I also looked into advertising laws to see if there were any restrictions to what content should be published and if there any specific laws.
1. Section 5 of the Federal Trade Commission Act:
You should be aware that the Federal Trade Commission Act provides a comprehensive framework that enables FTC to carry out its law enforcement initiatives. Under Section 5 of the FTC Act (15 U.S.C. Section 45(a)(1), “unfair or deceptive acts or practices in or affecting commerce, are hereby declared unlawful”. FTC relies on Section 5 and on other more specific consumer protection laws in carrying out its mission. Advertising a product or service certainly fits under this category. Under Section 5, FTC will find that a representation, omission, or practice is deceptive if it’s:
- likely to mislead consumers acting reasonably under the circumstances; and
- material, that is, likely to affect consumers’ conduct or decisions with respect to the product at issue.
In August 1994, Congress amended Section 5 of the FTC Act to provide that an act or practice is unfair if the injury it causes or is likely to cause to consumers is:
- not outweighed by countervailing benefits to consumers or to competition; and
- not reasonably avoidable by consumers themselves.
The remainder of this article tells you about some of the other more specific consumer protection statutes that nevertheless may affect your advertising and/or marketing.
2. Telemarketing and Consumer Fraud and Abuse Prevention Act
The Telemarketing and Consumer Fraud and Abuse Prevention Act requires FTC to promulgate regulations:
- defining and prohibiting deceptive telemarketing acts or practices;
- prohibiting telemarketers from engaging in a pattern of unsolicited telephone calls that a reasonable consumer would consider coercive or an invasion of privacy;
- restricting the hours of the day and night when unsolicited telephone calls may be made to consumers; and
- requiring disclosure of the nature of the call at the start of an unsolicited call made to sell goods or services.
The law expressly authorizes FTC to include within the rules’ coverage entities that “assist or facilitate” deceptive telemarketing practices.
3. Telephone Disclosure and Dispute Resolution Act of 1992
The Telephone Disclosure and Dispute Resolution Act of 1992 requires FTC to promulgate regulations concerning advertising for, operation of, and billing and collection procedures for, pay-per-call or “900 number” telephone services. The regulations must include certain provisions, such as price disclosure requirements, mandatory warnings on services directed to children, and required disclosures in billing statements. The Act also directs FTC to promulgate a regulation extending to pay-per-call services the billing dispute provisions of the Fair Credit Billing Act, 15 U.S.C. Section 1666 et seq.
4. Do-Not-Call Registry Act of 2003
The Do-Not-Call Registry Act of 2003 authorized FTC under section 3(a)(3)(A) of the Telemarketing and Consumer Fraud and Abuse Prevention Act, 15 U.S.C. Section 6102(a)(3)(A), to implement and enforce a do-not-call registry. The Act also ratified the do-not-call registry provision of FTC’s Telemarketing Sales Rule, 16 C.F.R. 310.4(b)(1)(iii), which became effective on March 31, 2003.
5. Do-Not-Call Implementation Act
The Do-Not-Call Implementation Act authorizes FTC to collect fees to implement and enforce a do-not-call registry. The Act allows fees to be collected for fiscal years 2003 through 2007. The Act further requires the Federal Communications Commission (FCC) to issue a compatible do-not-call registry rule and directs FTC and FCC to submit an annual report on the registry to the House Committee on Energy and Commerce and the Senate Committee on Commerce, Science, and Transportation for fiscal years 2003 through 2007.
6. Federal Cigarette Labeling and Advertising Act of 1966
The Federal Cigarette Labeling and Advertising Act of 1966 requires FTC to submit annual reports to Congress as to:
- (a) the effectiveness of cigarette labeling,
- (b) current practices and methods of cigarette advertising and promotion, and
- (c) recommendations for legislation.
The statute was amended by the Comprehensive Smoking Education Act of 1986 (Pub. L. No. 98-474, 98 Stat. 2200), which establishes the text of four health-related warning labels and requires that cigarette packages and advertisements carry these warnings on a rotating basis.
