[Federal Register Volume 74, Number 90 (Tuesday, May 12, 2009)]
[Notices]
[Pages 22396-22399]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-11019]



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Part V





Federal Trade Commission





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Agency Information Collection Activities; Submission for OMB Review; 
Comment Request; Notice

  Federal Register / Vol. 74, No. 90 / Tuesday, May 12, 2009 / 
Notices  

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FEDERAL TRADE COMMISSION


Agency Information Collection Activities; Submission for OMB 
Review; Comment Request

AGENCY: Federal Trade Commission (``Commission'' or ``FTC'').

ACTION: Notice.

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SUMMARY: The FTC plans to conduct a study to examine consumer 
perception of environmental marketing claims. The study is part of the 
Commission's regulatory review of the Guides for the Use of 
Environmental Marketing Claims (``Green Guides'' or ``Guides''). This 
is the second of two notices required under the Paperwork Reduction Act 
(``PRA'') in which the FTC seeks public comments on its proposed 
consumer research before requesting Office of Management and Budget 
(``OMB'') review of, and clearance for, the collection of information 
discussed herein.

DATES: Comments must be received on or before June 11, 2009.

ADDRESSES: Interested parties are invited to submit written comments 
electronically or in paper form. Comments should refer to ``Green 
Marketing Consumer Perception Study, Project No. P954501'' to 
facilitate the organization of comments. Please note that your 
comment--including your name and your state--will be placed on the 
public record of this proceeding, including on the publicly accessible 
FTC Website, at (http://www.ftc.gov/os/publiccomments.shtm).
    Because comments will be made public, they should not include any 
sensitive personal information, such as an individual's Social Security 
Number; date of birth; driver's license number or other state 
identification number, or foreign country equivalent; passport number; 
financial account number; or credit or debit card number. Comments also 
should not include any sensitive health information, such as medical 
records or other individually identifiable health information. In 
addition, comments should not include any ``[t]rade secret or any 
commercial or financial information which is obtained from any person 
and which is privileged or confidential. . . .'' as provided in Section 
6(f) of the Federal Trade Commission Act (``FTC Act''), 15 U.S.C. 
46(f), and FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2). Comments containing 
material for which confidential treatment is requested must be filed in 
paper form, must be clearly labeled ``Confidential,'' and must comply 
with FTC Rule 4.9(c), 16 CFR 4.9(c).\1\
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    \1\ The comment must be accompanied by an explicit request for 
confidential treatment, including the factual and legal basis for 
the request, and must identify the specific portions of the comment 
to be withheld from the public record. The request will be granted 
or denied by the Commission's General Counsel, consistent with 
applicable law and the public interest. See FTC Rule 4.9(c), 16 CFR 
4.9(c).
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    Because paper mail addressed to the FTC is subject to delay due to 
heightened security screening, please consider submitting your comments 
in electronic form. Comments filed in electronic form should be 
submitted by using the following weblink: (https://secure.commentworks.com/ftc-GreenGuidesReview) (and following the 
instructions on the web-based form). To ensure that the Commission 
considers an electronic comment, you must file it on the web-based form 
at the weblink: (https://secure.commentworks.com/ftc-GreenGuidesReview). If this Notice appears at (http://www.regulations.gov/search/index.jsp), you may also file an electronic 
comment through that website. The Commission will consider all comments 
that regulations.gov forwards to it. You may also visit the FTC website 
at http://www.ftc.gov/ to read the Notice and the news release 
describing it.
    A comment filed in paper form should include the reference ``Green 
Marketing Consumer Perception Study, Project No. P954501'' reference 
both in the text and on the envelope, and 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. The FTC is requesting that any comment filed in 
paper form be sent by courier or overnight service, if possible, 
because U.S. postal mail in the Washington area and at the Commission 
is subject to delay due to heightened security precautions.
    Comments on any proposed filing, recordkeeping, or disclosure 
requirements that are subject to paperwork burden review under the 
Paperwork Reduction Act should additionally be submitted to: Office of 
Information and Regulatory Affairs, Office of Management and Budget 
(``OMB''), Attention: Desk Officer for Federal Trade Commission. 
Comments should be submitted via facsimile to (202) 395-5167 because 
U.S. postal mail at the OMB is subject to delays due to heightened 
security precautions.
    The FTC Act and other laws the Commission administers permit the 
collection of public comments to consider and use in this proceeding as 
appropriate. The Commission will consider all timely and responsive 
public comments that it receives, whether filed in paper or electronic 
form. Comments received will be available to the public on the FTC 
Website, to the extent practicable, at (http://www.ftc.gov/os/publiccomments.shtm). As a matter of discretion, the Commission makes 
every effort to remove home contact information for individuals from 
the public comments it receives before placing those comments on the 
FTC Website. More information, including routine uses permitted by the 
Privacy Act, may be found in the FTC's privacy policy, at (http://www.ftc.gov/ftc/privacy.shtm).

