Guides for the Use of Environmental Marketing Claims

Federal RegisterOct 15, 2010

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FEDERAL TRADE COMMISSION

16 CFR Part 260

Guides for the Use of Environmental Marketing Claims

AGENCY:

Federal Trade Commission.

ACTION:

Proposed revisions to guidelines.

SUMMARY:

The Federal Trade Commission (“FTC” or “Commission”) conducted a comprehensive review of its Guides for the Use of Environmental Marketing Claims (“Green Guides” or “Guides”) and proposes retaining the Guides. After reviewing the public comments, the transcripts of three public workshops that explored emerging issues, and the results of its consumer perception research, the Commission proposes several modifications and additions to the Guides. These proposed revisions aim to respond to changes in the marketplace and help marketers avoid making unfair or deceptive environmental marketing claims. The Commission seeks comment on these proposed revisions and other issues raised in this document.

DATES:

Comments must be received on or before December 10, 2010.

ADDRESSES:

Interested parties are invited to submit written comments electronically or in paper form, by following the instructions in the Request for Comment part of the SUPPLEMENTARY INFORMATION section below. Comments in electronic form should be submitted at (

https://ftcpublic.commentworks.com/ftc/revisedgreenguides

) (and following the instructions on the web-based form). Comments in paper form should be mailed or delivered to the following address: Federal Trade Commission, Office of the Secretary, Room H-135 (Annex J), 600 Pennsylvania Avenue, NW, Washington, DC 20580, in the manner detailed in the Request for Comment part of the SUPPLEMENTARY INFORMATION section below.

FOR FURTHER INFORMATION CONTACT:

Laura Koss, Attorney, Division of Enforcement, Bureau of Consumer Protection, Federal Trade Commission, 202-326-2890.

SUPPLEMENTARY INFORMATION:

I. Overview

Environmental marketing claims are useful sources of information for consumers, but only when they are true. Ensuring that such claims are truthful is particularly important because consumers often cannot determine for themselves whether a product, package, or service actually possesses the advertised environmental attribute. Because there is a potential for consumer confusion about environmental claims, guidance from the FTC can benefit both businesses and consumers alike.

To help marketers make truthful and substantiated environmental claims, the Federal Trade Commission issued the Guides for the Use of Environmental Marketing Claims (“Green Guides” or “Guides”) in 1992, and revised them in 1996 and 1998. The Guides help marketers avoid making deceptive claims by outlining general principles that apply to all environmental marketing claims and providing specific guidance about how reasonable consumers are likely to interpret particular claims, how marketers can substantiate them, and how they can qualify those claims to avoid consumer deception.

Periodic review ensures that the Guides keep pace with evolving consumer perceptions and new environmental claims. Since the FTC last revised them in 1998, the marketplace has been dynamic. As consumers have become increasingly concerned about the environmental impact of the products and services they use, marketers have expanded their promotion of the environmental attributes of their products and services. Some of these promotions have prompted enforcement action by the FTC, including cases challenging certain environmental benefit claims as false, such as “degradable” paper products or so-called “bamboo” textiles that are made with an “eco-friendly manufacturing process.” And, an increasing number of environmental claims are new or were not common when the Guides were last reviewed and, therefore, are not addressed by the current Guides. Thus, beginning in 2007, the FTC sought public comments on the continuing effectiveness of the Guides, held public workshops on emerging green marketing issues, and conducted research on consumer perception of environmental claims. This review affirms that the Guides have benefitted consumers and businesses but suggests that the Guides should be updated.

The FTC, therefore, proposes several revisions to the Guides. Many of these revisions strengthen, add specificity to, or enhance the accessibility of the current guidance on general “green” claims and environmental seals, and claims such as compostable, degradable, and recyclable. Others propose new guidance regarding emerging claims not currently addressed in the Guides, such as renewable materials, renewable energy, and carbon-offsets. The FTC also proposes non-substantive changes throughout the Guides to make them easier to read and use, including simplifying language and reorganizing sections to make information easier to find. The FTC is now seeking further public comment on each of these proposed modifications to the Guides.

First, the FTC proposes strengthening its guidance regarding general environmental benefit claims. The FTC’s consumer perception study confirms what the current Guides already state — unqualified claims that an item is “environmentally friendly” or “eco-friendly” are likely to convey that it has specific and far-reaching environmental benefits. Very few products, if any, have all of the attributes consumers seem to perceive from such claims. Therefore, these claims may be impossible to substantiate. Accordingly, the proposed guidance cautions marketers not to make unqualified general claims. Our study indicates, however, that marketers may be able to effectively qualify these claims to focus consumers on the specific environmental benefits that marketers could substantiate. Therefore, the proposed revised Guides provide more prominent guidance on how to adequately qualify general environmental claims.

Similarly, the proposed revised Guides include a new section devoted to certifications and seals of approval, which currently are addressed in a single example. The proposed new section gives more prominence to the current Guides’ admonition that unqualified seals of approval and certifications likely constitute general environmental benefit claims. It also more directly cautions marketers not to use unqualified certifications or seals, i.e., certifications or seals that do not state the basis for the certification. The proposed section further advises marketers that qualifications should be clear and prominent and should convey that the certification or seal of approval refers only to specific and limited benefits. Moreover, this new section emphasizes that certifications and seals of approval constitute endorsements covered by the FTC’s Endorsement Guides and includes examples explaining how those Guides apply to environmental claims.

The proposed revised Guides also suggest clarification for claims that a product is degradable, compostable, or “free of” a particular substance, and highlight guidance for recyclable claims. If a marketer claims, in certain cases, that a product is “degradable,” it should

decompose in a “reasonably short period of time” — no more than one year. Moreover, if a solid product is destined for a landfill, an incinerator, or a recycling facility, the marketer should not make unqualified degradable claims because the product will not degrade within a year. Similarly, when making an unqualified “compostable” claim, a marketer should be able to show that the product will break down into usable compost in a safe and timely manner — approximately the same time as the materials with which it is composted. The proposed Guides also clarify and expand guidance about claims that products are “free of” particular materials. Finally, the proposed Guides highlight advice in the current guides that the use of “recyclable” depends on how many consumers and communities have access to recycling facilities for the advertised product.

The proposed revised Guides also include new sections for claims not addressed by the current Guides, such as claims about the use of “renewable materials” and “renewable energy” The FTC’s consumer perception research suggests that these claims may be misleading because consumers interpret them differently than marketers intend. The proposed new sections advise marketers to provide context for these claims, in the form of specific information about the materials and energy used. Because the FTC’s study did not test the effect of qualifying these claims, however, the FTC specifically seeks comment on whether providing this, or other information, would reduce consumer confusion. The proposed revised Guides also provide advice about “carbon offset” claims: marketers should disclose if the offset purchase funds emission reductions that will not occur within 2 years, should make sure that they do not double count offsets, and should not advertise an offset if the activity that produces the offset is already required by law.

Environmental marketing presents complex, challenging issues. Despite the voluminous record established by this review, the FTC would benefit from additional input in many areas, including for the claims discussed above and also for “organic” and “made with recycled content” claims. Therefore, the FTC invites comment on all aspects of the proposed revised Guides, as well as on the specific questions it poses in this Notice. The FTC will take all suggestions into account as it works to finalize the revised Guides.

II. Background

A. The Green Guides

The Commission issued the Green Guides, 16 CFR Part 260, to help marketers avoid making environmental claims that are unfair or deceptive under Section 5 of the Federal Trade Commission Act (FTC Act), 15 U.S.C. 45.

Industry guides, such as these, are administrative interpretations of the law. Therefore, they do not have the force and effect of law and are not independently enforceable. The Commission, however, can take action under the FTC Act if a marketer makes an environmental claim inconsistent with the Guides. In any such enforcement action, the Commission must prove that the challenged act or practice is unfair or deceptive.

The Commission issued the Green Guides in 1992 (57 FR 36363 (Aug. 13, 1992)), and subsequently revised them in 1996 (61 FR 53311 (Oct. 11, 1996)) and 1998 (63 FR 24240 (May 1, 1998)). The FTC administers several other environmental and energy-related rules and guides.

See

Guide Concerning Fuel Economy Advertising for New Automobiles (16 CFR Part 259), Appliance Labeling Rule (16 CFR Part 305), Fuel Rating Rule (16 CFR Part 306), Alternative Fuels and Alternative Fueled Vehicles Rule (16 CFR Part 309), Recycled Oil Rule (16 CFR Part 311), and Labeling and Advertising of Home Insulation Rule (16 CFR Part 460).

The Green Guides outline general principles that apply to all environmental marketing claims and provide specific guidance regarding many environmental benefit claims. For each such claim, the Green Guides explain how reasonable consumers are likely to interpret the claim, describe the basic elements necessary to substantiate the claim, and present options for qualifying the claim to avoid deception.

The illustrative qualifications provide guidance for marketers who want assurance about how to make nondeceptive environmental claims, but do not represent the only permissible approaches to qualifying a claim. This guidance assists marketers in making truthful and substantiated statements about the environmental attributes of their products and services.

The Guides, however, do not establish standards for environmental performance or prescribe testing protocols.

In order to adequately substantiate environmental marketing claims, the Guides advise marketers that they will often need “competent and reliable scientific evidence.”

The Guides currently define competent and reliable scientific evidence as “tests, analyses, research, studies or other evidence based on the expertise of professionals in the relevant area, conducted and evaluated in an objective manner by persons qualified to do so, using procedures generally accepted in the profession to yield accurate and reliable results.

Since the last Green Guides review, the Commission has clarified this standard, stating that such evidence “should be sufficient in quality and quantity based on standards generally accepted in the relevant scientific fields, when considered in light of the entire body of relevant and reliable scientific evidence, to substantiate that [a] representation is true.”

16 CFR 260.5.

Id.

See

e.g.

Indoor Tanning Ass’n

, Docket No. C-4290 (May 13, 2010) (consent order);

see also

Dietary Supplements: An Advertising Guide for Industry FTC, Dietary Supplements: An Advertising Guide for Industry (2001),

available at

(

http://www.ftc.gov/bcp/edu/pubs/business/adv/bus09.pdf

) (stating that “the studies relied on by an advertiser would be largely consistent with the surrounding body of evidence”).

B. The Green Guides Review

1. First Request for Public Comment

Citations to comments identify the commenter, the particular

Federal Register

Notice to which the commenter responded (533431- Green Guides Review; 533254 - Carbon Offsets and Renewable Energy Certificates Workshop; 534743 - Green Packaging Workshop; or 536013 - Green Building and Textiles Workshop), and the assigned comment number.

Since the Commission last revised the Green Guides in 1998, both anecdotal evidence and empirical research indicate that consumers have a heightened awareness of environmental concerns and, therefore, place increased importance on buying products and services that will cause less harm to the environment.

Marketers, in turn, have responded by touting the environmental attributes of their products and services. Because of the proliferation of these environmental claims, the Commission began its decennial Guides review on November 26, 2007, one year before scheduled. The Commission’s

November 2007

Federal Register

Notice sought comment on a number of general issues, including the continuing need for and economic impact of the Guides, the effect of the Guides on the accuracy of environmental claims, and whether the Commission should provide guidance on certain environmental claims - such as carbon neutral, sustainable, and renewable - not currently addressed in the Guides.

The Commission received 75 written comments in response.

See

e.g.

, American Chemistry Council (“ACC”), Comment 533431-00023 at 3 (citing a 2005 nationwide survey finding that 90 percent of consumers base their buying decisions, in part, on the effect their choices will have on the environment); Environmental Packaging International (“EPI”), Comment 533431-00063 at 8 (citing studies by the Natural Marketing Institute, Landor Associates, Datamonitor, Organic Consumers Association, and Global Marketing Insite); Saint-Gobain Corporation (“Saint-Gobain”), Comment 533431-00037 at 5-6 (citing studies by Consumers International, American Environics, EcoPinion); Seventh Generation, Comment 533431-00033 at 2 (citing 2007 Cone Consumer Environmental Survey); American Beverage Association (“ABA”), Comment 533431-00066 at 2-3; Dow Chemical Company (“Dow”), Comment 533431-00010 at 1; North American Insulation Manufacturers Association (“NAIMA”), Comment 536013-00017 at 5-6; Procter & Gamble Company (“P&G”), Comment 533431-00070 at 1; The Advertising Trade Associations (“ATA”), Comment 533431-00041 at 7.

72 FR 66091 (Nov. 27, 2007). This review has taken some time because, in order to provide as useful advice as possible, the Commission conducted a consumer perception study of certain environmental marketing claims. The Commission discusses this study in detail below.

2. Workshops and Corresponding Requests for Public Comment

To establish a more robust record, the Commission also held three public workshops to explore emerging environmental marketing claims. Specifically, the workshops addressed carbon offsets and renewable energy certificates;

green packaging claims;

and green building and textiles.

The workshops brought together over 450 people representing industry, government, consumer groups, the academic community, and non-profit environmental organizations.

The Commission requested comment in connection with each workshop

and received an additional 125 written comments.

See

72 FR 66094 (Nov. 27, 2007).

See

73 FR 11371 (Mar. 3, 2008).

See

73 FR 32662 (June 10, 2008).

Citations to workshop transcripts or presentations identify the speaker’s name and organization, the relevant workshop, and either the transcript page or the hyperlink to the speaker’s presentation.

Documents relating to the Green Guides review, including the public comments; workshop agendas, presentations, and transcripts; and the Commission’s consumer perception study are available at (

http://www.ftc.gov/green

The Union of Concerned Scientists submitted a comment containing letters from over 16,000 individuals. Although approximately 1,300 of those letters vary in form, the substance of all the letters is the same. They urged the FTC to review the environmental marketing of corn-based ethanol as a “green” alternative to gasoline. The comments suggested that such marketing is not based on “sound science” because corn ethanol production could cause an increase in the production of global warming pollution over regular gasoline.

3. Consumer Perception Evidence

Because the Guides are based on consumer understanding of environmental claims, consumer perception research can provide the Commission with the best evidence upon which to formulate guidance. The following discusses commenters’ submissions of consumer research and the Commission’s 2009 consumer perception study.

a. Commenters’ Submissions

Although the Notices solicited consumer perception evidence, few commenters submitted such research.

Rather, commenters submitted research concerning: (1) consumers’ attitudes and beliefs about environmental claims;

(2) consumers’ environmental concerns and interests;

and (3) consumers’ behavior regarding environmental claims.

These surveys do not provide a basis upon which the Commission can formulate guidance on how to make truthful and nondeceptive environmental marketing claims. Accordingly, the Commission conducted its own consumer perception study in July and August of 2009.

The Commission discusses the consumer perception research that commenters submitted in the substantive parts of this Notice.

ACC, Comment 536013-00030 at 2 (citing a survey of consumer descriptions of a “green company”); Rick L. Cantrell, Sustainable Forestry Initiative, Inc. (“SFI”), Green Building and Textiles Workshop Presentation at (

http://www.ftc.gov/bcp/workshops/buildingandtextiles/presentations/3rcantrell.pdf

) (citing a survey regarding consumer concerns about “sustainable forestry”); P&G, Comment 533431-00070 at 1 (citing a study of consumer consideration of “sustainability factors” in purchasing decisions); Kelly Tullier, Grocery Manufacturers Association (“GMA”), Green Packaging Workshop Presentation at (

http://www.ftc.gov/bcp/workshops/packaging/presentations/tullier.pdf

) (same); U.S. Green Building Council (“USGBC”), Comment 536013-00029 at 2 (citing a study regarding consumer knowledge of green homebuilding).

John Kalkowski, Packaging Digest (“Packaging Digest”), Green Packaging Workshop Tr. at 22-23 (citing a study concerning consumers’ lack of interest in environmental activities); Patricia F. O’Leary, Cotton Incorporated (“Cotton Incorporated”), Green Building and Textiles Workshop Tr. at 28 (citing a study regarding consumers’ reaction to apparel items that are not “environmentally friendly”); NAIMA, Comment 536013-00027 at 4-5 (citing a study regarding consumers’ concern about global warming); Saint-Gobain, Comment 533431-00037 at 4-5 (same); Seventh Generation, Comment 533431-00033 at 2 (citing studies of consumers’ interest in the environment).

