FTC Finalizes ‘Rules of the Road’ for Environmental Marketers in Update to Green Guides

The Federal Trade Commission (FTC) has finalized the latest version of the Guides for the Use of Environmental Marketing Claims (Green Guides). Effective October 11, 2012, the Green Guides provide marketers with insight regarding when environmental marketing claims are unfair or deceptive and therefore subject to enforcement under Section 5 of the Federal Trade Commission Act (FTC Act), 15 U.S.C. 45.  With the new Green Guides, the FTC is aiming to strengthen, add specificity to, and enhance the FTC’s guidance on making general environmental benefit claims.

Purpose of the Green Guides and the FTC Enforcement Strategy

The FTC first promulgated the Green Guides in 1992 as a means of helping marketers and businesses avoid making environmental marketing claims that are unfair or deceptive under Section 5 of the Federal Trade Commission Act (“FTC Act”), 15 U.S.C. 45.  While the Green Guides are administrative interpretations of the law and are not independently enforceable, the FTC will likely use the Green Guides as a set of standards to inform what is considered unfair or deceptive marketing and therefore subject to enforcement. The Green Guides address claims about the environmental attributes of a product, package, or service in connection with the marketing, offering for sale, or sale of such item or service to individuals.  In the new Green Guides, the FTC has made clear that its guidance is also applicable to claims made during “business-to-business” transactions.

In a 2009 congressional hearing, James A. Kohm, Associate Director of the Enforcement Division in the Bureau of Consumer Protection at the FTC, declared that the latest revisions of the Green Guides would be the first step in the Commission’s “multi-tiered approach” to combat what he referred to as a “tsunami of environmental marketing” that developed over the past decade.  According Associate Director Kohm’s prepared statement, the Commission planned on first, promulgating new rules and guides to make the “rules of the road” clear for businesses; second, directly challenging fraudulent and deceptive advertising through enforcement actions; and third, by informing consumers.

The 2012 Revision of the Green Guides

The new Green Guides include guidance on a number of specific claims that could be made by marketers.  Some claims addressed in the new Green Guides simply were not as prevalent when the guidance was last revised in 1998, such as claims related to carbon offsets, claims made regarding renewable energy, and sustainable or organic / natural claims.