Toplines From FTC’s Recyclable Claims Workshop

Authors: Sheila A. Millar and Anushka N. Rahman

On May 23, 2023, the U.S. Federal Trade Commission (FTC) held a public workshop to examine recyclable claims as part of its review of the Guides for the Use of Environmental Marketing Claims (Green Guides). The workshop was split into three panels, discussing current trends, consumer perception, and potential updates to the Commission’s current guidance on recyclable claims. 

The Green Guides are non-binding guidance from the Commission that illustrate how the FTC interprets certain general and specific environmental marketing claims under Section 5 of the FTC Act. Section 5 requires that all advertising claims, including environmental marketing claims, be truthful, non-misleading, and substantiated by appropriate evidence. It remains to be seen whether the FTC will hold additional workshops addressing other green claims.

While aluminum, paper, glass, and plastics were all discussed during the workshop, the bulk of the discussion focused on plastic waste, including technical options for recycling plastic and the role of advanced (also referred to as “chemical” or “molecular”) recycling. Despite efforts from staff to keep the workshop focused on claims and consumer perception, discussion and audience questions strayed into environmental policy territory that the FTC made clear is outside of its jurisdiction.

It is worth noting that the FTC’s enforcement of false or misleading recyclable claims has been minimal over the years; such actions have typically been addressed as part of its enforcement of other green claims. Several panelists suggested that the Commission pursue increased enforcement against false or misleading recyclable claims in lieu of moving forward with a rule. However, FTC staff focused the discussion on the following topics:

• Should the “substantial majority” basis for an unqualified recyclable claim be changed? Currently, an unqualified recyclable claim may be made for an advertised product “[w]hen recycling facilities are available to a substantial majority of consumers or communities where the item is sold,” with “substantial majority” meaning at least 60%. In recent years, several lawsuits have been filed against marketers of products with unqualified recyclable claims on the basis that those products, even if collected, are not actually recycled.[1] FTC staff members asked panelists for their views on whether or not the metrics for a recyclable claim should be changed. As with most of the issues discussed during the workshop, there was no alignment. Some panelists pointed out that there is no data to support raising or lowering the 60% threshold, while others urged the FTC to raise the threshold as high as possible. There was no consensus and no strong evidence to support a change.
• Should ability to be recycled or actual reprocessing be considered? Some panelists claimed that consumers expect that a product marketed as recyclable will actually almost always be turned into a new product, arguing that a product must actually be reprocessed for it to be marketed as “recyclable.” Other panelists countered that consumers do understand that not all waste collected for recycling is reprocessed, and it is difficult for marketers to know or even predict if a product that is collected for recycling and could be recycled will actually be reprocessed due to economic factors. One panelist provided the example of glass, which in their area is used as a cover layer for landfill and not made into new glass products, raising the question of whether this constitutes “recycling.” Furthermore, other consumer perception research indicates that consumers only believe recyclable claims to imply the capability to be recycled, not that a product will actually be reprocessed, a position that several courts have supported based on the common meaning of the term.[2] Panelists also noted that if only unqualified recyclable claims are permitted, and some level of actual reprocessing is a condition of making a claim, consumers will assume that products without the claim are not recyclable at all. Courts and agencies generally do look to the common and usual meaning of a term to reflect general interpretations, and this again is an area where it will be interesting to see how the FTC assesses the comments it receives.
• Should the Green Guides recognize advanced recycling technologies for plastics? When asked about new technologies, panelists offered diverging views on advanced recycling. Some panelists explained that this technology offers tremendous promise in recycling more plastic waste, including many types of hard-to-recycle plastics. Some panelists expressed concerns that advanced recycling allows companies to claim that turning waste into fuel or energy is “recycling”; other panelists and audience members said that is not the case, as it is well-recognized that waste to fuel or energy is not recognized as “recycling” under the existing Green Guides. Some panelists also asserted that advanced recycling is inefficient, requires mixing with virgin materials, and creates a larger environmental footprint than mechanical recycling. Of course, many materials can and are mixed with “virgin” material based on technical and economic factors, and disclosures are needed about the amount involved when that occurs. Much of the debate turned on opposition to chemicals, and some panelists noted useful consumer perception evidence supportive of advanced recycling. 
• What is the role of the resin identification code (RIC)? While the workshop was structured to examine recyclable claims generally, much of the discussion focused on the recyclability of plastics, and whether the RIC is a “recyclability” claim. Some panelists provided a historic view of the RIC, which was developed as an indicator of resin types to help recyclers sort plastics. It is not itself a per se “recyclability” claim, as recognized in the Guides. The RIC appears as a number, 1–7, indicating the resin type, within either a triangle of arrows or a solid triangle design. The RIC was never intended to serve as a communication tool for consumers, but some panelists asserted that consumers believe it is a recyclable claim. Panelists agreed that resin types 1 (polyethylene terephthalate (PET)), 2 (high-density polyethylene (HDPE)), and 5 (polypropylene (PP)) are most widely recyclable and make up the majority of packaging, while other types of plastics are not widely accepted by curbside recycling. Some panelists also asserted that consumers are confusing the RIC with the Mobius loop (a flipped chasing arrows symbol used to communicate both recyclability and recycled content). At least one panelist noted that this issue is aggravated when recycling programs encourage consumers to look for the RIC to sort their plastic. A majority of states require the use of the RIC, and it is unlikely that the FTC would revise the Guides in a way that would interfere with state law, although California law purports to restrict its use.  
• Should the FTC engage in a rulemaking to create federal requirements for recyclable claims? A common criticism of the Guides was that they are not binding, and some panelists asserted that a rule is essential to give the FTC enforcement authority. Apart from the fact that enforcement actions in this area have largely been lacking, other panelists noted that rulemakings can take years to finalize and that enforcement actions, such as issuing warning letters, should be considered first. 

It remains to be seen if information from the workshop will result in significant changes to the Green Guides or if the FTC elects to initiate a rulemaking to make the Guides binding. The FTC has looked to utilize its rulemaking authority in other areas, but green claims seem especially unsuited for generalized rules given evolving technologies and economics, as well as real questions about the scope of the FTC’s authority in the area. However, despite rather impassioned rhetoric by some panelists and audience members, available consumer perception data and the FTC’s own governing statute suggest that the FTC will not seek to categorically ban claims or technologies, or take action, such as banning use of the RIC, that would interfere with existing state law. The FTC is likely to maintain its historic technology-neutral position, closely evaluate how to substantiate recycling and recycled content claims, and consider when and how recyclable and recycled content claims should be qualified, with due regard to consumer perception evidence submitted to the docket as part of the Commission’s review of the Green Guides.

The Commission is accepting public comments on recyclable claims and other issues addressed at the workshop until June 13.

[1] See e.g., Duchimaza v. Niagara Bottling, LLC, No. 21 Civ. 6434 (PAE) (S.D.N.Y.), Swartz v. The Coca-Cola Company, No. 3:21-cv-04643 (N.D. Cal.); Haggarty v. Bluetriton Brands, No. 21-cv-13904 (N.J.), Curtis v. 7-Eleven, Inc., No. 21-cv-06079 (N.D. Ill.).

[2] Id.