BBB Code of Advertising Update: Examining the Changes

As noted in our earlier post, the Better Business Bureau recently updated its Code of Advertising for the first time since 1985.  There are many changes throughout the Code, from major substantive additions to minor revisions to layout and formatting tweaks. In this post, we highlight some of the more significant changes. By far the most noticeable changes between the previous Code and the new revised version are the addition of new sections on environmental-benefit claims, negative option/continuity plans, and “Made in the USA”/“Product of Canada” claims. Each addition is consistent with corresponding US federal law (e.g., the Restore Online Shoppers Confidence Act) and/or FTC guidance (e.g., the “Green Guides” and the FTC’s Enforcement Policy on US-Origin Claims) applicable to these same topics (with the obvious exception of “Product of Canada” issues) and the substance of the new Code sections should therefore come as no great surprise to advertisers operating in those areas.

Similarly, the BBB also modified the Code’s existing section on the use of testimonials and endorsements in order to comport with the FTC’s current guides on the same, which were revised in 2009. In addition, the existing section on rebates has also been revised in the updated Code.  As revised, the Code now requires that rebate advertising “clearly and conspicuously state the before-rebate cost, as well as the amount of any rebate.  Rebate promotions must clearly and conspicuously disclose any additional terms and conditions that the consumer need to know, including the key terms of any purchase requirements, additional fees, and when consumers can expect to receive their rebate.” This, too, is a direct incorporation of existing FTC guidance (as available here under the section titled “'Free' Claims and Rebate Offers”).

Another noteworthy change is the removal of a previous requirement regarding “up-to” price savings claims.  The former Code required that claims covering a group of items state both the minimum and maximum savings available.  The revised Code eliminates this range requirement, while retaining the requirement that at least ten percent of the items covered by the claim offer the maximum advertised savings.

The Code imposes self-regulatory obligations on all entities who advertise in North America.  It is enforced at the local level by the BBB’s 112 offices throughout US and Canada and, for national advertising, by the BBB’s Advertising Self-Regulatory Council (which includes the National Advertising Division).  While the Code's new provisions in many cases reflect existing guidance from the FTC and may not themselves be a revelation to seasoned advertisers, the introduction of the revised Code does provide a good opportunity to familiarize yourself with the its requirements, both new and old.  The updated Code is available here.