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Friday, October 08, 2010, 2:20 PM

FTC Releases Proposed Updates To "Green Guides"

Authored by: Jason Hicks
On October 6, 2010, the Federal Trade Commission released proposed revisions to the guidance it gives marketers to help them avoid making misleading environmental claims -- called the "Green Guides." The original Green Guides were introduced in 1998 and have not been updated since. Over the past 12 years, green marketing claims have increased dramatically, new environmental marketing terms have emerged, and concerns about greenwashing have grown.

“In recent years, businesses have increasingly used ‘green’ marketing to capture consumers’ attention and move Americans toward a more environmentally friendly future. But what companies think green claims mean and what consumers really understand are sometimes two different things,” said FTC Chairman Jon Leibowitz. “The proposed updates to the Green Guides will help businesses better align their product claims with consumer expectations.”

The changes to the “Green Guides” include new guidance on marketers’ use of product certifications and seals of approval, “renewable energy” claims, “renewable materials” claims, and “carbon offset” claims.

The FTC's press release also states:
The revised Guides caution marketers not to make blanket, general claims that a product is “environmentally friendly” or “eco-friendly” because the FTC’s consumer perception study confirms that such claims are likely to suggest that the product has specific and far-reaching environmental benefits. Very few products, if any, have all the attributes consumers seem to perceive from such claims, making these claims nearly impossible to substantiate.

Along with the 229-page text of the proposed revisions, the FTC also published a two-page Green Guide's Summary of Proposal and a webiste which contains links to additional information. The FTC is accepting comments on its proposed revisions to the Green Guides through December 10, 2010.

Womble Carlyle frequently advises clients on how to comply with advertising laws and regulations. Womble Carlyle also has assembled a green practices team to provide experienced knowledgeable guidance to businesses looking to "go green."

Tuesday, October 05, 2010, 3:31 PM

Antitrust and Credit Card Steering

Authored by: Jason Hicks
The Department of Justice filed a civil antitrust suit against Visa, Master Card and American Express challenging their policies that prohibit merchants from steering customers to other forms of payment. Credit card companies earn fees from credit card transactions, and these transaction fees are higher on some types of cards than others. (Typically, reward cards charge higher fees). Visa, MasterCard and American Express prohibited merchants from offering discounts to customers who use a cheaper type of credit card (i.e. one with less transaction fees). The Justice Department claims that these restraints prevent "merchants from freely promoting interbrand competition among [credit card] networks by offering customers discounts, other benefits, or information to encourage them to use a less-expensive [credit card] or other payment method."

Visa and Mastercard hare already entered into a settlement agreement with the Department of Justice and have agreed not to prohibit merchants from offering discounts or otherwise steering customers to less expensive types of payment methods.

American Express, who usually charges higher transaction fees, however, vows to fight the DOJ's charges and claims that the settlement agreement gives more market power to Visa and Mastercard because they will be able to steer customers away from American Express. The Wall Street Journal quotes American Express's CEO as saying: "We are confident that courts will recognize the perverse anticompetitive nature of the government's case and that we will continue providing a competitive, superior service to card members and merchants."

Attorney General Eric Holder responded: "Because American Express has refused to change its rules, consumers are being held hostage from receiving the expanded choices and lower prices that they deserve under our settlement. We cannot allow this to stand."
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