FOR FURTHER INFORMATION CONTACT: Laura Koss, Attorney, 202-326-2890, or 
Michael J. Davis, Attorney, 202-326-2458, Division of Enforcement, 
Bureau of Consumer Protection, Federal Trade Commission.

SUPPLEMENTARY INFORMATION: 

I. Background

    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 FTC Act, 15 U.S.C. 45.\2\ Guides are 
administrative interpretations of the law. They do not have the force 
and effect of law and are not independently enforceable. The Guides are 
the Commission's interpretation of Section 5 of the FTC Act as it 
applies to environmental marketing claims. The Commission, therefore, 
can take action under the FTC Act if a business makes environmental 
marketing claims inconsistent with the Guides. In any such enforcement 
action, the Commission must prove that the act or practice at issue is 
unfair or deceptive.
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    \2\ The Commission issued the Green Guides in 1992 (57 FR 36363) 
and subsequently revised them in 1996 (61 FR 53311) and 1998 (63 FR 
24240).
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    The Green Guides outline general principles that apply to all 
environmental marketing claims and provide guidance regarding specific 
categories of environmental claims. These categories include: general 
environmental benefit claims such as ``environmentally friendly''; 
degradable claims; compostable claims; recyclable claims; recycled 
content claims; source reduction claims; refillable claims; and ozone 
safe/ozone friendly claims. For each of these claims, the Green Guides 
explain how reasonable consumers are likely to interpret them. The 
Guides also

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describe the basic elements necessary to substantiate claims and 
present options for qualifying specific claims to avoid deception.\3\ 
The illustrative qualifications provide ``safe harbors'' for marketers 
who want certainty about how to make environmental claims, but do not 
represent the only permissible approaches to qualifying a claim.
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    \3\ The Guides do not, however, establish standards for 
environmental performance or prescribe testing protocols.
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II. Regulatory Review of the Green Guides

    The Commission reviews all of its rules and guides periodically to 
examine their efficacy, costs, and benefits, and to determine whether 
to retain, modify, or rescind them. On November 26, 2007, the FTC 
commenced its review of the Green Guides and sought public comment.\4\ 
As part of this comprehensive review, the FTC also announced a series 
of public workshops to explore emerging environmental marketing issues 
and, through subsequent notices, opened public comment periods in 
connection with each workshop.\5\ The Commission sought comment on a 
number of 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 Guides should include certain 
environmental claims--such as carbon neutrality, sustainability, and 
renewability--not currently addressed in the Guides.
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    \4\ 72 FR 66091.
    \5\ See 72 FR 66094, Carbon Offsets and Renewable Energy 
Certificates (held on January 8, 2008); 73 FR 11371, Green Packaging 
Claims (held on April 30, 2008); and 73 FR 32662, Green Building and 
Textiles (held on July 8, 2008).
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    The Commission also sought specific consumer survey evidence and 
consumer perception data addressing environmental claims. Few 
commenters submitted consumer survey evidence or consumer perception 
data. The Commission, therefore, is considering conducting its own 
study related to consumer perception of environmental marketing claims. 
This study would aid the Commission in determining what revisions, if 
any, it should make to the Guides to ensure that the Guides are 
appropriately responsive to any changes in consumer perception of 
environmental claims.

