Table of Contents

GUIDELINES

FOR AMS

OVERSIGHT OF

COMMODITY

RESEARCH AND

PROMOTION

PROGRAMS

January 2020

Table of Contents

I. Overview ..................................................................................................................................5

II. Budget Approval. .....................................................................................................................7

III. Donated Funds .........................................................................................................................8

IV. Contracts ..................................................................................................................................8

A. Contract Provision Requirements ......................................................................................9

B. Contract Justification........................................................................................................10

C. Contract Approval. ...........................................................................................................11

D. Contract Compliance........................................................................................................11

E. Subcontractors ..................................................................................................................11

F. Multi-Year Contracts. .......................................................................................................12

G. CEO Contracts .................................................................................................................12

H. Outside Legal Counsel Contracts .....................................................................................13

V. Finance, Compliance, and Program Accountability ..............................................................13

A. Financial Statements/Reports ...........................................................................................13

B. Refund/Reimbursement Requirements ............................................................................13

C. Activities and Expenditures .............................................................................................13

D. Annual Financial Audits ..................................................................................................14

E. Management Reviews ......................................................................................................14

F. Independent Evaluation ....................................................................................................15

G. Travel Expense Claims ....................................................................................................16

H. Credit Card Use ................................................................................................................17

VI. Refunds ..................................................................................................................................18

VII. Influencing Legislation and/or Government Policy ...............................................................19

VIII. Referendum Activities ...........................................................................................................20

IX. Policy on Review and Approval of Promotional and Educational Materials ........................21

X. Policy on Brand Names .........................................................................................................21

XI. Administration .......................................................................................................................21

A. Legal Counsel ..................................................................................................................21

B. Investment of Funds .........................................................................................................21

C. Bylaws, Policy Statements, Annual Reports, and Transparency .....................................22

D. Notice of Board Meetings ................................................................................................22

E. Board Administrative Expenses .......................................................................................22

F. Prohibited Expenditures....................................................................................................23

1. Spouse/Family Expenses ..................................................................................... 24

2. Open Bars............................................................................................................. 24

3. Influencing government policy or action ..............................................................24

4. Use of Funds for Personal Expenses .....................................................................24

5. Other Expenditures listed in this guidance document...........................................24

G. Goodwill Board Donations ..............................................................................................24

H. Compliance ......................................................................................................................25

I. Charging Research and Promotion Boards ........................................................................26

1. Direct Program Costs ........................................................................................... 26

2. Overhead .............................................................................................................. 26

3. Other Costs........................................................................................................... 26

J. Nominations for Board Membership .................................................................................27

K. Ethics ................................................................................................................................28

L. Civil Rights and Equal Opportunity .................................................................................29

M. Other Government Agencies ...........................................................................................30

N. Unemployment Practices. ................................................................................................31

O. Records Retention ............................................................................................................31

Appendix 1 – Authorizing Legislation

Appendix 2 – Statement of Principle for Research and Promotion Boards and Marketing Orders for

Information Sharing with Government Officials

Appendix 3 – Directive 2210.2 “Investment of Public Funds” (2/7/11)

Appendix 4 – Directive 420.3 “Debt Management” (5/10/04)

Appendix 5 – List of Research and Promotion Boards

Appendix 6 – Requirements for Outside Counsel Legal Services Contracts

Appendix 7 – Marketing Communication Guidelines for Program Advertising, Promotional

Material, Research, Social Media, and Other Publications

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United States Department of Agriculture

Agricultural Marketing Service

GUIDELINES FOR AMS OVERSIGHT

OF COMMODITY RESEARCH AND PROMOTION PROGRAMS

I. Overview

Congress delegated to the Department of Agriculture (USDA) the responsibility for

implementation and oversight of commodity promotion, research, and consumer

information programs established under freestanding legislation, commonly known as

“checkoff” programs. In 1996, the Commodity Promotion, Research, and Information

Act, commonly known as the “Generic Act” was enacted to allow commodity groups to

create programs for their commodities under a generic statute. Prior to the Generic Act,

many of today’s programs overseen by USDA’s Agricultural Marketing Service (AMS)

were established under commodity specific legislation (see Appendix 1). The Secretary

has delegated all functions to AMS for these programs except those delegated to USDA’s

Foreign Agricultural Service (FAS), which has been given the authority to oversee

international marketing activities (Federal Register Vol. 62 No. 144).

The funding for such programs is industry specific, usually through deductions from sales

by producers, marketers, and/or importers, and the programs are directed by industry

boards. However, the Federal legislation which provides the authority for the collection

and expenditure of funds also mandates for all of the programs that the Secretary of

Agriculture appoint the board members and approve the boards’ budgets, plans, projects,

and contracts. USDA is committed to oversight of research and promotion (R&P) boards

in ways that allow them to grow and adapt to a fast-changing marketplace, including

leadership to serve on the boards that reflects a diversity of perspectives and opinions.

