The FTC and Environmental Marketing Claims: An Overview for the Toy Industry

Transcription

1 The FTC and Environmental Marketing Claims: An Overview for the Toy Industry Presented to the toy industry by staff of the U.S. Federal Trade Commission April 21, 2010

2 Welcome and Overview

3 Presenters Elizabeth Borrelli Vice President, Corporate Social Responsibility and Issues Management Toy Industry Association Elizabeth Borrelli is responsible for facilitating the work of the Association s Environmental Sustainability, Responsible Marketing to Children, and International Trade Committees and for providing leadership, strategy, and counsel to TIA staff and members on these and other issues including toy safety compliance and factory labor practices. Laura Koss Senior Attorney, Division of Enforcement, Bureau of Consumer Protection Federal Trade Commission In addition to her work on the Green Guides, Ms. Koss has worked on a variety of matters, including investigations involving the advertising and promotion of dietary supplement products and country-of-origin claims. Prior to working at the FTC, Ms. Koss was an Associate at Crowell & Moring in Washington, DC; she holds a bachelor s degree from Cornell University and a J.D. from Harvard Law School. Slide 3

4 Situation Analysis Play is essential to healthy child development and toys are integral to play. Accordingly, it is appropriate to make children, parents and caregivers aware of the availability and benefits of specific toys using marketing techniques, provided this is carried out in a responsible manner. International Council of Toy Industries (ICTI) Guiding Principles for Advertising and Marketing Communications to Children March 20, Slide 4

5 Today s Presentation To commemorate Earth Day 2010, TIA has invited the U.S. Federal Trade Commission to discuss the Do s and Don ts of Environmental Marketing Promotion of green attributes of products and services is a rapidly growing component of environmental marketing The FTC plays an important role in helping to ensure that these environmental advertisements are truthful, substantiated and not confusing to consumers Slide 5

6 What you will learn Webinar participants will receive an overview of the FTC and its role in helping marketers avoid making unfair or deceptive environmental claims The discussion will include an introduction to: General Principles of Advertising Law: Claims and Substantiation Guides for the Use of Environmental Marketing Claims, also known as the Green Guides Emerging Environmental Advertising Issues A question and answer session will help participants gain a better understanding of the appropriate approach to green marketing Slide 6

7 The FTC and Advertising Law Laura Koss

8 Who is the FTC? Independent federal agency Protecting consumers from false or misleading advertising claims Promulgate guides to help marketers steer clear of false, misleading ad claims Guides for the Use of Environmental Marketing Claims (Green Guides) Issued in 1992 Currently under review Bring enforcement actions against companies who violate the law Slide 8

9 Today s Presentation FTC and Advertising Law FTC s Green Guides FTC s Recent Actions FTC s Review of the Green Guides Slide 9

10 Federal Trade Commission (FTC) Act Tell the truth Have substantiation Slide 10

11 Ask: What claims does my ad convey to reasonable consumers? Do I have competent and reliable evidence to back up the claims? Competent and reliable scientific evidence = Tests, analysis, research, or other evidence based on the expertise of professional in the relevant area, using procedures generally accepted in the profession to yield accurate and reliable results. Slide 11

12 The FTC s Green Guides Laura Koss

13 FTC s Green Guides Do Apply to all forms of marketing claims Apply to business to consumer and business to business claims Don t Set performance standards or eco-labels Green Guides 16 C.F.R. Part Slide 13

14 General Principles Consumer perception of claims controls Use specific claims Don t overstate product attributes Use clear and prominent qualifications Slide 14

15 Types of Marketing Claims General environmental benefits Degradable and biodegradable Compostable Recyclable Recycled content Slide 15

16 General Environmental Claims Eco Friendly Brand Name Water Eco Friendly General claims may be confusing Better to identify specific green attributes Slide 16

17 General Environmental Claims Example of a recent action Slide 17

18 Bamboo Fiber Textiles Actually are rayon Manufacturing process uses toxic chemicals and releases hazardous air pollutants Doesn t retain the natural attributes of the bamboo plant (such as anti-microbial properties) Slide 18

19 Biodegradable Unqualified biodegradable claims okay if scientific evidence substantiates that the product will completely decompose: 1. within a reasonably short period of time 2. under customary methods of disposal Slide 19

20 Biodegradable? Approximately 91% of total municipal solid waste in the U.S. is disposed of in either landfills, incinerators, or recycling facilities. Products disposed of in landfills, incinerators, or recycling facilities will not biodegrade (i.e., decompose into elements found in nature) within a reasonably short time Slide 20

21 Recyclable Do recycling facilities exist for your product? Use disclosures to qualify claims Slide 21

22 Recycled Content Recovered or diverted from solid waste stream Qualify claim if only partially made of recycled material Slide 22

23 Symbols Unqualified symbol means recycled content and recyclable Use disclosures to qualify claim Slide 23

24 Symbols Slide 24

25 Seals and Third Party Certifications Seals May imply superiority May need to qualify claim Explain basis for award Certifications Independent, with expertise Certification does not insulate advertiser Avoid broad claims Earth Smart Certified Earth Smart Slide 25

26 The FTC s Recent Actions Laura Koss

27 Recent Actions June 2009 Kmart Corporation Dyna-E International Tender Corporation FTC alleged biodegradable claims were false Slide 27

28 Kmart Corporation Slide 28

29 Dyna-E Corporation Slide 29

30 American Enviro Products, Inc. (1992) Slide 30

31 The FTC s Review of the Green Guides Laura Koss

32 Green Guides Review Federal Register Notices Seeking comments on the Guides and new green claims Public Meetings on Emerging Issues Carbon Offsets and Renewable Energy Certificates (RECs) Green Packaging Claims Green Buildings and Textiles Consumer Perception Research Slide 32

33 Carbon Offsets and Renewable Energy Certificates (RECs) Consumer interpretation of: Claims made to sell offsets or RECs Claims made to sell other products (e.g., made with renewable energy ) Double Counting Timing Additionality Slide 33

34 Packaging/Textiles/Building Revisiting claims covered under Guides (recyclable, etc.) Considering whether the FTC should provide guidance on: Life Cycle Analysis Sustainable Claims Renewable Claims Organic Claims Slide 34

35 More Information Green Guides 16 C.F.R. Part Slide 35

36 Questions and Answers

37 Thank you for participating! For more TIA educational programs, visit webinars.toyassociation.org