7. Comprehensive Smokeless Tobacco Health Education Act of 1986
The Comprehensive Smokeless Tobacco Health Education Act of 1986:
- Requires manufacturers, packagers, and importers of smokeless tobacco products to place one of three statutorily prescribed health warning labels on product packages and in advertisements,
- Bars advertising of smokeless tobacco products on radio and TV.
- Directs FTC to require that the label warnings be displayed on a rotating basis, and that they be placed conspicuously on smokeless tobacco packages and in advertisements.
8. CAN-SPAM Act
The CAN-SPAM Act establishes requirements for those who send unsolicited commercial email. The Act bans false or misleading header information and prohibits deceptive subject lines. It also requires that unsolicited commercial email provide recipients with a method for opting out of receiving such email and must be identified as an advertisement. In addition to enforcing the statute, FTC must issue rules involving the required labeling of sexually explicit commercial emailand the criteria for determining the primary purpose of a commercial email. The Act also instructs FTC to report to Congress on the feasibility of a National Do-Not-E-Mail Registry, as well as requiring reports on the labeling of all unsolicited commercial email, the creation of a “bounty system” to promote enforcement of the law, and the effectiveness and enforcement of the statute.
9. Wool Products Labeling Act
Under the Wool Products Labeling Act, the manufacture, introduction, sale, transportation, distribution, or importation of misbranded wool is a violation of the FTC Act. The Act was amended, by the Drug Price Competition and Patent Term Restoration Act of 1984, Pub. L. No. 98-417, Section 301-307, 98 Stat. 1585, 1603, to require that:
- wool product labels indicate the country in which the product was processed or manufactured, and
- mail order promotional materials clearly and conspicuously state whether a wool product was processed or manufactured in the United States or was imported.
10. Textile Fiber Products Identification Act
The Textile Fiber Products Identification Act deals with mandatory content disclosure in the labeling, invoicing, and advertising of textile fiber products. Under the Act, misbranding is unlawful, as is falsely or deceptively invoicing or advertising textile fiber products. The Act also directs the Commission to establish a generic name for each man-made fiber that does not as yet have such a name.
The statute was amended by the Drug Price Competition and Patent Term Restoration Act of 1984 (Pub. L. No. 98-417) to require (1) that any textile fiber product processed or manufactured in the United States be so identified, and (2) that mail order promotional materials clearly and conspicuously indicate whether a textile fiber product was processed or manufactured in the United States or was imported.
11. Fair Packaging and Labeling Act
The Fair Packaging and Labeling Act directs FTC to issue regulations requiring that all consumercommodities other than food, drugs, therapeutic devices, and cosmetics be labeled to disclose net contents, identity of commodity, and name and place of business of the product’s manufacturer, packer, or distributor. The Act authorizes additional regulations where necessary to prevent consumer deception (or to facilitate value comparisons) with respect to descriptions of ingredients, slack fill of packages, use of “cents-off” or lower price labeling, or characterization of package sizes.
12. Fur Products Labeling Act
The Fur Products Labeling Act requires that articles of apparel made of fur be labeled, and that invoices and advertising for furs and fur products specify, among other things, the true English name of the animal from which the fur was taken, and whether the fur is dyed or used. The Act also requires FTC to issue a Fur Product Name Guide.
*John Lichtenberger is the Publisher of Advertising Compliance Service, a vital advertising law reference service since 1981 for attorneys and advertisers.
All marketing and advertising must be:
- an accurate description of the product or service
- socially responsible (not encouraging illegal, unsafe or anti-social behaviour)
There are regulations that restrict what advertisers can and can’t do.
As well as the regulations, there are 2 advertising codes of practice that you need to follow to help you advertise legally.
You must describe your product or service accurately.
Requirements for specific products
There are also specific requirements that apply to certain sectors, such as:
- beauty products
- environmentally friendly products
For example, you can only claim your drink is ‘low in alcohol’ if it contains between 0.5% and 1.2% alcohol by volume.
If you’re gathering, storing or using information about customers or potential customers, you must also protect their data.