GMA, Green Packaging Workshop Tr. at 111 (citing a survey concerning consumer Internet use to get information about environmental initiatives and products); National Recycling Coalition (“NRC”), Comment 533431-00078 at 2 (discussing its research concerning consumers’ recycling behavior); Sam Rashkin, Environmental Protection Agency, Green Building and Textiles Workshop Tr. at 178-179 (citing a survey concerning consumer awareness of the Energy Star name and logo); Kirsten Ritchie, Gensler (“Gensler”), Green Building and Textiles Workshop Tr. at 109 (same); Timothy Smith, University of Minnesota (“Univ. of Minnesota”), Comment 536013-00004 at 1 (citing a study examining life cycle information in advertising).

b. The Commission’s Consumer Perception Study

To conduct the study, the FTC contracted with Harris Interactive, a consumer research firm with substantial experience surveying consumer communications.

The study sampled members of the contractor’s Internet panel, which consists of more than four million individuals recruited through a variety of convenience sampling procedures.

From this sample, Harris selected individuals who were invited to complete the survey. Participants were selected to correspond, as much as possible, with the known distribution of U.S. adults aged 18 and over in terms of age, gender, race and ethnicity, and geographic region. A total of 3,777 individuals completed the survey.

The Commission’s consumer perception study is available at (

http://www.ftc.gov/green

The sample for this research, therefore, does not necessarily constitute a true, random sample of the adult U.S. population. However, because the study focused primarily on comparing responses across randomly assigned treatment groups, the Internet panel provided an appropriate sample frame.

Additional detail on sample selection is available in the methodology report prepared by Harris which is available at (

http://www.ftc.gov/green

Harris presented participants with several questions aimed at determining how they understand certain environmental claims. The first portion of the study tested the following claims: “green,” “eco-friendly,” “sustainable,” “made with renewable materials,” “made with renewable energy,” and “made with recycled materials.” The questionnaire asked about both unqualified and qualified general environmental benefit claims (

e.g.

, “green” vs. “green - made with recycled materials”), as well as specific-attribute claims alone (

e.g.

, “made with recycled materials”). The study tested these claims against a non-environmental control claim (

e.g.

, “new and improved”). Moreover, to examine whether consumers’ understanding of the claims differed depending on the product being advertised, the study tested the claims as they appeared on three different products - wrapping paper, a laundry basket, and kitchen flooring.

Harris tested 16 different claims with each of the three different products, resulting in a total of 48 product-claim pairs. To avoid skewing an individual’s answers by asking the same person essentially the same set of questions multiple times, and to limit the length of the survey presented to any individual, each participant was

asked questions regarding only two randomly-selected product-claim pairs.

The study results support the current Guides’ approach of providing general, rather than product-specific, guidance because consumers generally viewed the tested claims similarly for the three tested products. Moreover, the results were comparable for respondents who indicated concern and interest in environmental issues and those who did not.

The second portion of the study tested carbon offset and carbon neutral claims. The questionnaire asked half of the participants about carbon offsets and half about carbon neutral claims. An initial screening question gauged whether respondents understood these concepts by asking them to identify what a carbon offset was or what carbon neutral meant. Only those participants who demonstrated a general understanding of these terms continued with the remainder of the study.

Both portions of the study used a combination of open- and closed-ended questions exploring the same topic. The study questionnaire described the claims to participants, rather than presenting an actual advertisement. For example, a participant was asked: “Suppose you see some wrapping paper advertised or labeled as ‘green - made with recycled materials.’”

After the study’s completion, Harris provided FTC staff with data summaries. The results of this study are discussed below in Parts IV.F, V, and VI of this Notice.

The methodology used for this study may not be appropriate for testing consumer perception of a particular advertising claim. Among other differences, marketers must test the claim in the context of a specific advertisement, which was impossible here.

C. Outline of This Notice

After reviewing the public comments, the workshop proceedings, and the consumer perception evidence, the Commission proposes retaining the Green Guides and making several revisions. Part III of this Notice proposes three non-substantive changes to make the Guides easier to read and use. Part IV discusses comments on general issues, such as the continuing need for the Guides and general comments on life cycle analysis. Part V discusses issues relating to specific claims that already are addressed by the Guides. Part VI addresses environmental marketing claims not currently covered by the Guides. Part VII requests public comment on the issues raised in this Notice, including the proposed, revised Green Guides. Finally, Part VIII sets out the proposed, revised Guides.

III. Proposed Non-substantive Changes to the Current Green Guides

The Commission proposes three changes to make the Guides easier to read and use. First, wherever possible, the Commission has simplified the Guides’ language to make it clearer and easier to understand. For example, the FTC has replaced its formal, legal description of the Guides in Section 260.1 with a more reader-friendly version. Similarly, the Commission has removed unnecessary language and redundant examples from all sections of the Guides.

Among other things, the Commission proposes deleting from Section 260.5 a reference to the FTC’s law enforcement actions in the green area and the telephone number to call to obtain copies of those cases. Case information may be found on the Commission’s website, (

http://www.ftc.gov

). In addition, in Section 260.2, the Commission proposes deleting the explicit statement that the Guides apply to “marketing through digital or electronic means.” The Commission added this reference in 1998, when Internet marketing was emerging and online advertisers were uncertain about the Guides’ applicability. Because Internet marketing is now ubiquitous, the Commission proposes revising the Guides to state that they apply to marketing in any medium.

Second, the Commission proposes reorganizing the Guides. Specifically, the proposed, revised Guides combine the first three sections into one section, which discusses the Guides’ purpose, scope, and structure. In addition, the Commission proposes splitting existing Section 260.7 (titled “Environmental Marketing Claims”) into multiple sections. Currently, Section 260.7 provides advice on eight different environmental claims, containing the bulk of the Commission’s guidance. To make the information easier to find, the Commission proposes moving each environmental claim into its own section, organized alphabetically, and dividing the guidance within each section into subparts (

e.g.

, section 260.9(a), 260.9(b), etc.). Because of these organizational changes, the Commission has renumbered each Guide section.

Third, the Commission proposes deleting Sections 260.4 and 260.8. Section 260.4 states that the Commission reviews the Green Guides as part of its ongoing, periodic review program, and explains that parties may petition the Commission to amend the Guides in light of new evidence. This information is common to all of the Commission’s guides, and it is unnecessary to repeat it in each one.

Section 260.8 contains the FTC’s environmental assessment of the Guides pursuant to the National Environmental Policy Act. Because this information is contained in the

Federal Register

Notice that enacted the Guides and is not needed by marketers using the Guides, the Commission proposes deleting it from the Guides’ text.

These deletions will streamline the Guides, making them a more user-friendly document.

Information about petitioning the FTC may be found in the Commission’s rules.

See

e.g.

, 16 CFR 1.6.

As we did when issuing the Guides in 1992 and revising them in 1996 and 1998, the Commission concludes that the proposed revisions to the Guides would not have a significant impact on the environment and any such impact “would be so uncertain that environmental analysis would be based on speculation.” 16 C.F.R. 1.83(a).

IV. General Issues

The Commission sought comment on several general issues, including: (1) whether there is a continuing need for the Guides; (2) whether, and to what degree, industry is complying with the Guides; (3) whether the Commission should modify the Guides due to changes in technology or economic conditions; (4) whether there are international laws or standards the FTC should consider as part of its review; and (5) whether the Guides overlap or conflict with other federal, state, or local laws or regulations. This section discusses the commenters’ responses to these questions, as well as their views on life cycle analysis, and provides the Commission’s analysis of the issues.

A. Continuing Need for the Guides

1. Comments

Several commenters affirmed that the Guides have benefitted consumers by stemming the tide of spurious environmental claims; bolstering consumer confidence; imposing clarity and consistency in environmental marketing claims; and increasing the flow of specific and accurate environmental information to consumers, enabling them to make informed purchasing decisions.

commenters suggested the Guides were no longer needed.

See

e.g.

, ACC, Comment 533431-00023 at 3-4; ATA, Comment 533431-00041 at 3, 9; American Forest & Paper Association (“AF&PA”), Comment 533431-00019 at 2; American Reusable Textile Association, Comment 534743-00038 at 4; Business for Social Responsibility (“BSR”), Comment 533431-00016 at 1; Carbonfund.org, Comment 533431-00056 at 2; Carpet and Rug Institute (“CRI”), Comment 533431-00026 at 3; Consumer Specialty Products Association (“CSPA”), Comment 533431-00049 at 1-2; Dow, Comment 533431-00010 at 3; EHS Strategies, Inc. (“EHS”), Comment 534743-00011 at 1; Fibre Box Association (“FBA”), Comment 533431-00015 at 1; Georgia-Pacific LLC (“Georgia-Pacific”), Comment 533431-00007 at 1-3; Graphic Arts Coalition, Comment 533431-00060 at 1; GreenBlue, Comment 533431-00058 at 1; Rebecca Hammer (“Hammer”), Comment 533431-00017 at 1-2; Alison C. Healey,

et al.

(“Healey”), Comment 533431-00048 at 1; International Paper, Comment 533431-00055 at 1; MeadWestvaco Corporation (“MeadWestvaco”), Comment 533431-00013 at 2; NAIMA, Comment 536013-00042 at 2-3; New York City Department of Consumer Affairs, Comment 533431-00018 at 2; P&G, Comment 533431-00070 at 1; Pratt Industries, Comment 533431-00081 at 1; Lynn Preston (“Preston”), Comment 533431-00021 at 2; Saint-Gobain, Comment 533431-00037 at 2-4; Seventh Generation, Comment 533431-00033 at 7; The Soap and Detergent Association (“SDA”), Comment 533431-00020 at 1, 5; The Society of the Plastics Industry, Inc. (“SPI”), Comment 533431-00036 at 13; U.S. Council for International Business, Comment 533431-00052 at 2; Weyerhaeuser, Comment 533431-00084 at 1.

Several commenters stated that the Guides help those seeking to make truthful and accurate environmental marketing claims, while providing a level playing field that benefits both consumers and compliant companies.

Moreover, many agreed that the Guides accomplish their goals without imposing an undue burden on industry.

See

e.g.

, International Paper, Comment 533431-00055 at 2 (noting that the Guides level the playing field by standardizing terms and requiring factual bases for claims); AF&PA, Comment 533431-00083 at 2; CSPA, Comment 533431-00049 at 1-2; EPI, 533431-00063 at 2; MeadWestvaco, Comment 533431-00013 at 1; NAIMA, Comment 536013-00017 at 2.

See

e.g.

, GreenBlue, Comment 533431-00058 at 3 (stating that the Guides’ assurance of accuracy and specificity actually reduces costs “by providing a more common, consistent framework for communicating product attributes”); AF&PA, Comment 533431-00083 at 2; ATA, Comment 533431-00041 at 7-9; Saint-Gobain, Comment 533431-00037 at 6-7.

2. Analysis

Based on the consensus that the Guides benefit both consumers and businesses, the Commission proposes to retain them. As discussed below, however, the Commission proposes several revisions to ensure that the Guides reflect consumer perception and new claims in the marketplace.

B. Industry Compliance

1. Comments

In response to questions about industry compliance with the Guides, some commenters asserted that deceptive marketing claims have increased in the environmental area.

For example, TerraChoice Environmental Marketing, Inc. reported the results of its 2007 review of over 1,000 products and expressed concern that many marketers are using vague claims, such as “environmentally friendly” and “green,” without defining terms or providing evidence to support their claims.

It also noted that many marketers “highlight relatively insignificant environmental benefits of a product while distracting consumers from much more significant impacts.”

Another commenter observed that companies are marketing the “environmentally friendly” nature of their products “through words or pictures while only minimally (if at all) qualifying such claims.”

In addition, other commenters noted increased instances of “greenwashing” by marketers using a “plethora of buzzwords like sustainable, environmentally friendly, carbon offsets, [and] green.”

Some commenters suggested that bringing more enforcement actions could help address this issue.

See

e.g.

, MeadWestvaco, Comment 533431-00013 at 1 (noting that diligent companies are disadvantaged by those companies that ignore or do not understand the Guides and capitalize on growing interest in environmental issues); Saint-Gobain, Comment 533431-00037 at 3 (commenting that manufacturers continue to make deceptive claims, particularly in insulation and building industries); TerraChoice Environmental Marketing, Inc. (“TerraChoice”), Comment 533431-00040 at 1-4 (stating that the use of false or misleading claims is rampant); GreenBlue, Comment 533431-00058 at 4-6.

But see

ATA, Comment 533431-00041 at 3 (stating that no evidence suggests that consumers are being misled by claims); Georgia-Pacific, Comment 533431-00007 at 5 (commenting that there is a high degree of industry compliance).

TerraChoice, Comment 533431-00040 at 3, 6.

Id.

at 1.

Jim Krenn (“Krenn”), Comment 533431-00014 at 3.

Phil Bailey (“Bailey”), Comment 533431-00028 at 3;

see also

Hammer, 533431-00017 at 4-5; Healey, Comment 533431-00048 at 2-5.

GreenBlue, Comment 533431-00058 at 4; International Paper, Comment 533431-00055 at 3; MeadWestvaco, Comment 533431-00013 at 2; Eric Nguyen, Comment 533431-00009 at 5-6; SDA, Comment 533431-00020 at 5; Seventh Generation, Comment 533431-00033 at 7.

Commenters also expressed concern that the Guides may not be effectively reaching industry because many businesses are unfamiliar with them or do not realize that they apply to business-to-business transactions.

For example, one commenter asserted that the Guides have provided no benefit to the small business community, stating that key players in the printing industry do not know about the Green Guides.

Packaging workshop panelist Environmental Packaging International described a visit to a recent packaging trade show and noted that, in its estimation, 20 percent of the exhibitors were making misleading claims about the environmentally preferable qualities of their packaging.

Joseph Cattaneo, Glass Packaging Institute (“GPI”), Green Packaging Workshop Tr. at 249, 251 (noting that marketers are not paying attention to the Guides when creating their campaigns); ACC, Comment 536013-00030 at 3; Cheryl Baldwin, Green Seal (“Green Seal”), Green Packaging Workshop Tr. at 192; Victor Bell, EPI (“EPI”), Green Packaging Workshop Tr. at 232-233; Michelle Harvey, Environmental Defense Fund (“EDF”), Green Packaging Workshop Tr. at 53; Packaging Digest, Green Packaging Workshop Tr. at 52. The Guides currently state that they apply to any environmental claim made “in connection with the sale, offering for sale or marketing of the product, package, or service . . . for commercial, institutional, or industrial use.” 16 CFR 260.2.

Graphic Arts Coalition, Comment 533431-00060 at 1.

EPI, Green Packaging Workshop Tr. at 232-233.

Panelist NatureWorks LLC echoed this concern, noting that even industry members familiar with the Guides are not aware that they apply to business-to-business transactions.

Workshop panelists, therefore, recommended that the Guides emphasize their application to business-to-business transactions and not just business-to-consumer marketing.

Environmental Packaging International proposed, for instance, that the Guides include specific examples of such business-to-business transactions.

See

Snehal Desai, NatureWorks LLC (“NatureWorks”), Green Packaging Workshop Tr. at 246-247.

See

e.g.

, Scot Case, TerraChoice (“TerraChoice”), Green Packaging Workshop Tr. at 244.

EPI, Green Packaging Workshop Tr. at 252.

2. Analysis

The Guides’ purpose is to help marketers avoid making unfair or deceptive environmental claims. For marketers who nevertheless violate the law, the Commission will continue its enforcement efforts. The Commission brought several recent actions involving false or unsubstantiated environmental claims. For example, last year, the Commission announced three actions charging marketers with making false and unsubstantiated claims that their products were biodegradable.

In addition, the Commission charged four sellers of clothing and other textile products with deceptively labeling and advertising these items as made of bamboo fiber, manufactured using an environmentally friendly process, and/or biodegradable.

Dyna-E Int’l, Inc., et al.