III. Paperwork Reduction Act Notice

    Under the PRA, 44 U.S.C. 3501-3521, federal agencies must obtain 
approval from OMB for each collection of information they conduct or 
sponsor. ``Collection of information'' means agency requests or 
requirements that members of the public submit reports, keep records, 
or provide information to a third party. 44 U.S.C. 3502(3); 5 CFR 
1320.3(c). As required by section 3506(c)(2) of the PRA, the FTC 
published a notice seeking public comment on the proposed collections 
of information. See 73 FR 60702 (Oct. 14, 2008). In response, the 
Commission received one comment, which was submitted by General 
Electric Company (``GE'').\6\ Section V below sets forth FTC staff's 
analysis of the GE comment.
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    \6\ General Electric Company Comment in FTC Project No. P954501 
(Dec. 15, 2008), pp. 1-4, available at (http://www.ftc.gov/os/comments/greenguidespra/00001.pdf).
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    Pursuant to the OMB regulations, 5 CFR Part 1320, that implement 
the PRA, the Commission is providing this second opportunity for public 
comment. All comments should be filed as prescribed in the ADDRESSES 
section above, and must be received on or before June 11, 2009.

IV. FTC's Proposed Study of Consumer Perception

A. Methodologies

1. Environmental Marketing Claims
    This proposed study will focus on consumer understanding of certain 
environmental marketing claims that are prevalent in today's 
marketplace. Specifically, the proposed study will examine: general 
environmental benefit claims (e.g., eco-friendly, green); sustainable; 
renewable (e.g., made with renewable energy, made with renewable 
materials); and carbon neutral and carbon offset claims. In 
recommending any changes to the Green Guides, FTC staff will consider 
the consumer research results in conjunction with the broad range of 
policy and legal issues raised by commenters and workshop participants.
    The primary focus of the proposed study is to compare participant 
responses regarding the meaning of different environmental marketing 
claims, including unqualified general environmental claims, such as 
``Green'' and ``Eco-friendly,'' and general environmental benefit 
claims combined with a specific representation--e.g., ``Green - Made 
with Renewable Materials'' (a ``qualified-general claim''). 
Specifically, using a treatment-effect methodology, the study will 
examine whether consumers viewing general environmental benefit claims 
believe that a product has specific environmental benefits, such as 
being recyclable, biodegradable, compostable, or made from recycled 
materials.
    The proposed study also will examine whether consumers viewing a 
qualified-general environmental benefit claim, such as ``Green - Made 
with Renewable Materials,'' believe that such a claim implies that the 
product provides environmental benefits beyond the specific attribute 
mentioned. Thus, for example, would consumers viewing a ``Green - Made 
with Renewable Materials'' claim for a product believe that product is 
also compostable, recyclable, or non-toxic? In addition to asking 
consumers about the unqualified and qualified general environmental 
benefit claims, the study will ask consumers how they perceive the 
specific environmental attributes that the study uses as qualifications 
(e.g., ``Made with Recycled Materials,'' ``Made with Renewable 
Materials,'' ``Made with Energy'') alone.
    The study will examine whether consumers believe that environmental 
claims suggest anything about the environmental impact of a product 
through stages of its life cycle (e.g., production, transportation, 
use, and disposal). For consumers who do think about a product's life 
cycle, the study will explore whether consumers think of more than one 
stage in the life cycle; and if they do, which specific life cycle 
stages they have in mind.
    The study will inquire about consumer interpretations of all of 
these claims in the context of multiple products to determine whether 
consumers' interpretations are affected by the product about which the 
claim is made.
    Also, the study will collect information about how consumers 
perceive claims about the purchase of renewable energy and how they 
understand claims about carbon neutrality and carbon offsets. That 
information will help the Commission determine whether additional 
guidance is needed about the use of these terms in marketing and what 
that guidance should be.
2. Study Sample
    As noted in Section IV.B below, the FTC proposes to collect 
information from up to 3,700 consumers in order to gather data on 
consumer perception of environmental marketing claims. All information 
will be collected on a voluntary basis. While having a sample that can 
be used to project to the entire U.S. adult population is not crucial 
to this study given its focus on comparing responses of participants 
who are randomly exposed to different products and claims, it will be 
useful to have as representative a sample as possible. Having 
considered the costs and

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benefits of various data collection methods, FTC staff has concluded 
that the most efficient way to collect data to meet the research 
objectives within a feasible budget is to use an Internet panel with 
nationwide coverage.
    Thus, the FTC has contracted with Harris Interactive, Inc. 
(``Harris Interactive''), a consumer research firm that has substantial 
experience assessing consumer communications via the Internet and other 
alternative protocols, to design an Internet study that, while not 
strictly representative of the nation as a whole, nonetheless reflects 
the views of a broad population. The Harris Interactive Internet panel 
consists of more than four million individuals drawn from throughout 
the country, derived from a series of convenience sampling procedures, 
rather than true probability sampling. Harris Interactive has studied 
the relationship between samples from its Internet panel and samples 
collected using more traditional probability sampling techniques, such 
as telephone surveys. Based on these studies, Harris Interactive has 
developed procedures to ensure that differences between the results of 
Harris' Internet panel studies and those based on true probability 
samples of the nation are minimized. In particular, Harris Interactive 
has used a variety of methods, including demographic weighting, 
propensity scoring, and quota sampling to obtain accurate estimates of 
national views from its Internet panel. Through study administration, 
FTC staff will work with Harris Interactive to ensure that the sample 
is as representative of the nation as possible.