The boards’ staff and appointed membership determine the direction of and carry out board

programs and manage the boards. Every R&P program has a mission to maintain and

expand the markets for its commodity. The boards are composed primarily of those in the

marketing chain who pay assessments and as board members they decide how board funds

are spent. Because these R&P programs use assessment money to carry out their functions,

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transparency and oversight of these funds is critical. AMS’ role is one of oversight – to

ensure compliance with all applicable legislation, regulations, and policies.

State and regional promotion programs that have been authorized by Federal or State laws

fall under those jurisdictions and as such those laws are controlling for those

programs. Many of the State programs fall under the oversight of State Departments of

Agriculture, Consumer Affairs, or other state agencies, which apply State guidance.

If the Federal legislation or regulations specifically require AMS oversight of State and

local programs, portions of the Guidelines for AMS Oversight of Commodity Research and

Promotion Programs (Guidelines) may apply. If not directed by statute or regulation, the

Guidelines do not apply as a whole to State, regional, or local programs. Some State,

regional, and local programs receive and expend funds from the national checkoff program.

Though AMS does not have direct oversight of these State and local programs, AMS has an

obligation to ensure that national checkoff funds are expended appropriately in accordance

with the Federal legislation, regulations, and any applicable policies. State, regional, and

local programs cannot use national checkoff funds to carry out an activity unless authorized

by the national program.

These Guidelines are not meant to cover all aspects of AMS’ day-to-day responsibilities in

interacting with and supporting activities of the R&P boards. They are designed to

facilitate the application of legislative and regulatory provisions of the acts and orders to

promote consistency in AMS’ oversight of all commodity promotion and research

programs.

References to boards in this document also can mean board staff unless otherwise specified.

The Guidelines provide information on AMS’ expectations for how boards will operate and

for how AMS will approach oversight of the programs. These Guidelines shall be reviewed

and amended as necessary. However, in all cases, provisions in the authorizing legislation

and order for all programs provide the legal framework for all board actions and will take

precedence over the Guidelines in establishing parameters for board activities.

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II. Budget Approval

A. USDA will review and approve all budgets. When submitting budgets to AMS for

approval, boards must include detailed information regarding administrative expenses

and other costs. Budget submissions must include, at a minimum, all of the following

components:

1. A statement of objectives and strategy in each major program area (research,

advertising, etc.), including reasons for significant changes from the preceding

budget period.

2. A summary of anticipated revenue (assessments, interest, donations, etc.) and

anticipated refunds, where applicable, with comparative data for at least the

preceding year.

3. A summary of proposed expenditures by major program areas with comparative

data for at least the preceding year. (Unless it is the initial year of the program.)

4. Staff and administrative expense breakdown, with comparative data for at least

the preceding year. Boards must submit CEO and/or Executive Director salaries

and compensation and for other staff as requested by AMS. This information

may be supplied in a document separate from the budget.

5. Other legislative requirements as applicable to the budget process.

B. AMS will review budgets for compliance with legislative, regulatory, and policy

requirements. Boards must receive AMS’ approval of budgets prior to obligating any

funds. AMS also will review and approve amendments or additions to approved budgets,

including shifting of program funds from one major area to another. The respective

program Deputy Administrator will approve initial budgets. The respective program

Deputy Administrator will also approve amendments if the changes are 30 percent or more

of the total budget. Otherwise, the Deputy Administrator’s designee will approve the

amendments.

C. Boards shall review and approve budgets and any subsequent amendments prior to

submission to AMS.

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D. Boards must post on their websites and make available to the public annual budget

summaries by major category.

III. Donated Funds

The legislation governing the boards ranges from total prohibition to a specific

authorization to accept certain donations. In cases where donations are not prohibited,

AMS will allow boards to accept donated funds.

Donated funds must be clearly listed in the budget and incorporated into the budget process

to be used for activities permitted under the authorizing legislation, and AMS will review

and approve these budgets, including budget amendments, before funds are expended.

Donated funds are subject to inclusion in AMS management reviews.

Donated funds must be free from any encumbrances by the donor and the board shall retain

complete control of their use. Boards may receive funds from outside sources such as

Federal or State grants, with AMS approval, for specific authorized projects. Boards must

not accept contributions which create a conflict of interest or a situation which could

reasonably be perceived by a third party as a conflict of interest.

Donations made by the boards are discussed in Section XI.G.

