Consumer demand for environmentally friendly products has increased dramatically in the past decade. This is especially true for those of us in Florida, a state known for its natural beauty and unique ecosystems. More than ever people are placing a greater importance on non-toxic products that are environmentally friendly, safe to use, and biodegradable. As a response, more businesses have started making green claims on their product labels and advertising campaigns. Not only is this a good way to attract more customers, but it can boost your business’s reputation too.
A green claim is a statement or illustration suggesting that a product is good for the environment in some way. Green claims might include a product being non-toxic, biodegradable, made from recycled materials, recyclable, or carbon neutral.
But what legal restrictions are involved when a business advertises or brands their product as environmentally friendly? This guide will explain the conditions that your small business needs to meet to make green claims.
General Principles for Green Claims by Businesses
If your small business is making green claims about a product in an advertisement, it will be subject to regulation by the Federal Trade Commission (FTC). The FTC guidelines can be found in their Guides for the Use of Environmental Marketing Claims (Green Guides). These guides provide direction for how businesses should act when making explicit and implicit claims about their products. The general principles are as follows:
• All green claims must be true and factually substantiated. Environmental claims should be backed by scientific evidence. • The FTC will determine if a claim is deceptive by interpreting the claims through the eyes of the reasonable consumer. • Claims must specify if they are referring to just the product or the product and packaging. • Any claims must be clearly visible and easy to understand. • Advertisers must not exaggerate the environmental benefits of their product.
In simple terms, your small business should only make claims that are true, accurate, and backed up with empirical evidence. In many cases, consulting a lawyer can be helpful when making these carefully worded claims, because even an honest mistake can jeopardize your business.
Making Specific Green Claims
In addition to the general principles outlined above, there are guidelines for making specific types of green claims.
Claiming a Product is “Environmentally Friendly” It is very common for businesses to advertise, label, or otherwise name their product in a way that makes people think that it is environmentally friendly.
Even though these claims can be vague, the FTC requires businesses to substantiate them. Businesses must list the reasons why their product is environmentally or earth friendly. For example, your business could state a product is “Environmental friendly: packaging contains less 40% plastic than before”. The explanation must be clear and prominent.
Consumers are often concerned about what happens to a product and its packaging once they have discarded it,especially when it comes to the effect of plastics and toxic ingredients on the environment. The damage such substances can cause is all too obvious to us Floridians, as many of us have seen first hand how plastic rings can snare and kill local wildlife.
This has led to many businesses adding biodegradable claims to their product’s packaging and advertising material.
It’s important for businesses to be very careful when making biodegradable or other degradable claims. The FTC has taken a hardline approach against such assertions. Biodegradable claims should not be made unless the product and packaging can completely break down and decompose into elements found within nature in a short period of time — usually less than a year.
One problem with this strict interpretation is the time that it takes for a product to biodegrade can vary greatly depending on the conditions in which it is placed. Something buried deep inside a landfill may take much longer to biodegrade than had it been left on the side of the road. Other commodities may not biodegrade very quickly if placed into a home compost system. If your product will only biodegrade under certain conditions, list them clearly on the label.
Because biodegradable claims are so strictly enforced, you should consult with a lawyer before making this green claim.
Recyclable Claims If your product can’t biodegrade within a short period, you may still be able to claim that it is recyclable. A product can be marked as recyclable if it can be “collected, separated, or otherwise recovered from the waste stream through an established recycling program for reuse or use in manufacturing or assembling another item.”
The product must be recyclable with technology available in at least 60% of the locations where the product is sold. If your product is more difficult to recycle, any recyclable claims must be qualified on the packaging. If only a portion of the product can be recycled, that must also be mentioned on the packaging.
Recycled Content Claims
Many businesses have starting using recycled materials in their product’s packaging. To make this green claim, the packaging must be made from materials that were prevented from entering the waste stream after they were used by a consumer.
If the product’s packaging used recycled materials that were not used by a consumer, this must be made clear on the packaging. If only a portion of the materials used are recycled, this must also be mentioned.
Seals of Approval and Certifications
Businesses are free to add independent third-party or internally developed seals and certifications to their products. However, any seals that make a green claim must be backed up by evidence. Simply referring a consumer to a website is not enough — evidence that backs up the claim must be featured in the product’s labelling or advertisement.
Free-of and Non-Toxic Claims
Many businesses want to emphasize the fact that their product is free of toxic ingredients or other polluting agents. You can make these claims as long as both the product and the packaging are free of the ingredient.
Carbon Offset Claims
Consumers are very aware of the impact that carbon emissions have on the environment. As a result, they often look for products which offset the carbon emissions released during production and shipping.
The FTC has slightly more complex rules when it comes to claiming carbon offsets. Your business can only use offsets that have been substantiated by competent and reliable scientific and accounting evidence. The offset can’t be sold more than once, and it must offset soon-to-be-released or current emissions. Because the standard is so high when making carbon offset claims, obtaining advice from a local lawyer who specializes in green claims is advised.
Making Green Claims Checklist
If you have decided to make a green claim on your product’s labelling or in an advertisement, keep the following in mind:
• Review all aspects of your advertisement including the text and imagery to determine if you are inadvertently making green claims. • Confirm substantiation for all your claims. This substantiation may have to include scientific evidence, testing results, and research. • Be specific about which parts of the product and packaging that the claims relate to. • If you must qualify a green claim, make sure it is clear and prominent. • Make sure that any green claims are not exaggerated. • Avoid terms like “Earth Friendly” which implies that the product is environmentally friendly. • Be extremely careful when making claims relating to carbon offsets.
To ensure that your green claims are legal, hire a lawyer who specializes in this area. The right business lawyer can not only help clear the path of any unforeseen obstacles, but also set you on your way to becoming a leader in your field as well as environmental sustainability.
Thank you for reading our Guide for Florida Businesses Making Green Claims. If you have any questions about making green claims, contact FL Patel Law PLLC at (727) 279-5037.Your dedication to sustainability is our passion.
Tyler Thompson is a second generation St. Petersburgian with a passion for reading and writing. In 2018 he finally made his way to FL Patel Law PLLC where he has found a home for himself as Project Manager. He is an unapologetic dog person who enjoys spending what free time he has with his friends and family.
About us and this blog
This our small business law blog. We provide information about Florida business law, LLC's, C-Corporations, S-Corporations, contracts, and provide resources for small businesses.
If you have a question about starting your business, want to discuss a contract, or would like counsel on a specific matter please do not hesitate to contact us. We provide a free 30 minute consultation for all new clients.