B. PRA Burden Analysis

    Staff is revising certain prior assumptions,\7\ based on a more 
precise target population for completing the questionnaire and further 
consultation with Harris Interactive regarding the anticipated response 
rate. Harris Interactive anticipates that 6.3% of those invited to 
participate in the survey will respond and will fit within the desired 
distribution of demographic characteristics. Accordingly, Harris might 
contact as many as 59,000 persons to achieve the contracted aim of 
surveying 3,700 respondents.
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    \7\ See 73 FR at 60704.
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    As before,\8\ staff estimates that respondents to the Internet 
questionnaire will require, on average, approximately 25 minutes to 
complete it. Staff will pretest the questionnaire with approximately 
100 respondents to ensure that all questions are easily understood. 
Allowing for an extra three minutes for questions unique to the 
pretest, the pretest will total approximately 47 hours cumulatively 
(100 respondents x 28 minutes each).
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    \8\ See id.
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    The burden estimate now addresses both those who will complete the 
questionnaire and those who will not. Those completing it will require 
1,542 hours (3,700 persons x 25 minutes each). Those who do not 
complete the survey will spend no more than one minute; thus, 922 hours 
(59,000 total contacts - 3,700 persons completing the study) x one 
minute each). Cumulatively, then, complete and partial surveying of 
59,000 persons will total about 2,464 hours.
    Overall burden for the pretest and questionnaire would thus be 
2,511 hours. The cost per respondent should be negligible. 
Participation is voluntary and will not require start-up, capital, or 
labor expenditures by respondents.

V. Analysis of Comment Received

    As noted above, the Commission received one comment, by GE, in 
response to its notice seeking public comment on the proposed 
collections of information. See 73 FR 60702 (Oct. 14, 2008). GE's 
comment makes several suggestions about study methodology.
    In particular, GE discusses Internet-based research, noting that 
access to the study is limited to participants with access to a 
computer and that such participants tend to be persons who have self-
selected by expressing an interest in consumer research. As discussed 
above, having considered the costs and benefits of various data 
collection methods, FTC staff has concluded that the most efficient way 
to collect data to meet the research objectives within a feasible 
budget is to use Harris Interactive's existing Internet panel. Harris' 
convenience sampling procedures will obtain accurate projections of 
national sentiment based on samples drawn from its Internet panel. As 
noted above, because the primary focus of the study is to compare 
responses across treatment groups, i.e., across different environmental 
marketing claims presented to participants, rather than to project 
responses to the population as a whole, using a broad sample of 
individuals at least 18 years of age, rather than a national 
probability sample will provide useful information.
    With respect to GE's concern about identifying the ``proper 
universe of consumers,'' FTC staff has included in the questionnaire a 
brief section of questions that address participants' level of interest 
in environmental issues. For example, one question asks: ``In the past 
six months, have you chosen to purchase one product rather than another 
because the product is better for the environment?'' Through analyses 
of answers to such questions, staff can compare the study responses of 
participants who have a high degree of interest in environmental issues 
and who take these issues into account when making purchasing decisions 
with responses of participants who are not as concerned with 
environmental issues.
    GE also asserts that the FTC should ensure a ``proper sample 
size.'' The FTC staff determined the sample size of 3,700 consumers 
based on several considerations, including the funds available for the 
study, the cost of different sample size configurations, the number of 
environmental claims to be examined, and a power analysis. In this 
study, 150 participants will see each of the various environmental 
marketing claims to be compared. Staff believes that this will be 
adequate to allow comparisons across treatment cells.
    GE further recommends that the research be double-blind, so that 
``neither participants nor administrators know its purpose or who it is 
for'' and that the study employ an adequate control. To avoid biasing 
how respondents answer the questions, study participants will not be 
told that the FTC has commissioned the research in order to avoid 
biasing how respondents answer the questions. Furthermore, while 
completing the survey, participants will not have access to personnel 
at Harris Interactive who know the purpose of the study. For most 
participants, there will be no contact between the participant and any 
Harris personnel. Harris does, however, provide a telephone number or 
email for people who have technical problems while completing the 
survey. The personnel who respond to such inquiries, however, are only 
able to resolve technical problems, like an inability to connect to the 
web site. They do not know the purpose of the study and, if asked, for 
example, about the meaning of a question, are instructed to tell the 
person inquiring that he or she should answer to the best of their 
ability based on what appears on the screen. It is not necessary to 
have ``blind'' administrators. Because the proposed study is automated 
and online, participants and study administrators can have only 
technical interaction. Therefore, there is no concern that a study 
administrator might convey information about desired results to 
participants. The study employs an adequate control, testing a ``New 
and Improved'' claim that says

