F.T.C. Issues Guidelines for ‘Eco-Friendly’ Labels

Environment Friendly Living

Commission officials said they did not intend to discourage companies from emphasizing their legitimate claims to environmental benefits or commitments to sustainable practices.

“Most marketers are honest,” Jon Leibowitz, the chairman of the Federal Trade Commission, said in a news conference Monday to announce the new guidelines. “They are not in the business of lying to consumers. But what we need is a little more clarity.”

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The Green Guides do not cover some other familiar environmental labels used by companies, however, including claims of being organic, sustainable or natural. In the case of sustainable or natural, the commission said it did not have enough basis to define and substantiate those claims. Sustainable, for example, could mean that a product was durable as well as refer to how it was made.

The organic label already is subject to regulations set by the Department of Agriculture.

The Federal Trade Commission guidelines prescribe some specific attributes. For a company to say a product is biodegradable, it must “completely break down and return to nature” within one year. That means no products destined for landfills, incinerators or recycling facilities can make such a claim.

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Similarly, saying that a product is green because it is made with recycled content could be deceptive if the environmental costs of creating and using the recycled material exceed the benefits of using it.

As a result, the guidelines include a tougher-than-expected requirement under which companies must do a sort of trade-off analysis, verifying, for example, that the environmental damage caused by long-distance shipping does not outweigh the benefits of importing recycled material.

“Every marketer ought to be looking at them carefully,” said Christopher A. Cole, a partner in the advertising and marketing practice at the law firm Manatt, Phelps & Phillips. “These are not laws, but they are guidance. You ignore them at your peril.”

Mr. Cole added he thought that the commission, which is responsible for enforcing Truth in Advertising laws, will increase its enforcement efforts in the environmental field, now that it has finished updating the rules.

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The commission also warned about the use of certifications and seals that supposedly document a product’s claims to being green. Because those seals are likely to convey general environmental benefits, they must clearly state exactly what claim the company is making.

Companies must also disclose any material connections that they have to the certifying organization, the commission said. But Mr. Cole said that the final guideline was a little looser than originally proposed, in that it allows certifications from trade groups in which a company is a member as long as the process in developing the seal is open and transparent.

More than 430 eco-labels are in use worldwide, according to

Ecolabel Index

, roughly a quarter of those in North America.


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