, Docket No. 9336 (Dec. 15, 2009);

Kmart Corp.

, Docket No. C-4263 (July 15, 2009);

Tender Corp.

, Docket No. C-4261 (July 13, 2009). According to the FTC’s complaints, the defendants’ products typically are disposed in landfills, incinerators, or recycling facilities, where it is impossible for waste to biodegrade within a reasonably short time period.

CSE, Inc., et al.

, Docket No. C-4276 (Dec. 15, 2009);

Pure Bamboo, LLC, et al.

, Docket No. C-4274 (Dec. 15, 2009);

Sami Designs, LLC, et al.

, Docket No. C-4275 (Dec. 15, 2009);

The M Group, Inc., et al.

, Docket No. 9340 (Apr. 2, 2010). According to the complaints, these products are made of rayon, manufactured through a process that uses toxic chemicals and releases hazardous air pollutants, and cannot biodegrade within a reasonably short time period. The Commission also brought five enforcement actions related to deceptive energy claims, involving exaggerated claims about home insulation and false claims about fuel-saving devices for motor vehicles.

See United States v. Enviromate, LLC., et al.

, No. 09-CV-00386 (N.D. Ala. Mar. 2, 2009);

United States v. Meyer Enterprises, LLC, et al.

, No. 09-CV-1074 (C.D. Ill. Mar. 2, 2009);

United States v. Edward Sumpolec

, No. 6:09-CV-379-ORL-35 (M.D. Fla. Feb. 26, 2009);

FTC v. Dutchman Enterprises, LLC, et al.

, No. 09-141-FSH (D.N.J. Jan. 12, 2009);

FTC v. Five Star Auto Club, Inc., et al.

, No. 99-CIV-1963 (S.D.N.Y. Dec. 15, 2008).

The Commission proposes revising the Guides to state more clearly that they apply to business-to-business transactions and not just business-to-

consumer marketing.

The proposed, revised section on the “Purpose, Scope, and Structure of the Guides” (260.1) explains that the Guides apply to the marketing of products and services to “individuals, businesses, or other entities.”

A business consumer may interpret a marketer’s claims differently than an individual consumer. As stated in the FTC Policy Statement on Deception (“Deception Policy Statement”), appended to

Cliffdale Associates, Inc.

, 103 F.T.C. 110, 174 (1984), “[w]hen representations or sales practices are targeted to a specific audience, the Commission determines the effect of the practice on a reasonable member of that group. In evaluating a particular practice, the Commission considers the totality of the practice in determining how reasonable consumers are likely to respond.” Marketers, therefore, must understand how their ads will be interpreted by their customers.

Moreover, the proposed, revised Guides include specific business-to-business transaction examples.

Additionally, to increase businesses’ familiarity with the revised Guides, the Commission plans to expand its outreach efforts.

See

Section 260.6, Example 4; Section 260.12, Example 11.

C. Changes in Technology or Economic Conditions

1. Comments

The Notice asked commenters to discuss what modifications, if any, the Commission should make to the Guides to account for changes in relevant technology or economic conditions. In response, many commenters and workshop panelists observed that companies increasingly use the Internet to communicate with consumers about their environmental efforts,

and more consumers use the Internet to check on product claims and learn about products’ environmental attributes.

The Soap and Detergent Association, for example, noted that the “quality and accessability of online technology has greatly advanced” since the FTC released the Guides.

In its view, company websites have become an increasingly valuable and growing source of clarifying information for consumers about product benefits without the space limitations of packaging.

See

e.g.

, GMA, Green Packaging Workshop Tr. at 111-115.

See

GMA, Green Packaging Workshop Tr. at 111 (discussing a 2008 online survey showing that 80 percent of the 6,000 consumers interviewed use the Internet to obtain information about environmental initiatives and products); GMA, Comment 533431-00045 at 4;

see also

Cone LLC, Comment 534743-00007 at 8 (noting that when seeking additional information about a product’s environmental aspects, consumers examine the company’s website, third-party websites, search engines, and the package).

SDA, Comment 534743-00028 at 4.

Id.

Accordingly, some commenters suggested that the Guides specifically address the Internet and the opportunities it provides for increasing consumer access to product information. For example, the Soap and Detergent Association asked the FTC to determine appropriate circumstances in which information on a company website would be sufficient to explain an environmental claim.

Similarly, NatureWorks stated that the Guides should indicate that “it is acceptable to provide further levels of information on a website.”

The Society of the Plastics Industry suggested that the FTC consider allowing qualifiers that refer to websites, which would give companies a means of providing more accurate and detailed information about the availability of recycling facilities than can be provided on a typical package.

According to this commenter, encouraging consumers to visit a website for information on available recycling options would “both empower consumers to educate themselves about recycling options . . .

and

provide them the necessary roadmap by which to find recycling information quickly and readily, without a significant risk of prompting undesirable consumer behavior (

e.g.

, putting an item that cannot be recycled locally into the curbside recycling bin . . . .).”

SDA, Comment 534743-00028 at 4. SDA, however, did not set forth these circumstances.

NatureWorks, Green Packaging Workshop Tr. at 230;

see also

AF&PA, Comment 534743-00031 at 2 (stating that specific sectors should be able to develop focused definitions of sustainability that meet the needs of that sector and that references to websites should be sufficient to provide the necessary explanation).

SPI, Comment 534743-00034 at 3;

see also

Brenda Platt, Institute for Local Self-Reliance (“ILSR”), Green Packaging Workshop Tr. at 148 (suggesting that consumers could search a website to identify composting facilities).

SPI, Comment 534743-00034 at 4 (emphasis in original).

Along these lines, EHS Strategies, Inc., noting the pervasiveness of general environmental benefit terms such as “eco” and “green” in marketing, suggested that the Guides recommend that package labeling include a website, telephone number, or address so that consumers can obtain a detailed explanation of a product’s environmental attributes.

However, this commenter cautioned that “[w]hile reference to third-party standards and websites are useful, they are likely not . . . investigated by the consumer at point of purchase. Insofar as possible, sufficient point of sale information should be made available to the consumer as to what the environmentally preferred attributes are.”

EHS, Comment 534743-00011 at 2;

see also

EnviroMedia Social Marketing, Comment 534743-00032 at 1 (stating that companies making claims about their carbon footprint should be required to list a website to substantiate those claims); TerraChoice, Green Packaging Workshop Tr. at 207 (noting that marketers should make claim substantiation available to consumers via websites and toll-free numbers).

EHS, Comment 533431-00057 at 2.

2. Analysis

Using the Internet, marketers can provide consumers with useful environmental information about products, packages, and services. However, websites cannot be used to qualify otherwise misleading claims that appear on labels or in other advertisements because consumers likely would not see that information before their purchase. Any disclosures needed to prevent an advertisement from being misleading must be clear and prominent and in close proximity to the claim the marketer is qualifying.

These requirements help ensure that consumers notice, read, and understand disclosures to prevent deception.

Deception Policy Statement, 103 F.T.C. at 174.

D. International Laws

1. Comments

The Commission also sought comment on whether it should consider international laws, regulations, or standards with respect to environmental marketing claims in its Guides review. In response, many commenters recommended that the Commission harmonize the Green Guides with the International Organization for Standardization (“ISO”) 14021 environmental marketing standards

or at least incorporate some of its provisions.

ISO is a non-governmental organization which develops voluntary manufacturing and trade standards, including standards for self-declared environmental marketing claims. ISO 14021:1999(E) Environmental labels and declarations - Self-declared environmental claims (Type II environmental labeling).

Dow, Comment 533431-00010 at 4 (noting, however, that the Commission should not follow 14021’s “outdated” prohibition on sustainability); AF&PA, Comment 533431-00019 at 3; CSPA, Comment 533431-00049 at 2; EPI, Comment 533431-00063 at 4; EPA Environmental Preferable Purchasing Program (“EPA-EPPP”), Comment 533431-00038 at 6; FBA, 533431-00015 at 2; Foodservice Packaging Institute (“FPI”), Comment 533431-00074 at 3; Georgia-Pacific, Comment 533431-00007 at 6; GreenBlue, Comment 533431-00058 at 6; MeadWestvaco, Comment 533431-00013 at 2; SDA, Comment 533431-00020 at 2-3.

For example, one commenter observed that because several countries are in the process of adopting ISO 14021, the FTC should either align the Guides with ISO standards or clarify whether products labeled according to

ISO 14021 comply with the Guides when there is a discrepancy.

Another commenter stressed the importance of “close alignment with global standards,” noting that the discrepancy in how the Green Guides and ISO treat recyclable claims

causes problems with transnational packaging.

AF&PA, Comment 533431-00019 at 3;

see also

Georgia-Pacific, Comment 533431-00007 at 6.

ISO states that marketers must qualify recyclable claims if recycling facilities are not conveniently available to a “reasonable proportion” of purchasers where the product is sold. ISO 14021 7.7.2:1999(E). In contrast, the Guides provide that marketers should qualify recyclable claims if recycling facilities are not available to a “substantial majority” of consumers or communities where the product is sold.

See

16 CFR 260.7(d), Example 4.

MeadWestvaco, Comment 533431-00013 at 3;

see also

Georgia-Pacific, Comment 533431-00007 at 6 (suggesting that the Commission address discrepancies such as the definition of “post-consumer” fiber, the references to access to recycling and composting facilities, and the treatment of the Möbius Loop); Paper Recycling Coalition (“PRC”), Comment 533431-00035 at 1 (noting that the Guides should incorporate ISO definitions of recycling and post-consumer recycled content because competing definitions currently cause consumer confusion).

In addition, several commenters suggested that the FTC look to ISO for guidance on how to conduct a life cycle analysis to ensure consistency in the increasing number of claims using life cycle assessments for substantiation.

Two commenters, however, urged the FTC not to fully harmonize the Green Guides with international standards because “the obstacles and barriers to maintaining, changing or modifying, updating, and revising the system may be enormous” and could cause “tremendous effort and delay.”

Georgia-Pacific, Comment 533431-00007 at 3-4 (citing ISO 14040 and 14044);

see also

ACC, Comment 533431-00023 at 5; GreenBlue, Comment 533431-00058 at 6; P&G, Comment 533431-00070 at 3; Personal Care Products Council (“PCPC”), Comment 533431-00075 at 4; Preston, Comment 533431-00021 at 1; SDA, Comment 533431-00020 at 2-3.

NAIMA, Comment 533431-00042 at 12; Saint-Gobain, Comment 533431-00037 at 11-12.

2. Analysis

Because the FTC tries to harmonize its guidance with international standards when appropriate, the Commission gave careful consideration to relevant ISO provisions during the course of its review. The goals and purposes of ISO and the Green Guides, however, are not necessarily congruent. The Guides’ purpose is to prevent the dissemination of misleading claims, not to encourage or discourage particular environmental claims or consumer behavior based on environmental policy concerns. ISO, in contrast, focuses not only on preventing misleading claims, but also on encouraging the demand for and supply of products that may cause less stress on the environment.

In part because of this difference, the proposed Guides do not necessarily align with the ISO standards. The Commission further discusses ISO standards and any inconsistencies with the proposed Guides in the relevant sections: (1) General Environmental Benefit Claims (Part IV.A); (2) Recyclable Claims (Part IV.E); (3) Recycled Content Claims (Part IV.F); and (4) Free-of and Non-toxic Claims (Part IV.H).

The introduction to the ISO 14000 series describes the “Objective of environmental labels and declarations” as follows: “The overall goal of environmental labels and declarations is, through communication of verifiable and accurate information, that is not misleading, on environmental aspects of products and services, to encourage the demand for and supply of those products and services that cause less stress on the environment, thereby stimulating the potential for market-driven continuous environmental improvement.” ISO 14020 3:2000(E).

E. Overlap with Other Federal, State, or Local Laws

1. Comments

The Commission sought comment on whether the Guides overlap or conflict with other federal, state, or local laws or regulations, and if so, how. Most commenters did not identify any specific overlap or conflict. Two commenters, however, Saint-Gobain and the North American Insulation Manufacturers Association, expressed concern about the array of guidelines and standards emerging from local, state, and federal government agencies, noting that conflicting and competing guidelines vary in quality and, therefore, consumer utility.

Both commenters urged the FTC to “consider preempting state and local laws and regulations that are inconsistent with or frustrate the purposes of the Guides.”

Neither commenter, however, cited a specific law or regulation.

NAIMA, Comment 533431-00042 at 2, 11; Saint-Gobain, Comment 533431-00031 at 3,11.

NAIMA, Comment 533431-00042 at 11; Saint-Gobain, Comment 533431-00031 at 11.

Commenter Environmental Packaging International noted that the state of California has “more specific requirements than the Guides regarding the use of environmental marketing claims related to plastic packaging.”

For example, EPI stated that California requires that plastic bags and food and beverage containers labeled as “compostable,” “biodegradable,” or “degradable” or marketed using similar terms comply with the applicable ASTM International standard for the term used.

In contrast, the Green Guides do not refer to a particular industry standard.

EPI, Comment 533431-00063 at 4.

Id.

, citing Cal. Pub. Res. Code §§ 42355-42357, 42359-42359.6. ASTM International (“ASTM”) is an international standards organization that develops and publishes voluntary consensus technical standards for a wide range of materials, products, systems, and services.

International Paper observed that, although it is not aware of any specific conflicts with federal, state, and local laws, the Green Guides may conflict with nongovernmental and international voluntary standards, such as ASTM’s compostability standard.

It recommended that the FTC monitor these standards to try to eliminate any such issues. It also suggested that the FTC coordinate with other federal agencies. For example, it suggested that the FTC coordinate with the Environmental Protection Agency (“EPA”) in the recycling area to make policy and product labeling consistent with current marketplace reality.

International Paper, Comment 533431-00055 at 3.

Similarly, EPA’s Environmentally Preferable Purchasing Program suggested that the Guides specifically state that “environmentally preferable” claims “should follow established guidance in this area, such as EPA’s Guidance on Environmentally Preferable Purchasing, which emphasizes that such determinations should take into account multiple environmental attributes throughout the product’s life cycle.”

EPA-EPPP, Comment 533431-00038 at 7.

2. Analysis

Based on a review of the comments, the Green Guides do not appear to significantly overlap or conflict with other federal, state, or local laws. Although some commenters discussed the potential for conflict, none cited any particular conflicting laws. State law may be different from the Green Guides, but such differences do not necessarily present a conflict. For example, a company may follow the Green Guides’ provisions on biodegradability and compostability and still comply with California’s specific requirements that plastic bags and containers labeled as “biodegradable” and “compostable” meet ASTM standards.

Additionally, although some commenters sought FTC preemption of state and local laws, the Green Guides are not enforceable regulations and, therefore, cannot be legally preemptive.

Indeed, since 1996, California has required marketers to follow the Green Guides.

See

Cal. Bus. & Prof. Code § 17580-81.

16 CFR 260.2.

One commenter recommended that the Commission coordinate with other federal agencies. The Commission actively consults with other agencies,

such as the EPA, the Department of Energy (“DOE”), and the Department of Agriculture (“USDA”), regarding their areas of expertise to ensure that the Commission does not issue guidance that duplicates or possibly conflicts with their regulations and programs. For example, as discussed below, the Commission does not propose specific guidance for organic claims about agricultural products that already are covered by the USDA’s regulations.

See

Part VI.B,

infra

F. Life Cycle Analysis

Life cycle analysis (“LCA”) refers to the assessment of a product’s environmental impact through all the stages of its “life.” The EPA defines the term “life cycle” as “the major activities in the course of the product’s life-span from its manufacture, use, and maintenance, to its final disposal, including the raw material acquisition required to manufacture the product.”

As the EPA notes in its Final Guidance on Environmentally Preferable Purchasing, in the context of making purchasing decisions, the term “life cycle” has several interpretations: “[t]o some, it connotes an exhaustive, extremely time-consuming, and very expensive analysis. To others, a life cycle perspective is possible in an abbreviated process, in which a long list of potential environmental attributes and/or impacts is narrowed to a few, allowing for comparison across a particular product category.”

