Federal Trade Commission Gives Guidance On Net Advertising

After examining existing consumer protection rules and guidelines on advertising, the Federal Trade Commission this week said advertisers must be as careful to avoid misleading consumers online as they would offline.

Since the current guidelines on “unfair or deceptive acts or practices” often use the words “written,” and “printed,” the FTC issued a paper advising how the rules should apply online.

If an advertisement needs to be accompanied by a disclosure to prevent it from being misleading, the commission staff said it should be placed on the same screen as the triggering claim, if possible. If not, advertisers should use text, visual clues or hyperlinks to point consumers to these disclosures, if necessary.

When hyperlinks are used, they should be obvious, consistent, and should lead directly to the disclosure. The working paper even said advertisers should assess the effectiveness of the hyperlink by monitoring click-through, and making changes if needed.

The bottom line is that these disclosures must be prominent and noticeable.

Some email communications got the seal of approval from the FTC, in the paper. If an e-commerce order will be late, email can be an appropriate way of communicating that to a customer, as long as the person knows to expect the communication through that medium. In addition, email is a permissible way for companies to communicate with members of a book-of-the-month club or record club, who often must decline during a certain time period if they don’t wish to receive that month’s selection.

But the working paper warned about possible violations of its regulations stemming from email marketing, saying that the same rules applying to other direct mail solicitations should apply online.

The commission published the paper after a public comment period and public workshop.

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