IV. Contracts

AMS recognizes that boards may enter into a variety of contracts, including for projects,

consultation, services, and administration, and that boards select contractors based on a

variety of factors and criteria including but not limited to cost, skills, timeliness, and

experience. The funds and other funding sources must be included in the budget to carry

out the obligations of the contracts. The provisions of all contracts must be compliant with

the board’s Act, Order, and USDA policies and guidance.

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Contracting Procedures. Each board shall establish written contracting procedures and

submit them to AMS for review and approval by the respective program Deputy

Administrator. Each board has broad discretion on contracting procedures provided they

meet the fiduciary responsibilities of the board and avoid any conflict of interest or a

situation that could reasonably be perceived by a third party as a conflict of interest.

A. Contract Provision Requirements: Board contracts shall include the following:

1. Provision that the board, as well as the Secretary of Agriculture, may terminate

the contract and be relieved of payment. Contract language should indicate

boards will pay for all work performed under contract until date of termination.

2. Provisions that formally notify potential contractors that any work they

undertake prior to contract approval by AMS is at their own risk and boards are

not financially liable if the contract is not approved.

3. Provisions stating funds paid to the contractor may not be used for the purpose

of influencing legislative or governmental policy or action.

4. Provisions requiring the contractor to (a) keep accurate records, books, and

documents involving transactions relating to the contract; (b) retain the records,

books, and documents for 3 years; and (c) that the records, books, and

documents may be subject to inspection and audit by a representative of USDA

and the board.

5. The EEO policy statement:

Contractor [insert entity] agrees that, during the performance of this Agreement,

[insert entity] will not discriminate against any employee or applicant for

employment because of race, color, national origin, religion, sex, age, disability,

protected genetic information, or reprisal. [Insert entity] further agrees that

[insert entity] will fully comply with any and all applicable Federal, State and

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local equal employment opportunity statues, ordinances and regulations,

including, but not limited to, Title VII of the Civil Rights Act of 1964, the

Americans with Disabilities Act of 1990, the Age Discrimination in

Employment Act of 1967, Genetic Information Act of 2008, and the Equal Pay

Act of 1963. Nothing in this section shall require [insert entity] to comply with

or become liable under any law, ordinances, regulation or rule that does not

otherwise apply to the [insert entity].

Contracts must not include:

1. Indemnification provisions, unless it is clear that the indemnification will in no way

obligate the U.S. government to pay on a potential claim. Any indemnification

clause must include language to the following effect:

The board and [contracting party] agree that no funds appropriated by the United

States Government shall be used, made available, or sought by any party to pay any

indemnification obligation or to meet any deficiency arising under or relating to this

agreement.

2. Liquidated Damages

B. Contract Justification. Boards shall develop and maintain documentation in their files

evidencing why a contract was awarded to a particular contractor, including justification

when the lowest bid is not awarded or if the contract was awarded on a non-competitive

basis. Documentation may be a short statement or checklist, as noted below, or other

agreed upon notation: At a minimum, documentation must include:

• Contract was competitively bid: Yes___ No ____

• Reason for selecting contractor, if contract was not competitively bid or

lowest bidder was not awarded contract (select all that apply):

Contractor has unique knowledge of activities

Unique contractor for specific purpose (i.e. science, researcher)

Project spokesperson

Partnership or sponsorship agreement

Other (please describe)

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C. Contract Approval. AMS will approve contracts for the development and carrying out of

programs and projects, such as research, development, advertising, promotion, or

education, as well as contracts for administration, services, outside legal counsel,

accountants, auditors, legal assistance, and consultants. The contracts will be reviewed for

conformance with provisions required by AMS including language regarding the

prohibition on lobbying. Contracts must be approved by AMS before funds are expended.

AMS will not require boards to submit for approval pure service contracts, such as those for

janitorial services, copier repairs, hotel arrangements, maintenance, and subscription

services, such as software, LexisNexis, etc. However, AMS reserves the right to review

service contracts at any time. The use and amounts of contract thresholds are at the

discretion of each Program area.

D. Contract Compliance. Following AMS approval, boards shall monitor all contracts to

ensure that all contractors (and subcontractors, if applicable) are in compliance with the

terms of the contract. Boards shall maintain documentation evidencing the monitoring of

such contracts.

E. Subcontractors. Subject to the board’s approval, the contractor may subcontract specific

tasks to outside parties. Should the contractor elect to subcontract specific tasks,

subcontractors will be subject to the same contractual terms as its contract agency in regard

to:

1. Reporting and Record Keeping

2. Travel Expenses

3. Title of Property

4. Confidential Information

5. Influencing Legislation and/or Influencing Governmental Policy or Action

6. Federal Civil Rights policies.

The primary contractor agency who has a direct contract with the board will be fully

responsible for the quality of all work products, including any approvals from AMS. Any

such authorization in the contract must state that entering into a subcontract does not relieve

the contractor of primary responsibility to carry out the terms and conditions of the

underlying contract in accordance with the Act, Order, Regulations, and USDA policies,

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including these Guidelines. AMS will review a sample of subcontractor contracts during

management reviews.