Accordingly, in its Final Guidance on Environmentally Preferable Purchasing, EPA states that it “promotes the use of a range of practices, from life cycle considerations to a more rigorous, scientifically defensible life cycle assessment methodology.”

See

(

http://www.epa.gov/nrmrl/lcaccess/pdfs/600r06060.pdf

See

(

http://www.epa.gov/epp/pubs/guidance/finalguidance.htm

Id.

The current Green Guides do not provide guidance on life cycle claims. Instead, the Guides include a footnote indicating that the Guides do not address such claims because the Commission “lacks sufficient information on which to base guidance.”

16 CFR 260.7 n.2.

1. Comments

Several commenters discussed whether and how the FTC should provide LCA guidance. Many noted that, since the last Guides review, LCA has become both a more accepted and better defined process,

and marketers increasingly utilize LCA to assess the environmental effect of their products.

For example, Georgia-Pacific observed that the international expert community in life cycle assessment has developed and agreed on requirements for making environmental comparisons or assertions to the public, which the series of ISO 14040 and 14044 standards reflect.

Other panelists, however, asserted that LCA is still an emerging concept.

SDA, Comment 534743-00028 at 3 (noting that procedures for a life cycle analysis are now part of ISO environmental management standards found under ISO 14000); Susan Selke, Michigan State University (“Michigan State Univ.”), Green Packaging Workshop Tr. at 163 (stating that in addition to ISO, there are numerous LCA standards, including certain Canadian standards and standards collected on EPA’s website).

See

e.g.

, GMA, Comment 533431-00083 at 10; PCPC, Comment 533431-00075 at 4; SDA, Comment 533431-00020 at 2; SPI, Comment 533431-00036 at 11.

Georgia-Pacific, Comment 533431-00007 at 7.

See

e.g.

, Michigan State Univ., Green Packaging Workshop Tr. at 188 (observing that LCA is not yet well understood by industry, academics, or consumers); Thomas R. Reardon, The Business and Institutional Furniture Manufacturer’s Association (“BIFMA”), Green Building and Textiles Workshop Tr. at 246-247.

In particular, commenters discussed: (1) whether marketers should refer directly to LCAs in marketing materials; and (2) whether marketers should substantiate certain claims with an LCA and, if so, whether the Guides should address LCA substantiation methodologies.

a. LCAs as Marketing Claims

Because of the complexity of LCAs, several commenters asserted that life cycle analysis should be regarded as a decision-making tool to help improve environmental outcomes, rather than as a marketing claim.

A participant in the Green Packaging Workshop, Susan Selke, for example, viewed life cycle analysis as “the right philosophical approach” for making decisions, but discouraged its use for communicating information or making claims to consumers, on the grounds that one must “interpret LCA in context for it to be meaningful.”

Similarly, EHS Strategies, Inc., commented that terms such as “cradle to cradle” and “life cycle” are ill-defined, comprised of multiple factors, and not amenable to understanding on a package label.

John Delfausse, Estée Lauder Companies (“Estée Lauder”), Green Packaging Workshop Tr. at 186; Michigan State Univ., Green Packaging Workshop Tr. at 186;

see also

ACC, Comment 533431-00023 at 5 (suggesting that LCA can be a useful tool in identifying marketing claims and what type of substantiation or qualification is necessary).

Michigan State Univ., Green Packaging Workshop Tr. at 163 (asserting she would “never advocate trying to summarize LCA results on a package”).

EHS, Comment 534743-000211 at 1;

see also

Estée Lauder, Green Packaging Workshop Tr. at 186 (noting that although consumers are interested in information pertaining to the life cycle and sustainability aspects of packaging, Estée Lauder does not recommend encouraging such claims in the Guides).

In contrast, one commenter reported the results of a study finding that LCA information showing quantitative and specific environmental impact information in an advertisement positively influences consumers’ attitudes toward an advertisement, brand, company, and intention to purchase a product.

The commenter concluded that “LCA-based metrics” may be the best method for effective communication of environmental attributes.

Another commenter stated it would support the use of a standardized label conveying the results of an LCA to consumers, such as an approach akin to the Food and Drug Administration’s (“FDA”) Nutrition Facts Label.

Univ. of Minnesota, Comment 536013-00004 at 1.

Id.

Estée Lauder, Green Packaging Workshop Tr. at 189 (noting that the Sustainable Packaging Coalition is working on a label concept, and stating that it is important to the industry to have some type of “nutritional” label that will be globally acceptable).

b. LCAs as Substantiation

Commenters also debated whether a full LCA should be required to substantiate environmental claims. While some commenters argued that marketers should be required to conduct a full LCA to support general environmental benefit claims, others argued that this would not be feasible due to inconsistent methodologies, complexity, and expense.

See

Part V.A,

infra

Moreover, some commenters suggested that the Guides could help ensure that companies conducting LCAs do so in a manner that meets the FTC’s substantiation standards.

In particular, the Glass Packaging Institute suggested that the Guides expressly state that LCAs must meet the FTC’s substantiation standard for environmental claims, which requires that marketers have “competent and reliable scientific evidence, defined as tests, analyses, research, studies or other evidence based on the expertise of professionals in the relevant area, conducted and evaluated in an objective manner by persons qualified to do so,

using procedures generally accepted in the profession to yield accurate and reliable results.”

Other commenters went further, noting that because life cycle analyses can vary in requirements and robustness, the Guides should indicate the LCA standards or methodologies that the Commission considers adequate.

See

e.g.

, Estée Lauder, Green Packaging Workshop Tr. at 176; GPI, Comment 534743-00026 at 10; SDA, Comment 534734-00026 at 3; Michigan State Univ., Green Packaging Workshop Tr. at 161.

See

e.g.

, GPI, Comment 534743-00026 at 10 (citing 16 CFR 260.5).

ACC, Comment 536013-00030 at 4; NatureWorks, Green Packaging Workshop Tr. at 217-18;

see also

Georgia-Pacific, Comment 533431-00007 at 7 (noting that the Guides should provide that claims based on LCA studies be conducted with the full analysis required by ISO 14044); P&G, Comment 533431-00070 at 2 (“While not all claims require a full LCA, recognizing acceptable international standards for LCA will help ensure consistency in claims that do rely upon LCAs for substantiation.”); SPI, Comment 533431-00036 at 12 (stating that the scope of the LCA may differ from advertiser to advertiser); USGBC, Comment 536013-00029 at 10-11 (suggesting that if the FTC addresses LCA, it should adopt a particular LCA approach, such as the National Renewable Energy Laboratory’s Life Cycle Inventory Database Project, or set forth specific LCA parameters that standardize the relevant impact categories, life cycle stages, and service periods that are the basis of these assessments).

2. Consumer Perception Evidence

The Commission’s study examined whether consumers believe that environmental claims such as “green,” “eco-friendly,” or “made with recycled materials” suggest anything about the environmental impact of a product through its life cycle.

For consumers who do think about a product’s life cycle, the study explored whether they think of more than one stage in that cycle and, if they do, which of the four specific stages (

i.e.

, production, transportation, use, and disposal). Only 16 percent of respondents viewing “green” claims and 14 percent of respondents viewing “eco-friendly” claims thought about each of the life cycle stages.

The Commission did not test consumer perception of life cycle claims in marketing,

i.e.

claims in which the environmental impacts of a product throughout a product’s life cycle are featured in an advertisement or label. The University of Minnesota submitted a study that examined life cycle-based information in marketing. This study, however, focused on consumer perceptions toward the advertiser and the brand, as well as “message credibility,” rather than consumer understanding of environmental claims. Comment 536013-00004 at 1.

Taking an average across all 15 tested claims (net of control), only nine percent of respondents indicated they thought of all four stages of a product’s life cycle when viewing a claim.

3. Analysis

After reviewing the comments and the results of its consumer perception study, the Commission has decided not to propose guidance about the use of life cycle information either in marketing or as substantiation for environmental claims.

First, the Commission lacks information about how consumers interpret life cycle claims in marketing. Moreover, due to the complexity and variability of these claims, general advice is unlikely to be useful in any particular case. Therefore, the Commission will continue to analyze these claims on a case-by-case basis.

Footnote 2 of the Guides currently states that the Guides do not address LCA claims. 16 CFR 260.7 n.2. The Guides also do not address other environmental claims, but they do not specifically identify these claims. For consistency, the Commission proposes deleting this footnote.

Second, the Commission declines to propose advising marketers either to conduct an LCA to substantiate environmental claims or to follow a particular LCA methodology. Relatively few respondents viewing broad environmental claims (approximately 15 percent) considered each of the life cycle stages. Therefore, the results of the study do not provide a basis for advising marketers to conduct an LCA to substantiate environmental claims. Marketers may rely on the results of an LCA as all, or part of, their substantiation, as long as they ensure that the LCA results constitute competent and reliable scientific evidence to support their claims. The Commission has no basis for choosing one LCA methodology over another. Accordingly, the Commission will continue to apply its substantiation analysis to claims relying on an LCA to determine whether the assessment: (1) has been conducted and evaluated in an objective manner by qualified persons and is generally accepted in the profession to yield accurate and reliable results; and (2) the LCA is sufficient in quality and quantity based on standards generally accepted in the relevant scientific fields, when considered in light of the entire body of relevant and reliable scientific evidence, to substantiate that each of the marketer’s claims is true.

V. Claims Addressed by the Current Green Guides

The Commission requested comment on what changes, if any, it should make to its existing guidance on specific claims (currently, in Section 260.7). This part of the Notice summarizes the comments and relevant workshop discussions, reviews the consumer perception evidence, and provides the Commission’s analysis of: (1) general environmental benefit claims; (2) certifications and seals of approval; (3) degradable claims; (4) compostable claims; (5) recyclable claims; (6) recycled content claims; (7) ozone-safe and ozone-friendly claims; (8) free-of and non-toxic claims; (9) source reduction claims; and (10) refillable claims.

A. General Environmental Benefit Claims

1. The Current Guides

The current Guides section on general environmental benefit claims (

e.g

., “environmentally friendly”) states: “[u]nqualified general claims of environmental benefit are difficult to interpret, and depending on their context, may convey a wide range of meanings to consumers. In many cases, such claims may convey that the product, package, or service has specific and far-reaching environmental benefits.”

The Guides remind marketers that they have a duty to substantiate “every express and material implied claim that the general assertion conveys to reasonable consumers about an objective quality, feature or attribute of a product.” Unless marketers can meet this “substantiation duty,” they should avoid, or qualify, these claims “as necessary, to prevent deception about the specific nature of the environmental benefit being asserted.”

The following addresses the comments discussing general environmental benefit claims, the Commission’s relevant consumer perception study findings, and the Commission’s proposed, revised guidance for such claims.

16 CFR 260.7(a).

Id.

2. Comments

As discussed below, many commenters asserted that general environmental benefit claims may confuse consumers and that the Commission should provide additional guidance on use of these claims, including what type of substantiation supports them and how marketers can effectively qualify them. Other commenters asserted that the Green Guides should prohibit general environmental claims altogether.

a. Substantiating General Environmental Benefit Claims - Life Cycle Considerations

Several commenters recommended that the Guides state that marketers making a general environmental claim have substantiation about the environmental impact of a product throughout its entire life cycle (

see

Part IV.F,

supra

, for a general discussion of comments regarding life cycle

analysis).

For example, Unilever United States, Inc. asserted that marketers should review all aspects of the product’s life cycle to substantiate “eco-friendly” claims because consumers reasonably interpret those claims to mean that the product as a whole offers a material environmental benefit and presents no significant environmental risk.

Similarly, EPA’s Sustainable Products Network (“EPA-SPN”) asserted that “general claims that imply overall superiority in environmental performance must be substantiated by information that addresses multiple environmental attributes over the product’s life cycle.”

See

e.g.

, Michigan State Univ., Green Packaging Workshop Tr. at 187 (“[I]t is precisely those broad claims that should never be made unless you can back them up and the only way you could back them up would be with a full blown life cycle analysis.”); Keith Christman, American Chemistry Council (“ACC”), Green Packaging Workshop Tr. at 210; GPI, Comment 534743-00026 at 9-10.

Unilever United States, Inc. (“Unilever”), Comment 534743-00030 at 1.

EPA-SPN, Comment 536013-00062 at 4;

see also

P&G, Comment 533431-00070 at 3 (stating that in the absence of a life cycle analysis, comparative environmental claims should be limited to specific and verifiable parameters regarding the sourcing of raw materials, manufacturing, transportation, or packaging); Georgia-Pacific, Comment 533431-00007 at 3.

Although these commenters agreed about the importance of considering a product over its life cycle, they advocated different types and levels of substantiation. Unilever, for example, suggested that the FTC develop criteria under which marketers would have to address the major stages of a product’s life cycle - its production, packaging, formula/ingredients, and disposability.

100

Under Unilever’s framework, if a company can meet eligibility standards for three out of these four criteria, it could still make a general environmental benefit claim as long as that unmet criterion is clearly and accurately disclosed (

e.g.

, “environmentally friendly, but not recyclable”).

100

Unilever, Comment 534743-00030 at 1-2.

EPA-SPN stated that a full quantitative life cycle assessment, “while highly desirable,” is not necessary. Instead, marketers should demonstrate that they have addressed “key attributes” from a life cycle perspective.

101

Georgia-Pacific also suggested that the FTC “recognize the use of the ISO 14040 series standards when comparing products and, in particular, the need to include the life cycle impact assessment phase of the LCA as one essential requirement in . . . comparing products.”

102

101

Specifically, EPA-SPN recommended that the following types of information provide “adequate substantiation” for general environmental benefit claims: “1) certification under voluntary consensus standards that include multiple environmental attributes based on consideration of the product’s life cycle; 2) certification under multi-attribute, life cycle-based eco-labeling programs, such as labeling programs that follow the requirements of the ISO 14024 standard for Type 1 environmental labels; or 3) life cycle analyses that follow the requirements of the ISO 14040-series of standards for life cycle assessment.” EPA-SPN, Comment 536013-00062 at 11;

see also

EPA-EPPP, Comment 533431-00038 at 6.

102

Georgia-Pacific, Comment 533431-00007 at 3.

Several other commenters, however, argued that the FTC should not require marketers making general environmental claims to conduct a full LCA. According to the Business and Institutional Furniture Manufacturer’s Association, while conducting an LCA is “an admirable aspiration,” the science concerning LCA is not sufficiently well established to mandate such a requirement.

103

Similarly, the Formaldehyde Council, Inc. asserted that there is a debate regarding how various factors used in life cycle assessment are weighted in developing an overall assessment.

104

Other commenters similarly argued that life cycle assessment should not be the only tool available to marketers to substantiate general environmental claims, explaining that LCAs are complex, difficult to interpret, and costly.

105

Therefore, commenters noted that conducting an LCA may not be feasible even for large companies.

106

103

BIFMA, Green Building and Textiles Workshop Tr. at 246; Sophia Greenbaum, Sustainable Buildings Industry Council (“SBIC”), Green Building and Textiles Workshop Tr. at 246 (suggesting that there is no single methodology for establishing life cycle analysis);

see also

Green Seal, Green Building and Textiles Workshop Tr. at 247.

104

Formaldehyde Council, Inc., Comment 533431-00047 at 3.

105

SDA, Comment 534734-00028 at 3 (stating the FTC should not require an LCA as substantiation for “properly qualified, well-supported claims” due to the cost such a requirement would impose on small businesses, but that the Guides, nevertheless, should encourage marketers to conduct a “sufficient inquiry to avoid the use of claims . . . that do not acknowledge other significant environmental impacts associated with a product’s formulation process or its use”); The Clorox Company (“Clorox”), Comment 534743-00017 at 1 (asserting that even when marketers are making general claims, they should not be required to conduct a life cycle assessment);

see also

ACC, Comment 533431-00023 at 5 (stating that LCA studies should not be a necessary precondition to making an environmental claim).

