FTC Issues Warning Letters About Environmental Seals and Certifications
Click here for a PDF of this news alert.
On September 14, 2015, the U.S. Federal Trade Commission (FTC) announced that it had issued warning letters to five providers of environmental certification seals and 32 companies using those seals, stating that use of the seals may not conform to FTC’s environmental marketing guidelines, known as the Green Guides. Although FTC did not explain the basis for its concerns, the warning letters published on the commission’s website suggest that the relevant seals may improperly suggest that products earning the seal have specific and far-reaching environmental benefits. FTC updated its Green Guides in October 2012 and since then has initiated seven sets of enforcement actions against a total of 15 companies. See, e.g., our January 24, 2014 client alert “FTC Continues Crackdown on Improper Environmental Marketing Claims.”
Background – Green Guides
The refreshed Green Guides contain a new section on environmental certifications and seals of approval. 16 C.F.R. § 260.6. The Green Guides state that if an environmental certification or seal does not clearly convey the basis for the certification in the name or logo, it should be accompanied by clear and prominent language conveying the basis for awarding the certification or seal. For example, a seal or certification awarded on the basis of biodegradability, recyclability, and compostability could be accompanied by the words “Biodegradable/Recyclable/Compostable.” See this example on FTC’s website. If the attributes upon which the certification or seal are awarded are too numerous to list, FTC suggests that marketers can use qualifying language such as “Virtually all products impact the environment. For details on which attributes we evaluated, go to [website discussing the product].”
Furthermore, the Green Guides emphasize that certifications and seals may be considered endorsements that are subject to the FTC’s Endorsement Guides, 16 C.F.R. Part 255, and caution marketers that they must disclose any material connection between the marketer and the certifying body that might affect the weight or credibility of an endorsement, unless the seal or certification does not convey that the certifier is independent.
FTC Warning Letters
FTC has published the form letters it sent to the providers and users of the potentially improper seals, but it says that it will not disclose the identities of the recipients. The letters direct the recipients to advise FTC about the actions the recipient is taking to ensure that the seals are used in compliance with the Green Guides.
Beveridge & Diamond actively counsels clients on environmental marketing. For further information on this topic, please contact the authors.