2. Regulations that affect advertising
Advertising to consumers
The Consumer Protection from Unfair Trading Regulations mean you can’t mislead or harass consumers by, for example:
- including false or deceptive messages
- leaving out important information
- using aggressive sales techniques
Read ‘The consumer protection from unfair trading regulations’ for the rules on advertising legally.
Advertising to businesses
Advertising to businesses is covered by the Business Protection from Misleading Marketing Regulations. As well as being accurate and honest, you must not make misleading comparisons with competitors, that includes:
- using a competitor’s logo or trademark, or something very similar
- comparing your product with a competitor’s product that’s not the same
Download ‘The Business Protection from Misleading Marketing Regulations 2008’ for more detail about the regulations that cover advertising to businesses.
If you break the regulations, you could be reported to a local Trading Standards office. You could be fined, prosecuted or imprisoned.
3. Advertising codes of practice
There are 2 advertising codes of practice that describe how businesses should advertise.
They cover all kinds of promotional communications, depending where the advert or promotion will appear.
The CAP non-broadcast code has rules that cover non-broadcast advertising (for example print, online), sales promotion and direct marketing (such as telesales and email).
The code specifies standards for accuracy and honesty that businesses must stick to, including specific conditions, such as:
- advertising to children
- causing offence
- political advertising
Broadcast media (for example TV, radio)
You must follow the CAP broadcast code, which covers issues including taste, decency and product placement.
As well as setting standards about accuracy and honesty businesses must stick to, they also have rules about things like scheduling.
General broadcasting rules
You also need to follow rules about taste, decency, product placement etc that apply to all broadcasting.
These are called ‘broadcast codes’. Find out more about them on the Ofcom website.
Enforcing the rules
The rules are enforced by the Advertising Standards Authority (ASA).
Anyone who thinks advertising rules have been broken can complain to the ASA within 3 months of the advert appearing.
If an advert breaks the rules, it may be withdrawn. If the product doesn’t match the description or the advert breaks the law, you could be prosecuted.
4. Describing your product
You must describe your product accurately. This means if you make a claim about your product, you must be able to prove what you say.
Your adverts must describe the actual cost accurately, including any ongoing or associated costs (like subscription fees) and taxes (such as VAT).
ExampleA customer pays £50 a product, without being told the price doesn’t include VAT. This was not explained in the advert, so the advert is misleading.
5. Direct marketing
You must check if customers want to be contacted by fax, phone, post or email, and give them the chance to object.
When you collect customer details, you must get their permission if you want to send them other offers or promotions.
You must also ask for their permission if you want to share their information with another organisation.
Letting customers opt out
Customers have the right to stop their information being used for direct marketing.
You must make it easy to opt out – for example by sending a ‘STOP’ text to a short number, or using an ‘unsubscribe’ link.
Telesales and fax marketing
You must say who you are when you make a telesales call, and give your address or phone number if you’re asked for it. The number for customers to call must be a freephone number.
You’re not allowed to send marketing faxes to individuals unless you’ve received their prior permission, but you can send unsolicited faxes to companies.
You must check that you’re not contacting anyone who’s asked not to receive these calls or faxes, using the:
It’s illegal to phone or fax someone registered with these services if you don’t have their permission. You can be fined £5,000 for each unsolicited phonecall.
If you want to make automated calls – with pre-recorded phone messages – you must get the permission of the individual or business first.
Check that your mailing lists don’t include anyone who’s asked not to receive direct mailing, using the Mail Preference Service.
Email marketing and text messages
You’re only allowed to send marketing emails to individual customers if they’ve given you permission.
Emails or text messages must clearly indicate:
- who you are
- that you’re selling something
- what the promotions are, and any conditions
Check that you aren’t sending emails to anyone who’s asked not to receive them, using the Email Preference Service.
If you buy or rent a mailing list, ask the supplier if you have the right to use it for email marketing.
Every marketing email you send must give the person the ability to opt out of (or ‘unsubscribe from’) further emails.
The information should be easy to understand.