106

Estée Lauder, Green Packaging Workshop Tr. at 176; Michigan State Univ., Green Packaging Workshop Tr. at 161.

b. Qualifying General Environmental Benefit Claims

Some commenters recommended that the Guides provide additional advice on how marketers can effectively qualify general environmental benefits. For example, one commenter suggested that the Guides should advise marketers on how to use more effective qualifiers. This commenter specifically advised the Commission to require that qualifications be “clear, understandable, prominently displayed, and indicate an actual environmental benefit.”

107

This commenter also emphasized that a consumer evaluating an advertisement should be able to “quickly and easily tell that the environmental benefit that the product has is the specific environmental benefit indicated, not the wider general benefit included in the ad’s message -

i.e.

, by such phrases as ‘environmentally friendly.’”

108

Another commenter asserted that the FTC should provide examples of accompanying language that would be specific enough to allow the use of these types of claims.

109

107

Krenn, Comment 533431-00014 at 5.

108

Id.

109

3M Company, Comment 533431-00027 at 3;

see also

EHS, Comment 533431-00057 at 2 (suggesting that general claims should never appear without a clear statement of the product’s specific attributes and that “sufficient point of sale information should be made available to the consumer as to what the environmentally preferred attributes are”).

c. Prohibiting All General Environmental Benefit Claims

Some commenters argued that by allowing general environmental benefit claims, even when qualified, the Guides facilitate deception.

110

These commenters, therefore, recommended that the Green Guides prohibit all general environmental claims. For example, GreenBlue argued that there is no single definition of general environmental benefit terms such as “green” or “environmentally friendly.” Therefore, their use only confuses consumers even if the terms are qualified with text that describes the specific attribute that contributes to their “green” status.

111

GreenBlue noted that “environmental excellence” in one attribute can result in trade-offs in another. For example, the increased use of recycled content may require less energy for material production, but may result in greater weight and, therefore, higher energy costs for transportation.

According to GreenBlue, because such trade-offs are sufficiently common, the Guides should discourage general environmental benefit claims, even when accompanied by a specific-attribute qualifier, unless a company is willing to include a full explanation of environmental trade-offs.

110

Banning general environmental benefit claims would be consistent with ISO 14021, which prohibits general environmental claims. Specifically, ISO 14021 provides that “[a]n environmental claim that is vague or non-specific or which broadly implies that a product is environmentally beneficial or environmentally benign shall not be used. Therefore, environmental claims such as ‘environmentally safe,’ ‘environmentally friendly,’ ‘earth friendly,’ ‘non-polluting,’ ‘green,’ ‘nature’s friend,’ and ‘ozone friendly’ shall not be used.” ISO 14021 5.3:1999(E).

111

GreenBlue, Comment 533431-00058 at 4-5.

Similarly, EPA-SPN provided an example of a potentially deceptive qualified claim. It noted that a product advertised as “Eco-safe because of low-VOC content” implies that VOC content is the most important factor in determining “overall environmental performance.” EPA-SPN cautioned that it is not possible to know if this is actually the case without information on other product attributes. EPA-SPN, therefore, suggested that marketers “state the claim in terms of the relevant attribute without implying broader environmental benefit,

e.g.

, “100% post-consumer content” or “low VOC.” EPA-SPN also recommended that any further description be limited to a statement of environmental benefit directly related to the attribute. Thus, according to EPA-SPN, a claim such as “Low VOC - promotes cleaner air” would be proper because “VOC emissions have a clear relationship to air quality.”

112

EPA-SPN, Comment 536013-00062 at 4-5;

see also

EPI, Comment 533431-00063 at 4 (suggesting that the Commission revise the Guides to make clear that information about specific product attributes will not necessarily qualify general environmental claims); Rebekah Lacey (“Lacey”), Comment 533431-00062 at 2 (“Manufacturers . . . should not be able to pick and choose the criteria they use to make general environmental benefit claims. Even if they disclose the criteria, they are still implying that the criteria are appropriate, which is inherently misleading if the criteria focus on a narrow aspect of the product’s life cycle environmental impact.”); USGBC, Comment 536013-00029 at 9 (noting that qualifying broad environmental claims based on a single product attribute may be misleading because it ignores the full impact of the product on the environment).

3. Consumer Perception Evidence

Only a few commenters submitted consumer perception evidence addressing general environmental benefit claims.

113

Thus, the Commission’s study focused on this issue. The study examined whether both unqualified and qualified general green claims suggested that the product has particular environmental benefits. Specifically, the study asked respondents whether these types of claims conveyed that the product had any of the following seven environmental attributes: made from recycled materials, made with renewable materials, recyclable, made with renewable energy, biodegradable, non-toxic, and compostable. Thus, for example, would consumers viewing a “green” or an “eco-friendly” claim think that the advertised product had specific green attributes, such as being made with recycled materials or being recyclable? Additionally, if the general green claim were qualified with a specific environmental attribute, such as “green - made with renewable materials,” would consumers think the product had environmental benefits beyond the specific attribute mentioned?

114

113

See

e.g.

, Cone LLC, Comment 534743-00007 at 2 (describing its February 2008 online survey of over 1,000 consumers and noting that 48 percent of respondents believed a product marketed as “green” or “environmentally friendly” has a “positive, (

i.e.

, beneficial) impact” on the environment).

114

The Commission tested the following qualified-general claims: “green - made with renewable materials”; “green - made with renewable energy”; “green - made with recycled materials”; “eco-friendly - made with renewable materials”; “eco-friendly - made with renewable energy”; and “eco-friendly - made with recycled materials.”

Averaging across the seven attributes, 52 percent of respondents viewing an unqualified “green” claim indicated that they believed that the product had a specific attribute about which the survey asked. In particular, responses for individual attributes ranged from 61 percent (product is made from recycled materials) to 40 percent (product is compostable). The responses concerning an unqualified “eco-friendly” claim were similar. Averaging across the seven attributes, 49 percent indicated that the claim suggested that the product had a particular attribute. Specifically, responses for individual attributes ranged from 56 percent (product is made from recycled materials) to 36 percent (product is made with renewable energy). When the general environmental claims were qualified, however, on average, 31 percent of consumers indicated that the claim implied specific environmental benefits in addition to the attribute stated.

115

This figure was derived by calculating an average of responses regarding six qualified-general claims (three of which qualified “green”; three of which qualified “eco-friendly”). When participants were asked to evaluate a claim that included one of the specific-attribute claims, such as “green - made with renewable materials,” we did not include responses regarding that attribute (“made with renewable materials”) in that calculation.

In addition to asking consumers about unqualified and qualified-general environmental benefit claims, the study asked consumers how they perceive certain specific-attribute claims alone (

i.e.

, claims that a product is “made with recycled materials,” “made with renewable materials,” or “made with renewable energy”). This allowed the Commission to compare qualified-general claims to specific-attribute claims to determine the extent to which the general environmental claim (

e.g.

, “green,” “eco-friendly”) contributed to consumer perceptions. On average, 23 percent of respondents viewing specific-attribute claims indicated that the claim implied specific benefits in addition to the attribute stated.

The study further examined whether consumers believe that environmental claims suggest anything about any negative environmental impact that may come from the product. Twenty-seven percent of respondents interpreted the unqualified claims “green” and “eco-friendly” as suggesting the product has no negative environmental impact.

116

Sixteen percent of respondents viewing a qualified “green” claim and 17 percent of those viewing a qualified “eco-friendly” claim made the same inference, while only ten percent of respondents viewing a specific-attribute claim made this inference.

116

This figure is based on the responses to a closed-ended question on what “green” or “eco-friendly” claims suggest or imply about any negative environmental impact resulting from the tested products. Responses to subsequent questions suggest that respondents were not all thinking about negative environmental impact in exactly the same way in answering this question.

4. Analysis and Guidance

Both the comments

117

and FTC staff’s Internet surf

118

indicate that general environmental claims are pervasive. Such general claims appear both alone

119

and accompanied by specific claims.

120

To address their potential for consumer deception, and based on the comments and the Commission’s consumer perception study, the Commission proposes advising marketers not to make unqualified general environmental benefit claims.

121

The proposed, revised Guides also provide more prominent guidance on how to effectively qualify general environmental benefit claims.

117

See

e.g.

, ACC, Comment 533431-00023 at 6; Clorox, Comment 534743-00017 at 1; 3M Company, Comment 533431-00027 at 3; Krenn, Comment 533431-00014 at 2; TerraChoice, Comment 533431-00040 at 3.

118

In December 2008, FTC staff conducted a review of Internet sites to investigate the nature and incidence of certain environmental marketing claims.

See

Green Marketing Internet Surf, A Report by the FTC’s Division of Enforcement (“FTC Staff Internet Surf”).

119

In the FTC Staff Internet Surf, an express “green” claim occurred in 49 percent of the 799 web pages containing general environmental claims, and eco-/earth-/environmentally “friendly” occurred in 41 percent of them.

120

For example, in the FTC Staff Internet Surf, on the 799 web pages with general environmental claims, renewability claims co-occurred on 36 percent of the pages; carbon claims co-occurred on 35 percent of them; recycled content claims co-occurred on 18 percent; and biodegradability claims co-occurred on 12 percent.

121

This proposed guidance can be found in 16 CFR 260.4.

a. Unqualified General Environmental Benefit Claims

The consumer perception evidence and some comments reaffirm the current Guides’ advice that unqualified general environmental benefit claims convey a range of meanings. For example, the Commission’s consumer perception study found that 61 percent of respondents viewing an unqualified “green” claim believed the product is made from recycled materials; 59 percent believed the product is recyclable; 54 percent believed the product is made with renewable materials; 53 percent believed the product is biodegradable; 48 percent believed the product is made with renewable energy; 45 percent believed the product is non-toxic; and 40 percent believed the product is compostable.

122

Averaging across these seven attributes, 52 percent of respondents viewing an unqualified “green” claim stated that the claim definitely or probably suggested that the product had these specific green attributes. The percentages are similar for respondents viewing an “eco-friendly” claim.

123

Moreover, 27 percent of respondents interpreted the unqualified claims “green” and “eco-friendly” as suggesting the product has no negative environmental impact.

122

As discussed above, the Commission tested the claims as they appeared on laundry baskets, kitchen flooring, and wrapping paper. The response rates for laundry baskets and kitchen flooring were very similar. A slightly larger percentage of respondents perceived wrapping paper to possess unstated environmental attributes. However, because the responses were interpreted net of a non-environmental control claim, the analysis largely eliminated this difference from the results.

123

Of respondents viewing an “eco-friendly” claim, 57 percent believed the product is recyclable; 56 percent believed the product is made from recycled materials; 55 percent believed it is biodegradable; 51 percent believed it is made with renewable materials; 47 percent believed it is non-toxic; 43 percent believed it is compostable; and 36 percent believed it is made with renewable energy. The average value was 49 percent.

Given these findings, and because FTC law requires marketers to substantiate every express and implied environmental benefit that consumers reasonably could take from such a claim,

124

unqualified general environmental marketing claims remain very difficult, if not impossible, to substantiate. Very few products, if any, have all of the attributes consumers appear to perceive from general environmental benefit claims. In addition, given that all products have some environmental impact, it is doubtful that a marketer could substantiate that a product has no or negligible negative environmental impact. The Commission, therefore, proposes revising the Guides to more directly caution marketers not to make unqualified general environmental benefit claims.

124

FTC Policy Statement Regarding Advertising Substantiation (“Substantiation Policy Statement”), appended to

Thompson Medical Co.

, 104 F.T.C. 648, 839 (1984),

aff’d

, 791 F.2d 189 (D.C. Cir. 1986),

cert. denied

, 479 U.S. 1086 (1987).

Because marketers should not make unqualified general environmental benefit claims, the Commission declines to adopt commenters’ suggestions that the Guides delineate the particular substantiation needed to support such claims. Moreover, unlike the approach taken by ISO 14021, which prohibits general environmental claims, the Commission does not propose advising marketers to never use a general environmental benefit claim. As discussed below, marketers may be able to effectively qualify these claims to focus consumers on the specific environmental benefits that marketers could substantiate.

b. Qualified General Environmental Benefit Claims

The current Guides state that marketers may make broad environmental claims if they are “qualified, as necessary, to prevent deception about the specific nature of the environmental benefit being asserted.”

125

Through examples, the Guides also advise marketers that qualifications should be sufficiently “clear and prominent” to convey the idea that the claim refers only to limited environmental benefits and that “no other deceptive implications are created by the context.” The Commission’s consumer perception study supports this advice by demonstrating that qualifying a general green claim reduces the number of respondents believing: (1) that a product has specific, unstated benefits; and (2) that a product has no negative environmental impact.

125

16 CFR 260.7(a).

First, as discussed above, on average, approximately half of the respondents viewing a general, unqualified “green” claim believed that the claim suggested specific, unstated environmental benefits. When viewing a qualified “green” claim, on average, substantially fewer consumers (30 percent) believed that the claim suggested specific, unstated benefits.

126

For example, when a “green” claim was qualified with the statement “made with recycled materials,” 26 percent of respondents took away implied claims, a decrease of 26 percentage points. Similarly, when a “green” claim was qualified with the statement “made with renewable energy,” 29 percent of respondents took away implied claims, a decrease of 22 percentage points.

126

To calculate this number, the Commission took an average across all three qualified- “green” claims: “green - made with renewable materials”; “green - made with renewable energy”; and “green - made with recycled materials.” The results are similar for qualified “eco-friendly” claims, where, on average, 32 percent of participants took away the specific, unstated attributes, compared to the 49 percent who took away specific, unstated attributes when presented with the unqualified “eco-friendly” claim.

Second, the survey results indicate that the qualification of a general claim reduces consumer misperception of a product’s overall environmental impact. While 27 percent of respondents stated that a product advertised with an unqualified “green” or “eco-friendly” claim had no environmental impact, only 16 percent of respondents viewing a qualified “green” claim, and 17 percent of those viewing a qualified “eco-friendly” claim, made the same inference.

Although the percentage of respondents believing that a product had specific, unstated benefits and had no negative impact significantly decreased, some respondents still saw implied claims. Specifically, 31 percent of respondents saw implied claims, and 17 percent believed a product had no negative impact. To determine the extent to which the general environmental claim (

e.g.

, “green,” “eco-friendly”) contributed to these continuing perceptions, the Commission compared qualified-general claims to specific-attribute claims alone (

e.g.

, “made with recycled materials”). Respondents viewing qualified-general claims were only eight percent more likely to see implied claims than those viewing the specific-attribute only claims.

127

Moreover, respondents viewing qualified-general claims were only approximately six percent more likely to state that the product had no negative environmental impact than those viewing specific-attribute claims alone.

128

Thus, when qualified, the use of a general green claim did not appear to significantly contribute to consumers’ propensity to see implied claims or to believe a product had no negative environmental impact.

127

On average, 31 percent of consumers viewing qualified-general claims and 23 percent of consumers viewing specific-attribute claims saw implied claims.

128

On average, approximately 16 percent of consumers viewing qualified-general claims and 10 percent of consumers viewing specific-attribute claims believed the claims implied no negative environmental impact.

The results, therefore, suggest that qualifying a general environmental claim can focus consumers on the specific advertised benefit and significantly reduce misperceptions

about negative environmental impact. Based on these findings, the Commission proposes to emphasize the current Guides’ advice on qualifying general environmental benefit claims. The proposed, revised section states that marketers must use clear and prominent qualifying language to convey to consumers that a general environmental claim refers only to a specific and limited environmental benefit. The section also cautions marketers that explanations of specific attributes, even when true and substantiated, will not adequately qualify a general environmental marketing claim if the advertisement’s context implies other deceptive claims. Therefore, the proposed Guides remind marketers they should ensure that the advertising’s context creates no deceptive implications.

Marketers also should use caution with qualifications to ensure that they are not making additional claims they cannot substantiate. The Commission’s study demonstrates that even some specific-attribute claims caused consumers to believe the advertised product had other, unstated environmental attributes. For example, 30 percent of respondents viewing a “made with renewable materials” claim believed the advertised product had environmental attributes not expressly mentioned in the claims. Therefore, marketers must substantiate additional claims conveyed by the qualification itself.

Determining whether a general environmental claim is adequately qualified depends heavily on the claim’s context.