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nothing about environmental characteristics.
    GE asserts that the questionnaire should ask consumers about 
marketing terms in conditions that are as real-world as possible, 
suggesting that participants be shown actual advertisements and 
suggesting that the study include a control. GE also expresses concern, 
however, ``that no matter how a specific term is tested, the relevance 
of the data may be limited to the particular scenario presented.'' 
Thus, GE urges the FTC to consider how to conduct research on 
``specific terms in a manner that will both be relevant and will have 
broader applicability.''
    While the proposed study does not test actual advertisements, the 
environmental marketing claims are based upon actual claims FTC staff 
has observed in the marketplace. In addition, the study protocol tests 
each claim with three different products--kitchen flooring, a laundry 
basket, and wrapping paper. While costs prohibit conducting a study 
with more products, examining three products will provide useful 
information about the extent to which product variation affects 
participants' interpretation of the claims being studied.
    GE urges the FTC to include non-leading questions and stimuli, 
specifically recommending that the study include open-ended questions. 
FTC staff agrees with these recommendations and it has designed 
questions that are as non-suggestive and non-leading as possible. Many 
parts of the questionnaire include a combination of open- and closed-
ended questions, which ask about the same concept. Moreover, the 
questionnaire uses phrasing that minimizes the risk that participants 
will give answers that they think should be correct. For example, some 
participants will randomly be shown the claim ``Sustainable'' in 
connection with wrapping paper. The questionnaire then asks: ``Which of 
the following most accurately describes what this statement suggests or 
implies to you about any negative environmental impact that may come 
from this wrapping paper?'' (emphasis added). The response choices to 
this question then take the form: ``The statement suggests or implies 
that there is no negative environmental impact from this wrapping 
paper;'' ``The statement suggests or implies that this wrapping paper 
causes less negative environmental impact than other wrapping paper. . 
.,'' etc. The FTC staff also plans to conduct a pretest, which will 
help identify any remaining problems in this area.
    Finally, GE notes that Internet study participants may consult 
outside reference materials or other persons in responding to the 
questionnaire. While there is a possibility that participants could 
consult such sources, FTC staff believes that this not a significant 
problem. Based on its extensive Internet study experience, Harris 
Interactive assures that participants in such studies generally are 
most interested in completing the study in a relatively short period of 
time; thus, they are unlikely to choose to spend the additional time 
needed to do any such research. In addition, the questionnaire 
expressly informs each participant that the study designer is 
interested in what the individual thinks, rather than any supposedly 
``right'' answer. For example, some participants will randomly be shown 
the claim ``Eco-friendly'' in connection with kitchen flooring. The 
questionnaire then asks: ``What, if anything, does this statement 
suggest or imply to you about the kitchen flooring?'' (emphasis added). 
Moreover, the final phase of the questionnaire contains a standard 
question for all participants asking whether they consulted outside 
sources. Again, based upon its extensive experience with Internet-
protocol studies, Harris Interactive reports that participants tend to 
answer such questions honestly. Finally, Harris noted that if a 
participant consults outside sources while completing the 
questionnaire, it will take that participant longer to complete the 
study. Thus, when reviewing study results, Harris Interactive will 
examine participant response times, identifying those that are 
abnormally long, and assess whether they reflect participants' outside 
consultation.

David C. Shonka
Acting General Counsel
[FR Doc. E9-11019 Filed 5-11-09: 8:45 am]
BILLING CODE 6750-01-S