelines to be in place by first-quarter 2011.

FTC Commissioner Julie Brill said that in addition
to clarifications, the three additions to the guidelines are on renewable
materials, renewable energy and carbon offsets, all new claims since the last
time the guidelines were updated.

FTC has brought seven cases in the last year on
biodegradable claims.