129

To provide additional guidance on this point, the Commission proposes adding a new example to the Guides. In proposed Example 3, the marketer’s claim that its packaging is now “Greener than our previous packaging” is likely deceptive even though the marketer reduced the weight of its packaging, compared to previous packaging, by 15 percent. The example notes that consumers likely interpret “Greener” in this context to mean that other significant environmental aspects of the packaging have been improved. Proposed Example 3 suggests that the marketer qualify the claim by clearly stating that it reduced the weight of its packaging, compared to previous packaging, by 15 percent. If the advertisement’s context does not imply other deceptive claims, this claim likely would not be deceptive.

129

In determining if reasonable consumers are likely to take an implied claim, the Commission looks at the net impression created by the advertisement as a whole. Deception Policy Statement, 103 F.T.C. at 179. Example 2 in the current and proposed Guides presents a scenario in which the context of the claim creates “deceptive implications.” 16 CFR 260.7(a), Example 2. In this example, a product wrapper is printed with the claim “environmentally friendly.” Text on the wrapper explains that the wrapper is environmentally friendly because it was “not chlorine bleached, a process that has been shown to create harmful substances.” Although the wrapper was not bleached with chlorine, its production releases other harmful substances. Since consumers are likely to interpret the “environmentally friendly” claim,

in combination with the textual explanation

, to mean that no significant harmful substances are currently released into the environment, the “environmentally friendly” claim would be deceptive.

The Commission is concerned that a general environmental benefit claim, in combination with a particular attribute, may imply that the particular attribute provides the product with a net environmental benefit. If a particular attribute represents an environmental improvement in one area, but causes a negative impact elsewhere that makes the product less environmentally beneficial than the product otherwise would be, consumers may be misled. For example, a marketer that claims its product is “Green - Now contains 70 percent recycled content,” needs to import more materials from a distant source, resulting in increased energy use which more than offsets the environmental benefit achieved by using recycled content. If consumers interpret the claim “Green - Now contains 70 percent recycled content” to mean that the product has a net environmental benefit, the claim would be deceptive. The Commission, therefore, requests comment on consumer interpretation of qualified-general environmental benefit claims and on whether to include guidance concerning this issue.

The following part on certifications and seals further discusses the issue of broad, unqualified green claims and includes additional examples of effective qualifications.

B. Certifications and Seals of Approval

1. The Current Guides

Currently, the Guides do not contain a section devoted to certifications and seals of approval. However, one example notes that an environmental seal of approval (“seal”) may imply that a product is environmentally superior to other products. Specifically, Example 5 in the general environmental benefit claims section provides: “A product label contains an environmental seal, either in the form of a globe icon, or a globe icon with only the text ‘Earth Smart’ around it. Either label is likely to convey to consumers that the product is environmentally superior to other products. If the manufacturer cannot substantiate this broad claim, the claim would be deceptive.”

130

Accordingly, the Guides instruct marketers who use environmental seals to accompany such claims with clear and prominent language limiting any environmental superiority representation to the particular product attribute or attributes it can substantiate.

131

130

16 CFR 260.7(a), Example 5.

131

Id.

FTC staff’s brochure for businesses, “Complying with the Environmental Marketing Guides,” (“FTC Staff’s Business Brochure”) reiterates this guidance and states that third-party certification does not insulate an advertiser from Commission scrutiny or eliminate an advertiser’s obligation to ensure that it has substantiation for the claims communicated by the certification. In addition, the FTC Staff’s Business Brochure advises that if a seal of approval “implies that a third party has certified the product, the certifying party must be truly independent from the advertiser and must have professional expertise in the area that is being certified.” FTC Staff’s Business Brochure, Complying with the Environmental Marketing Guides at 6,

available at

(

http://www.ftc.gov/bcp/edu/pubs/business/energy/bus42.pdf

2. Comments

Several commenters and panelists identified the use of third-party certifications as a significant green marketing trend

132

and highlighted the benefits of such certifications to businesses and consumers.

133

For example, Green Seal, Inc. asserted that third-party certification provides marketers with independent and credible substantiation.

134

Weyerhaeuser stated that third-party certifications are “useful in technical areas, where consumers face difficulty in understanding or directly measuring benefits.”

135

Similarly, the U.S. Green Building Council observed that “when properly administered by certifying organizations truly independent of the product manufacturer and appropriately represented by marketers, . . . third-party certification takes the guesswork out of consumer purchases, providing an independent and expert assessment of

technical product claims that may be difficult for consumers to interpret or verify on their own.”

136

Cone LLC affirmed that consumers rely on certifications when evaluating environmental claims. Its opinion survey found that 80 percent of respondents believed that certification by third-party organizations is “important in providing oversight to ensure environmental messaging by companies is accurate.”

137

132

See

e.g.

, Weyerhaeuser, Comment 534743-00033 at 2 (“The emergence of environmental seals and third-party certifications is one of the most important trends the FTC identified as posing potential problems for consumers.”); AF&PA, Comment 534743-00031 at 2; David Mallen, National Advertising Division, CBBB (“NAD”), Green Packaging Workshop Tr. at 46; USGBC, Comment 534743-00027 at 3.

133

See

e.g.

, USGBC, Comment 536013-00029 at 3-4 (noting that rating systems provide a consistent and quantifiable definition of “green building” for consumers and an expert, third-party assurance that technical claims are true); Clorox, Comment 534743-00017 at 1.

134

Green Seal, Green Packaging Workshop Presentation at (

http://www.ftc.gov/bcp/workshops/packaging/presentations/baldwin.pdf

135

Weyerhaeuser, Comment 534743-00033 at 2;

see also

Clorox, Comment 534743-00017 at 1; Formaldehyde Council, Comment 533431-00047 at 6.

136

USGBC, Comment 534753-00027 at 3.

137

Cone LLC, Comment 534743-00007 at 9;

see also

Tandus, Comment 536013-00037 at 1 (“[I]ndependent, third party verification and certification provides extra credibility and assurance that the manufacturers’ claims are truthful and accurate.”).

One commenter, however, noted that consumers typically cannot verify third-party certifications. Therefore, there is a “heightened degree of trust involved, and there is a heightened degree of credibility that is at stake.”

138

Other commenters cautioned that seals and logos may communicate a general claim of environmental preferability with no means for the consumer to determine which environmental benefits form the basis for the claim.

139

138

NAD, Green Packaging Workshop Tr. at 46.

139

CSPA, Comment 533431-00049 at 2-3; P&G, Comment 533431-00070 at 2; SDA, Comment 536013-00018 at 2; USGBC, Comment 536013-00029 at 6; Saint-Gobain, Comment 533431-00037 at 7-8.

Notwithstanding the benefits of third-party certifications, several panelists and commenters highlighted areas of potential consumer confusion and made various suggestions regarding how to address that confusion. The following discusses commenters’ suggestions addressing the use of certifications and seals in marketing and when third-party certifications adequately substantiate environmental claims.

a. Use of Certifications and Seals in Marketing

Several panelists and commenters suggested that the FTC provide additional guidance on when the display of certifications and seals is likely to mislead consumers.

140

For example, one commenter asserted that seals of approval and “eco-labels” “that communicate a general ‘environmentally friendly’ message to consumers should be treated as environmental claims within the scope of the guides and be subject to applicable principles and criteria.”

141

This commenter suggested that the FTC more prominently feature its advice on the need to qualify certain types of seals that could connote general environmental benefits.

142

Another commenter suggested that marketers generally should not use “vague, undefined” environmental terms but should be able to incorporate such terms into certifications, as long as the marketer makes the method and terms of the certification publicly available and easily accessible.

143

140

See

e.g.

, ACC, Comment 536013-00030 at 3-4; CSPA, Comment 533431-00049 at 2-3; Johns Manville, Comment 536013-00034 at 6; Michelle Moore, USGBC, Green Building and Textiles Workshop Tr. at 197; SBIC, Green Building and Textiles Workshop Tr. at 224; SPI, Comment 533431-00036 at 11; USGBC, Comment 536013-00029 at 3.

141

P&G, Comment 533431-00070 at 2;

see also

USGBC, Comment 536013-00029 at 6 (stating that marketers should specify the attributes to which a seal refers in order to help consumers interpret their meaning); CSPA, Comment 533431-00049 at 3; Saint-Gobain, Comment 533431-00037 at 3.

142

P&G, Comment 533431-00070 at 2;

see

16 CFR 260.7(a), Example 5.

143

Greenpeace USA, Comment 536013-00020 at 3.

Several commenters recommended that the Guides include examples illustrating ways in which marketers could effectively qualify third-party certifications and seals of approval.

144

In the building context, for example, commenters suggested the Guides include examples illustrating how marketers can qualify certifications to distinguish between building design features and performance and to clarify whether a certification applies to a product or whole building.

145

144

See

e.g.

, GMA, Comment 533431-00045 at 4; SPI, Comment 533431-00036 at 8-9.

145

See

e.g.

, ACC, Comment 536013-00030 at 1; Johns Manville, Comment 536013-00034 at 6; USGBC, Comment 536013-00029 at 4-5.

Commenters also recommended that the Guides address how marketers can avoid misleading consumers about the certifier’s independence.

146

For example, one commenter opined that self-certifications “can be misleading to consumers unless the company expressly discloses that the certification has not been conducted by an independent third-party.”

147

Another asserted that the Guides should address the financial relationship between the certifying organization and the company being certified.

148

146

ACC, Comment 536013-00030 at 3 (noting that marketers should distinguish seals based on voluntary consensus standards from other certifications and that the FTC should aid consumers in distinguishing among certification programs, including those that use life cycle assessment as the basis for certification); Frank Hurd, CRI (“CRI”), Green Building and Textile Workshop Tr. at 153; Johns Manville, Comment 536013-00034 at 7-8; NAIMA, Comment 536013-00017 at 9; USGBC, Comment 536013-00029 at 2-3.

147

CRS, Comment 534743-00009 at 4-5;

see also

Gensler, Green Building and Textiles Workshop Tr. at 109 (highlighting the differences between self-certification; certification where there is a relationship between the certifying organization and marketer -

e.g.

, marketer is a member of the certifying trade association; and certification by an independent third-party).

148

Skye Con, Comment 536013-00036 at 3.

In addition, commenters addressed how marketers can avoid misleading consumers about the basis for a certification. For example, because consumers may confuse a logo that simply indicates membership in an organization with one that certifies an aspect of a product’s environmental performance, a commenter recommended that marketers distinguish between the two.

149

Other commenters suggested that the FTC provide guidance to help avoid confusion about certifications that falsely appear to be bestowed by a government agency.

150

Finally, commenters observed that certification programs may address some, but not all, aspects of a product.

151

Therefore, they recommended guidance cautioning marketers not to indicate approval of an environmental attribute that the certifier did not evaluate.

152

149

SBIC, Green Building and Textile Workshop Tr. at 224;

see also

Gensler, Green Building and Textile Workshop Tr. at 135 (stating that marketers need to make sure that graphics do not imply more than is actually being delivered); OMI, Comment 536013-00022 at 3 (noting that advertisements must clearly state whether a logo refers to membership only or a “verifiable claim of certification”).

150

ACC, Comment 536013-00030 at 4; NAIMA, Comment 536013-00017 at 8.

151

USGBC, Comment 534743-00027 at 4;

see also

SDA, Comment 534743-00028 at 3.

152

USGBC, Comment 534743-00027 at 4.

b. Third-Party Certifications as Substantiation

Commenters also advised the FTC to address the use of third-party certifications to substantiate claims. Several urged the Commission not to require third-party certification as substantiation for an environmental claim.

153

Others recommended that the FTC revise the Guides to set forth the parameters of a third-party certification that would constitute adequate substantiation.

154

Some commenters

and panelists stated that marketers relying on a third-party certification as substantiation must be able to show that the certifying party is truly independent from the advertiser and that the certifying party has professional expertise in the area that is being certified.

155

Thus, for example, some commenters proposed that the Guides reiterate, or at least cross-reference, the principles outlined in the Guides Concerning the Use of Endorsements and Testimonials in Advertising (“Endorsement Guides”),

156

including that endorsements may not contain factual representations that would be deceptive or could not be substantiated if made directly by the advertiser

157

and that marketers should not rely on endorsements by entities that have a monetary or other relationship with the marketer.

158

153

ATA, Comment 533431-00041 at 8 (stating that requiring third-party certification to substantiate claims “would impose unnecessary and impractical burdens on advertisers” and that those claims may already be adequately substantiated under the FTC Act); AF&PA, Comment 533431-00019 at 2; Sappi Fine Paper North America (“Sappi”), Comment 534743-00023 at 2; Skye Con, Comment 536013-00036 at 3; The Vinyl Institute (“Vinyl Institute”), Comment 533431-00046 at 4.

But see

Healey, Comment 533431-00048 at 7 (stating that FTC could prohibit broad claims unless they are certified by an independent party); Patagonia, Inc. (“Patagonia”), Comment 536013-00011 at 1 (noting that marketers making “safer” chemical use or water/energy conservation claims in textiles should substantiate claims with third-party certifications).

154

See

e.g.

ACC, Comment 536013-00030 at 3-4; AF&PA, Comment 536013-00021 at 2-3; AZS

Consulting, Inc., Comment 536013-00024 at 1-2; Healey, Comment 533431-00048 at 2; Johns Manville, Comment 536013-00034 at 6; SDA, Comment 536013-00018 at 2; Skye Con, Comment 536013-00036 at 3; SPI, Comment 533431-00036 at 12; USGBC, Comment 536013-00029 at 4; Vinyl Institute, Comment 536013-00019 at 2-3; Weyerhaeuser, Comment 536013-00035 at 2.

155

See

e.g.

GMA, Comment 533431-00045 at 6;

see also

Todd Copeland, Patagonia, Inc. (“Patagonia”), Green Building and Textiles Workshop Tr. at 81-82; ECOnscious, Comment 536013-00023 at 1-2; Grace Gershuny, Organic Trade Association (“OTA”), Green Building and Textiles Workshop Tr. at 62; Oeko-Tex Certification Body (USA) (“Oeko-Tex”), Comment 536013-00013 at 4; Skye Con, Comment 536013-00036 at 3.

156

16 CFR Part 255.

157

GMA, Comment 533431-00045 at 6; Johns Manville, Comment 536013-00034 at 6; Cassie Phillips, Weyerhaeuser (“Weyerhaeuser”), Green Packaging Workshop Tr. at 220-221; Weyerhaeuser, Comment 534743-00033 at 2.

158

AF&PA, Comment 534743-00031 at 2;

see also

CRS, Comment 534743-00009 at 4 (stating that because consumers assume certifications have been conducted by independent third-parties, companies should expressly disclose when they have not); AF&PA, Comment 534743-00031 at 2; Green Seal, Green Packaging Workshop Tr. at 199-200; Healey, Comment 533431-00048 at 8.

Panelists and commenters also suggested the Guides provide that third-party certification programs be developed through an open, transparent and balanced process, such as programs accredited through the American National Standards Institute (“ANSI”).

159

Other commenters, however, observed that achieving openness and balance is difficult because not all parties may be given a voice in the proceedings, and those making the decisions on the standard may possess ideological views adverse to certain interests.

160

159

USGBC, Green Building and Textile Workshop Tr. at 134,160-61; USGBC, Comment 536013-00029 at 5;

see also

Oeko-Tex, Comment 536013-00013 at 6.

160

Vinyl Institute, Comment 536013-00019 at 2;

see also

ECM Biofilms, Inc. (“ECM Biofilms”), Comment 534743-00025 at 2 (commenting that to be an active member of ASTM and to author standards takes resources that are not available to many organizations, and “[a]s a result, standards are written to be beneficial to certain organizations”).

In lieu of delineating general parameters, some panelists and commenters urged the FTC to establish particular standards that, for example, would establish a certification system.

161

Others, however, asserted this should not be the FTC’s role.

162

161

See

e.g.

, Builders Association of South Florida, Comment 536013-00010 at 1; Stephen Richard Sides, National Paint and Coatings Association, Inc. (“NPCA”), Green Building and Textiles Workshop Tr. at 128.

162

See

John Girman, EPA, Green Building and Textiles Workshop Tr. at 200-201; Carlos Martin, National Association of Home Builders (“NAHB”), Green Building and Textiles Workshop Tr. at 198-200.

3. Analysis and Guidance

Marketers across industry sectors increasingly use certifications and seals of approval to communicate environmental claims. These certifications vary from seals of approval issued by third-parties to logos developed internally pursuant to company-specific standards. Third-party certification programs include certification for single attributes (

e.g.

, “recycled content”) and multiple attributes, which may incorporate environmental considerations throughout the life cycle of the product.

Given the widespread use of certifications and seals and their potential for consumer confusion, the Commission proposes providing additional guidance, specifically in a new Guide section devoted to this subject.

163

This section emphasizes that third-party certifications and seals constitute endorsements covered by the Endorsement Guides.

164

This section also states that the use of a certification or seal by itself may imply a general environmental benefit claim. Because, as discussed above, such claims are so difficult to substantiate, this section further advises marketers not to use unqualified seals or certifications. Marketers should accompany seals or certifications with clear and prominent language limiting the general environmental benefit claim to the particular attribute or attributes for which they have substantiation. Finally, the section addresses the use of certifications as substantiation.

163

This proposed guidance can be found in 16 CFR 260.6.

164

16 CFR Part 255. The Endorsement Guides provide guidance on the non-deceptive use of endorsements in marketing and outline the parameters of endorsements that would be considered adequate substantiation for marketing claims.

a. Certifications and Seals as Endorsements

The proposed new section advises marketers that it is deceptive to misrepresent, directly or by implication, that a product, package, or service has been endorsed or certified by an independent, third-party organization. The proposed section states that third-party certifications are endorsements,

165

which should meet the criteria for endorsements set forth in the FTC’s Endorsement Guides. In particular, the proposed section advises marketers to review the following Endorsement Guides sections: Definitions,

166

General Considerations,

167

Expert Endorsements,

168

Disclosure of Material Connections,

169

and Endorsements by Organizations.

170

165

The Endorsement Guides define an endorsement as “any advertising message . . . that consumers are likely to believe reflects the opinions, beliefs, findings, or experiences of a party other than the sponsoring advertiser, even if the views expressed by that party are identical to those of the sponsoring advertiser.” 16 CFR 255.0.

166

Id.

167

16 CFR 255.1. This section provides, among other things, that “[e]ndorsements must reflect the honest opinions, findings, beliefs, or experience of the endorser,” and that the endorsement “may not convey any express or implied representation that would be deceptive if made directly by the advertiser.”

168

16 CFR 255.3. An expert endorser is someone who, as a result of experience, study, or training, possesses knowledge of a particular subject that is superior to that generally acquired by ordinary individuals. 16 CFR 255.0(e). An expert endorser’s qualification must, in fact, give him or her the expertise that he or she is represented as possessing with respect to the endorsement. 16 CFR 255.3(a). An expert endorsement must be supported by an actual exercise of expertise, and the expert’s evaluation of the product must have been at least as extensive as someone with the same degree of expertise would normally need to conduct in order to support the conclusions presented. 16 CFR 255.3(b).

169

16 CFR 255.5. When there is a connection between the endorser and the seller of the advertised product that might materially affect the weight or credibility of the endorsement (

i.e.

, the connection is not reasonably expected by the audience), such connection must be fully disclosed. 16 CFR 255.5.

170

16 CFR 255.4.

Rather than simply repeating the Endorsement Guides’ text, the proposed Green Guides section provides several examples of how the Endorsement Guides apply in the context of environmental claims. Proposed Example 1 addresses the use of a seal of approval created by the marketer itself, rather than bestowed by a third-party. In this example, the advertisement implies that an independent third-party certifier with appropriate expertise awarded the seal. The example notes that this unqualified claim would be deceptive because consumers would assume that an independent, third-party certifier

evaluated the product.

171

The marketer could avoid deception by using clear and prominent qualifying language to alert consumers that it created the certifying program.

171

See

16 CFR 255.0 (defining “endorsement” as a message which “consumers are likely to believe reflects the opinion . . . of a party

other than the sponsoring advertiser

”) (emphasis added); 16 CFR 255.5 (stating that when there is a connection between the endorser and the seller of the advertised product that might materially affect the weight or credibility of the endorsement, such connection must be fully disclosed);

see also Trade Advertising Assocs., Inc.

, 65 F.T.C. 650 (1964) (finding a newspaper’s statement about “awards” it won, which were, in fact, created by the publisher, deceptive because consumers were misled into believing that an objective third-party had evaluated the newspaper);

Revco D.S., Inc.

, 67 F.T.C. 1158 (1965) (finding an advertiser’s creation and use of a “Consumer Protective Institute” seal on products was deceptive because the seal created the false impression that “an independent and disinterested organization . . . had approved these products”).

Proposed Example 2 involves a marketer who displays a seal of approval bestowed by a trade association in which the marketer is a member. In this case, the trade association evaluated the environmental attributes of the marketer’s product. Because the seal of approval implies that a third-party evaluated and certified the product, consumers likely expect that the endorsing party is truly independent from the marketer. In this case, however, the certifier is not a truly independent entity because the marketer pays membership dues to the association. Under Section 5 of the FTC Act, as explained by the Endorsement Guides, marketers are required to disclose a “material connection,” or a “connection between the endorser and the seller of the advertised product that might materially affect the weight or credibility of the endorsement.”

172

Accordingly, this example makes clear that the marketer’s failure to disclose its material connection with the endorsing association,

i.e.

, that it is a dues-paying member of the endorsing association, is deceptive.

172

16 CFR 255.5.

Proposed Example 3 similarly illustrates a failure to disclose a material connection and shows how the name of a certifying organization can be misleading. In this example, the marketer is a member of an industry trade association, the American Institute of Degradable Materials, that evaluates the biodegradability of its members’ products. The association’s name may lead consumers to believe that the association is an independent certifying organization. Consumers likely place different weight on a certification from an industry association than from an independent, third-party. Because this advertisement does not disclose that the certifier is an industry trade association, the advertisement is likely to be deceptive. As shown in the example, the marketer could avoid this deception by disclosing that the American Institute of Degradable Materials is an industry trade association.

Unlike the examples above, proposed Example 4 addresses a situation in which a marketer touts its relationship with a third party that has neither evaluated nor endorsed the environmental attributes of its products. In this example, the marketer displays a seal to show that it is a member of the “U.S. EcoFriendly Building Association.” The proposed example makes clear that, in this circumstance, displaying the organization’s seal may cause consumers to mistakenly believe that the organization has evaluated and endorsed the product. In this example, the marketer could avoid deception by stating that the seal refers to the company’s membership only and that the association did not evaluate the product’s environmental attributes.

b. Certifications and Seals as General Environmental Benefit Claims

The current Green Guides state that unqualified certifications and seals of approval likely convey general environmental benefit claims. Specifically, Example 5 of the current general environmental benefit section states that a marketer using an unqualified seal of approval should be able to substantiate the broad claim that the product is environmentally superior to others.

173

If the marketer cannot, it should accompany the seal with “clear and prominent qualifying language limiting the environmental superiority representation to the particular product attribute or attributes for which they could be substantiated . . . .”

174

No commenters challenged this approach. Therefore, the Commission continues to believe that consumers likely interpret unqualified seals and certifications similarly to general environmental benefit claims.

175

173

16 CFR 260.7(a).

174

Id.

175

The Commission’s study did not test consumer interpretation of seals of approval or certifications. Given the wide diversity of seal and certification designs, it would have been difficult to draw general consumer perception conclusions from testing a particular seal design. No commenter submitted relevant consumer perception evidence.

As discussed in Part V.A, above, the Commission’s consumer perception study shows that broad, general environmental benefit claims suggest that a product has specific, unstated green attributes, such as recyclability and biodegradability, and that the product has no negative environmental impact. The study results also reinforce the Guides’ advice that marketers may be able to avoid making deceptive general environmental claims by qualifying those claims.

The Commission proposes transferring a modified Example 5 into the new certification section

176

and moving the guidance from this example into this section. Specifically, the guidance cautions marketers that unqualified seals of approval and certifications likely constitute general environmental benefit claims and, because marketers are unlikely to be able to substantiate such claims, they should not use unqualified certifications or seals of approval. The guidance further states that marketers should qualify seals of approval or certifications to prevent deception. Qualifying language should be clear and prominent and should convey that the seal of approval or certification applies only to a specific and limited benefit.

177

The Commission will consider whether the qualifying language successfully limits the general environmental benefit claim on a case-by-case basis.

176

This example is now Example 5 in the proposed new Section 260.6. The example now states that the environmental seal is likely to convey that the product has far-reaching environmental benefits and may also convey that it causes no negative environmental impact.

177

It is possible for this qualifying language to be part of the certification or seal itself. For example, the name of a seal may constitute all or part of the qualification.

See

proposed Examples 2 and 6.

In contrast, proposed Example 6 illustrates how a marketer can properly use a third-party certification for a single-attribute claim,

e.g.

, “chlorine-free.” In this example, the name of the certifier (“No Chlorine Products Association”) conveys that the certification applies only to one environmental attribute, rather than to the overall environmental benefit of the product.

c. Third-Party Certifications as Substantiation

Third-party certification may constitute adequate substantiation. Therefore, the following describes the Commission’s proposed guidance on the use of certifications to substantiate environmental claims, as well as the topics the Commission declines to address.

A marketer may rely on a third-party certification as all or part of its substantiation if the marketer ensures that the certification constitutes competent and reliable scientific evidence to support its claims. In other

words, a marketer relying on a certification as substantiation must ensure that the certification supports each of the marketer’s claims with tests, analyses, research, or studies that have been conducted and evaluated in an objective manner by qualified persons and are generally accepted in the profession to yield accurate and reliable results.

178

This evidence should be sufficient in quality and quantity based on standards generally accepted in the relevant scientific fields, when considered in light of the entire body of relevant and reliable scientific evidence, to substantiate that each of the claims is true. It is the marketer’s responsibility to ensure that the certification adequately substantiates its claims. The proposed Guides, therefore, remind marketers that simply possessing a third-party certification does not eliminate their obligation to ensure that they have substantiation for their claims, including all claims communicated by the certification.

178

16 CFR 260.5.

The Commission does not propose incorporating four suggestions raised by commenters. First, the Commission does not propose requiring marketers to obtain a third-party certification to substantiate their claims. Rather, Section 5 of the FTC Act gives marketers the flexibility to substantiate their claims with any competent and reliable scientific evidence.

179

Because the Guides interpret Section 5 as applied to environmental claims, requiring a third-party certification to substantiate claims is beyond the Guides’ purview.

179

See

Substantiation Policy Statement, 104 FTC at 840 (explaining that what constitutes a reasonable basis for claims depends on a number of factors);

see also

FTC, Dietary Supplements: An Advertising Guide for Industry (2001),

available at

(

http://www.ftc.gov/bcp/edu/pubs/business/adv/bus09.pdf

) (stating that “[t]he FTC will consider all forms of competent and reliable scientific research when evaluating substantiation”).

Second, the Commission does not propose establishing a particular certification system. The Green Guides do not establish environmental performance standards or identify environmentally preferable industry practices. Instead, the Guides’ purpose is to provide advice regarding consumer interpretation of environmental marketing claims so that marketers can avoid making false or misleading claims.

Third, the Commission declines to propose guidance on the development of third-party certification programs. Experts in the field are in the best position in a dynamic marketplace to determine how to establish certification programs to assess the environmental attributes of products. There may be multiple ways to develop standards that would constitute adequate substantiation,

i.e.

, substantiation that constitutes competent and reliable scientific evidence. Accordingly, the Commission will continue to evaluate the adequacy of a third-party certification as substantiation on a case-by-case basis.

Finally, the proposed, revised Guides do not provide that certifiers make their standards or any other criteria used to support their certifications public. Although Section 5 requires that marketers possess substantiation for their claims prior to making them, it does not require that marketers make their substantiation publicly available.

C. Degradable Claims

1. The Current Guides

The Guides state that an unqualified degradable claim should be substantiated with competent and reliable scientific evidence that the entire product or package will completely break down and return to nature within a reasonably short period of time after customary disposal.

180

The Guides also provide that degradable claims should be qualified to avoid consumer deception about: (1) the product or package’s ability to degrade in the environment where it is customarily disposed; and (2) the rate and extent of degradation. For example, the Guides discuss a trash bag labeled “degradable,” without qualification. The marketer relies on tests showing that the bag will degrade in the presence of water and oxygen. Because trash bags are customarily incinerated or buried in landfills that inhibit degradation by minimizing moisture and oxygen, the marketer lacks substantiation that the bags will degrade in a reasonably short period of time. Thus, the claim is deceptive.

181

180

16 CFR 260.7(b).

181

Id.

, Example 1. The FTC Staff’s Business Brochure provides additional guidance, noting that a “reasonably short period of time” depends on where the product is disposed. The brochure explains that in landfills, where most trash is taken, materials degrade very slowly and certain materials take decades to decompose. FTC Staff’s Business Brochure at 7.

The Commission has challenged degradability claims more than any other specific claim addressed by the Green Guides.

182

These cases were not based on products’ inability to degrade under any conditions, but rather on their inability to degrade in the manner consumers expect.

182

See

e.g.

Dyna-E Int’l, Inc., et al.

, FTC Docket No. D-9336 (Dec. 15, 2009) (viscose towels);

Kmart Corp.

, FTC Docket No. C-4263 (July 15, 2009) (paper plates);

Tender Corp.

, FTC Docket No. C-4261 (July 13, 2009) (moist wipes and plastic packaging).

2. Comments

Most commenters supported the Commission’s degradable claims guidance.

183

For example, the Soap and Detergent Association supported the Guides’ provision that “degradability claims should be qualified to the extent necessary to avoid consumer deception about the product’s ability to degrade in the environment where, or in the manner in which, it is customarily disposed.”

184

183

See

e.g.

, Biodegradable Products Institute (“BPI”), Comment 533431-00087 at 2 (supporting guidance, but proposing changes); EPA-EPPP, Comment 533431-00038 at 7; EPA-SPN, Comment 536013-00062 at 12; P&G, Comment 533431-00070 at 2.

184

SDA, Comment 533431-00020 at 3;

see also

ACC, Comment 533431-00023 at 12.

Although supporting the current guidance, commenters suggested four modifications. First, many stressed that typical solid waste disposal treatments inhibit degradation.

185

Procter & Gamble summed up these views, stating “[i]n the United States, solid waste is predominantly disposed of by incineration or in a landfill, where little or no degradation occurs.”

186

Consequently, these commenters argued that unqualified biodegradable claims are inappropriate for items destined for landfills and incinerators.

187

Second, several commenters recommended that the Commission provide guidance on the “reasonably short” time period for complete decomposition. For example, the Biodegradable Products Institute (“BPI”) urged that “[t]he FTC . . . cite a specific timeframe for the process.”

188

Third, several commenters suggested that the Commission reference technical protocols that marketers could follow to adequately substantiate degradable claims. These commenters did not form

a consensus, however, regarding which specific protocol(s) the Commission should consider.

189

Finally, the EPA’s Sustainable Products Network urged that the revised Guides address emerging “oxo-degradable” claims.

190

185

See

CSPA, Comment 533431-00049 at 3 (“Very little, if any, degradationoccurs when the product is incinerated or disposed of in a landfill.”); Georgia-Pacific, Comment 533431-00007 at 9 (“[M]odern landfills are in fact entombment facilities where air, light and water are excluded by strict design. In those conditions, degradability time far exceeds ‘the reasonable [sic] short period of time’ of the Guides.”); Tracy Artley, Comment 534743-00019 at 1; EHS, Comment 534743-00011 at 1; EPI, Comment 533431-00063 at 5; NAD, Comment 534743-00029 at 7; Tandus, Comment 533431-00021 at 1.

186

P&G, Comment 533431-00070 at 2.

187

No commenters specifically addressed disposal of liquid waste into wastewater treatment systems or aquatic environments.

188

BPI, Comment 533431-00087 at 3;

see also

GPI, Comment 534743-00026 at 7 (“[I]t is important that the Commission provide additional clarification regarding what constitutes a ‘reasonably short period of time.’”); Graphic Arts Coalition, Comment 533431-00060 at 1 (“The business community is now asking for a clearer definition of ‘short period of time.’”).

189

The following commenters favor some degree of reference to technical standards or testing protocols: ECM BioFilms, Comment 534743-00011 at 3 (ASTM D 5526 (plastics under accelerated landfill conditions)); EPA-SPN, Comment 536013-00062 at 12 (various harmonized tests accessible online from the EPA); EPI, Comment 533431-00063 at 4 (“the applicable [unspecified] ASTM or ISO standard”); Georgia-Pacific, Comment 533431-0007 at 9-10 (the British Standards Institution’s EN 14327:2000 (requirements for packaging and packaging waste) and ISO 14855:1999 (aerobic biodegradability of plastics)); SPI, Comment 533431-00036 at 8 (“existing [unspecified] ASTM standards”);

see also

Graphic Arts Coalition, Comment 533431-00060 at 1 (“The business community . . . oftentimes seeks a specific test method to verify the claims. Inclusion in the guides of acceptable test methods might be an appropriate step.”); Tandus, Comment 533431-00021 at 1 (“If a test method could be specified, it might help qualification of such claims.”).

190

EPA-SPN, Comment 536013-00062 at 12 (discussing degradable, biodegradable, oxo-degradable, and photodegradable claims).

3. Consumer Perception Evidence

The Commission solicited from commenters evidence of consumer understanding of degradable claims. Only BPI referenced detailed research findings, which arose from a September 2006 survey conducted by the opinion research firm APCO Insight for the American Chemistry Council (“APCO survey”).

FTC staff has subsequently reviewed the underlying questionnaire and data from the APCO survey.

191

Using a widely-accepted methodology, the survey asked 1,000 Americans about unqualified biodegradable and compostable claims.

192

It found that 60 percent of consumers believed that a biodegradable package will disappear in one year or less.

193

Additionally, 83 percent of consumers believed a biodegradable item will decompose even when disposed in a landfill.

194

The Commission is unaware of additional consumer perception data on degradable claims.

195

191

The Commission has placed this information on the public record.

192

The study did not explore other types of degradable claims, such as photodegradable.

193

See

APCO, Biodegradable and Compostable Survey Topline at 2.

194

Id.

at 1.

195

The Commission’s consumer perception study did not specifically ask consumers about unqualified biodegradable claims.

4. Analysis and Guidance

In light of the comments and the APCO survey, as well as our own enforcement experience, the Commission proposes retaining its guidance on degradable claims but adding clarity regarding degradable claims for solid waste.

196

Given the lack of information on the record about liquid waste, the Commission seeks comment on whether it should provide additional specificity concerning claims for such materials. The Commission declines to advise marketers that a particular test constitutes adequate substantiation for degradability claims. Finally, the Commission proposes addressing oxo-degradable claims in the Guides.

196

This proposed guidance can be found in 16 CFR 260.8.

a. Solid Waste - Time Period for Degradation

The Commission proposes revising the Guides to clarify that unqualified degradable claims are deceptive for products or packages destined for landfills, incinerators, or recycling facilities. Federal environmental regulations require landfills to minimize interaction with water, oxygen, and light.

197

Absent a robust supply of these elements, decomposition is severely retarded.

198

Moreover, incinerators combust materials at extreme temperatures, thereby completely preventing decomposition.

199

Together, landfills and incinerators received 66 percent of municipal solid waste in 2008.

200

In addition, in 2008, another 24 percent of consumers’ trash went to recycling facilities to be processed for reuse.

201

Thus, these materials also will not decompose. Accordingly, unqualified degradable claims for a vast majority of disposable solid items are likely to be deceptive because the customary methods of disposal do not present conditions for decomposition in a reasonably short period of time.

197

See

40 CFR Part 258.

198

EPA,

The Consumer’s Handbook for Reducing Solid Waste

, EPA Pub. 530-K-96-003, at 17 (1996); William Rathje and Cullen Murphy,

Rubbish! The Archaeology of Garbage

112 (2001).

199

See

National Research Council of the National Academy of Sciences,

Waste Incineration & Public Health

37 (2000).

200

EPA,

Municipal Solid Waste Generation, Recycling, and Disposal in the United States: Facts and Figures for 2008

at 2-3,

available at

(

http://www.epa.gov/waste/nonhaz/municipal/ pubs/msw2008rpt.pdf

201

Id.

For those solid waste products that are not disposed of in these traditional ways, some marketers seek more definite guidance regarding what constitutes a “reasonably short period of time.” The Commission, therefore, proposes the following two modifications to the Guides.

First, because the Guides do not currently illustrate a non-deceptive unqualified degradable claim for a solid item, the Commission proposes adding an example. Specifically, proposed new Example 5 describes a plant pot that, when buried in soil, quickly decomposes. This example illustrates that an unqualified degradable claim can be made non-deceptively about a solid item if the item is customarily disposed of in a manner that promotes total and rapid decomposition.

Second, the APCO survey found that 60 percent of consumers expect biodegradable solid waste to decompose in one year or less. Accordingly, the Commission proposes adopting a maximum period of one year for complete decomposition of solid materials marketed as degradable without time qualification. The Commission requests comment on whether this one-year period may lead to deceptive claims where consumers would expect a material to degrade in a much shorter time frame -

e.g.

, a plant pot decomposing fully in a single growing season.

b. Solid Waste - Substantiation

As discussed above, several commenters suggested that the Commission reference technical standards that marketers could follow to substantiate degradability claims.

202

Any technical protocol (or combination of protocols) must assure complete decomposition within one year and must replicate the physical conditions found in the relevant disposal environment (

e.g.

, in landfills, where most trash is disposed). Commission staff has not identified testing protocols that satisfy these needs.

203

Accordingly, the Commission does not propose creating a safe harbor for any particular technical standard.

202

The comments discussed numerous different standards. While no single protocol attracted wide support, the standards published by ASTM garnered the most mention.

203

Most trash is disposed in landfills, which have varied, highly compressed, heterogeneous zones. The moisture, temperature, and contact conditions in landfills differ from the laboratory protocols. ASTM D 5511, for example, mimics a rare disposal environment - a highly controlled anaerobic digester, such as may be found on farms or in sewage treatment systems - with consistent moisture, heat, and exposure to degradation catalysts.

c. Liquid Waste

The Commission received no comments concerning decomposition of liquids (or dissolvable solids) in wastewater or aquatic environments, and is unaware of consumer perception evidence relating to such degradable claims. Therefore, the Commission lacks sufficient information to give more

definitive guidance on the “reasonably short period of time” for degradability claims for liquids.

204

Accordingly, the Commission seeks consumer perception evidence regarding these degradable claims and requests comment on whether the Guides should specify a decomposition time period for liquid substances or dissolvable solids marketed without qualification.

204

Although one group of testing protocols for biodegradability in water emphasizes a 28-day period for “ready biodegradability,” these tests do not appear to ensure the complete decomposition of the substance. EPA Office of Prevention, Pesticides and Toxic Substances, 835.3110 Ready Biodegradability Guideline, Pub. EPA 712-C-98-076 (1998),

available at

(

http://www.epa.gov/opptsfrs/publications/OPPTS_Harmonized/835_Fate_Transport_and_Transformation_Test_Guidelines/Series/835-3110.pdf

d. Emerging Oxo-degradable Claims

The EPA’s Sustainable Products Network urged the Commission to include guidance concerning emerging degradable claims - “oxo-degradable” and “oxo-biodegradable.”

205

Claims relating to purported oxo-degradability have entered the marketplace in connection with some of the same disposable items,

e.g.

, bottles and bags, that have featured other degradable claims.

206

According to relevant trade associations, the technology behind these claims depends upon a catalyst, typically light or oxygen, to commence and sustain the decomposition process.

207

However, as discussed above, these elements are lacking in customary methods of disposal. Although commenters did not provide any consumer perception evidence relating to oxo-degradable claims, it is likely consumers would understand these claims similarly to other degradable claims.

208

Therefore, the Commission proposes treating oxo-degradable and oxo-biodegradable claims like all other degradable claims.

209

205

EPA-SPN, Comment 536013-00062 at 6, 12.

206

See

e.g.

The recession: packaging fights back

, Packaging Today, Feb. 2009, at 32 (oxo-degradable bottle);

Print Media: Footprints with a lighter touch

, Marketing Week, Mar. 27, 2008, at 23 (oxo-biodegradable bag).

207

OxoBiodegradable Plastics Institute, Frequently Asked Question 11, (

http://www.oxobio.org/faq.htm#q4

) (“Heat and/or sunlight are required to initiate degradation and there has to be oxygen present.”); BPI, Background on Biodegradable Additives (Mar. 18, 2009) at 1 (“Oxo-biodegradables . . . theoretically foster oxidation and chain scission in plastics when exposed to heat, air and/or light.”).

208

The root word, degradable, is identical; consequently, consumers’ basic intuition about decomposition after customary disposal is likely to be the same, regardless of prefixes such as bio-, photo-, or oxo-. The National Advertising Division also found that oxo-biodegradable is similar to degradable. With respect to bags marketed as “100% oxo-biodegradable,” NAD recommended that the marketer discontinue the claim “and otherwise modify its advertising to avoid conveying the message that PolyGreen bags will quickly or completely biodegrade when disposed of through ‘ordinary channels,’

e.g.

, when placed in a landfill.” NAD Press Release Regarding GP Plastics Corp.’s PolyGreen Plastic Bags (Mar. 9, 2009).

209

For the purposes of interpreting and applying revised Section 260.8, the FTC considers the term “degradable” to include all variants, such as biodegradable, photodegradable, oxo-degradable, and oxo-biodegradable. Thus, degradable claims include any and all of the foregoing.

D. Compostable Claims

1. The Current Guides

Currently, the Guides advise marketers to substantiate compostable claims with competent and reliable scientific evidence demonstrating that “all of the materials in the product or package will break down into, or otherwise become a part of, usable compost (

e.g.

, soil-conditioning material, mulch) in a safe and timely manner in an appropriate composting program or facility, or in a home compost pile or device.”

210

Further, the Guides advise marketers to qualify compostable claims “to the extent necessary” to avoid consumer deception. For instance, they state: “A claim that a product is compostable in a municipal or institutional composting facility may need to be qualified” to alert consumers to any “limited availability of such composting facilities.”

210

16 CFR 260.7(c).

The Guides provide six examples illustrating this guidance, including several relating to the limited availability of large-scale composting facilities. For instance, Example 4 discusses a product designed to be composted only in yard trimmings composting programs but merely labeled “compostable.” Such yard trimmings programs are not available to a substantial majority of consumers or communities where that particular product is sold. Consequently, the claim is deceptive, but could be corrected with a clear and prominent disclosure indicating the limited availability of such programs.

2. Comments

The comments on this issue were extremely limited. Some commenters suggested that the Guides state that two ASTM tests, specifications D 6400 and D 6868, constitute adequate substantiation for compostable claims.

211

BPI, Comment 533431-00087 at 4; EPA-EPPP, Comment 533431-00038 at 8; EPA-SPN, Comment 536013-00062 at 13;

see also

Earthcycle Packaging Ltd., Comment 534743-00005 at 1.

3. Consumer Perception Evidence

As discussed above, the Biodegradable Products Institute submitted a consumer research study conducted by APCO concerning degradable and compostable claims. According to this study, 62 percent of consumers said they do not have access, and an additional 28 percent do not know if they have access, to large-scale composting facilities.

212

Nevertheless, 43 percent of consumers interpreted an unqualified compostable claim to mean that a large-scale composting facility is available in their area.

213

The study also found that 71 percent of consumers believed that a package labeled “compostable” would decompose in a home compost pile or device.

214

212

See

APCO, Biodegradable and Compostable Survey Topline at 9.

213

Id.

at 8.

214

Id.

at 6.

4. Analysis and Guidance

The Commission’s current compostable guidance is consistent with consumer perception data from the APCO survey. As discussed below, the Commission does not propose adding references to ASTM’s compostability tests to the Guides but proposes including advice concerning the “timely manner” of compost production.

215

This proposed guidance can be found in 16 CFR 260.7.

a. Limited Availability of Composting Facilities

Large-scale composting facilities, particularly those taking feedstocks other than yard trimmings (

e.g.

, leaves and grass), are still uncommon in the United States.

216

Unsurprisingly, 90 percent of consumers in the APCO survey reported having no access, or being unaware of access, to such facilities. Nevertheless, 43 percent interpreted an unqualified compostable claim to mean that such facilities are available in their area.

216

See Food Composting Infrastructure

, BioCycle, Dec. 2008, at 30 (noting that in 2008, only 92 commercial composters and 39 municipal composters provided food waste composting); EPA,

Municipal Solid Waste in the United States: 2007 Facts and Figures

at 148,

available at

(

http://www.epa.gov/epawaste/nonhaz/municipal/pubs/msw07-rpt.pdf

) (“In 2007, there were 16 mixed waste composting facilities, two more than in 2006.”).

In light of the persistent scarcity of municipal facilities and many consumers’ mistaken belief about their availability, the Commission proposes retaining its advice that marketers qualify their compostable claims to avoid deception about the limited availability of composting facilities.

217

Example 4 in the current Guides explains that this disclosure is needed when facilities “are not available to a substantial majority of consumers or communities.”

218

It does not, however, specify what proportion of consumers constitutes a substantial majority. As discussed below in the recyclable section, staff informally has interpreted “substantial majority” in the recycling context to mean at least 60 percent.

219

217

Example 4 in the current Guides suggests an effective qualification that would convey the

scarcity of large-scale facilities,

e.g.

, “Appropriate facilities may not exist in your area.” 16 CFR 260.7(c), Example 4.

218

Id.

219

See

Part V.E,

infra

b. Substantiating Compostable Claims

Three commenters suggested that the Guides reference two laboratory protocols adopted by ASTM: (1) Standard specification D 6400 for compostable plastics; and (2) Standard specification D 6868 for biodegradable plastics used as coatings. The commenters, however, did not explain why these protocols would substantiate compostable claims and thereby meet consumers’ expectations about compostable products. Based upon a review of the protocols’ methodology, the Commission does not propose referencing these protocols in the Guides.

ASTM created D 6400 and D 6868 in response to manufacturers’ increased production of plant-based plastic resins.

220

Marketers of these plant-based materials desired to contrast them with petroleum-based plastics and advertise them as “compostable.”

221

ASTM provides that a plastic item should be considered compostable if the item sufficiently converts to carbon dioxide under these protocols’ specific laboratory conditions.

222

220

See

Rhodes Yepsen,

Compostable Products Go Mainstream

, BioCycle, July 2009, at 25.

221

See id.

; Susan Moran,

The New Bioplastics, More Than Just Forks

, N.Y. Times, Mar. 7, 2007.

222

See

ASTM D 6400 - 04 at § 4; ASTM D 6868 - 03 at § 4. These two protocols incorporate a third ASTM protocol, D 5338, a detailed test method for plastics disposed of in large-scale composting facilities.

These protocols, however, have significant limitations. As a threshold matter, they apply to materials discarded only in scarce large-scale composting facilities, not home compost piles or devices.

223

Moreover, the laboratory procedures ignore “wide variation” in actual composting facility operations, simulating instead “optimum conditions.”

224

223

See

ASTM D 6400 at § 1.1; ASTM D 6868 at § 1.1.

224

See

ASTM D 5338 - 98 (Reapproved 2003) at § 5.2 (“Because there is a wide variation in the construction and operation of composting systems and because regulatory requirements for composting systems vary, this procedure is not intended to simulate the environment of any particular composting system. However, it is expected to resemble the environment of a composting process operated under optimum conditions.”). One example of such an optimum condition is the testing of only a small piece of the subject material - a two-centimeter scrap - rather than full-size plastic feedstock wast

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