F. Multi-Year Contracts. With AMS approval, boards may enter into multi-year contracts

provided the years are severable and either, all funding is approved during the initial budget

year, or performance under the contract during the second and subsequent years of the

contract is contingent upon the availability of funds and approval by the board. Contracts

must include clear language that the Secretary of Agriculture and the board may terminate

the contract without incurring the full contract cost. Boards must annually provide a list of

all active multi-year contracts with current year funding requirements for AMS review.

Leases are exempt from these requirements.

G. CEO Contracts. When the board enters into a contract or agreement for employment,

including at-will employment, for the Chief Executive Officer (Executive Director,

President, or such other title as prescribed by the board), the board must notify AMS and

provide the following information in writing:

• Term of employment;

• Employment status (e.g. at-will, agreement with automatic renewal/Evergreen

clause, etc.);

• Termination clause (if any);

• When the agreement and terms were approved by the Executive Committee or the

board;

• Compensation (including Base Compensation, Bonuses & Incentives, Other

Compensation, Deferred Compensation, Tax Free Benefits, etc.); and

• All provisions of the Act, Order, guidelines, and other applicable regulations are

adhered to in the contract

CEO contracts are subject to review by AMS during management reviews or as deemed

necessary.

H. Outside Legal Counsel. Boards may enter into contracts with outside legal counsel for

specific legal issues and timeframes. AMS and OGC must review and approve outside

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legal counsel contracts. See Appendix 6 for Requirements for Outside Counsel Legal

Services Contracts.

V. Finance, Compliance, and Program Accountability

A. Financial Statements/Reports. Boards shall submit to AMS for review financial

statements or reports for each accounting period (monthly or quarterly) for proper

accountability of funds collected and expended. The financial statements will consist of (1)

a financial position (balance sheet), and (2) a statement of activities (i.e., assessment

revenues and expenditures; budget and actual) including a comparison of actual results to

budget, and (3) the overall change in net assets for the reporting period, including

unexpended budget for all budget line items and operational budget expenses. For

example, a budget vs. expenditures, vs. unexpended balance.

B. Refund/Reimbursement Requirements. Where refunds/reimbursements are applicable,

the financial statement shall include, for the accounting period, a collection and

refund/reimbursement report showing (1) year-to-date collection of assessments, number of

requests for refunds/reimbursements, and total assessments refunded/reimbursed, and (2)

comparative data for the preceding year, if applicable.

Refunds are also discussed in Section VI.

C. Activities and Expenditures. AMS shall review and approve program activities and

expenditures for compliance with applicable legislation, regulations, and policies.

Boards, contractors, and subcontractors are accountable for how board funds are spent.

When projects are contracted, boards must be aware of how the funds are to be used.

Boards must expend all funds – whether the funds are from assessments or from an outside

source (e.g., donations/contributions) – in accordance with the act, order, regulations, and

AMS policy. Unless otherwise directed by authorizing legislation, boards may not conduct

projects with non-assessment funds that could not be conducted with assessment funds. For

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example, boards may not conduct activities to influence government policy or action, even

if the activities are paid for with non-assessment funds.

D. Annual Financial Audits. Boards shall have independent audits performed annually in

accordance with Generally Accepted Government Auditing Standards (GAGAS). AMS

staff will review and approve the board’s letter of engagement with the auditor, participate

in any entrance and exit conferences, and participate in the resolution of findings. AMS

participation may be via conference call. AMS shall review these annual audits to

determine if the auditor identified any misuse of board funds and if the audit adequately

addressed whether (1) funds were discovered to be used for influencing government policy

or action, (2) the board adhered to the AMS investment policy (Appendix 3), (3) internal

controls over funds met auditing standards, (4) funds were used only for projects and other

expenses authorized in a budget approved by USDA, and (5) funds were used in

accordance with the Guidelines. It is acceptable for the firm, based on the results of

fieldwork performed, to give a negative assurance (i.e. no audit opinion is rendered,

nothing came to the attention of the auditors, etc.) on such matters.

The auditors or their designees will present the audit report to an established committee

and/or the full board, for review and approval. The board will then submit a final audit

report to AMS for review and approval. Once approved by AMS, the board will post the

report on their website.

E. Management Reviews. AMS shall conduct a management review of each R&P board at

least once every 3 years to provide assurance the board’s controls (programmatic, financial,

and compliance) are designed effectively and function as intended to prevent the misuse of

funds. Management reviews will be conducted in accordance with these and other

applicable guidelines such as the Government Accountability Office guidance and

standards for internal control, to ensure boards follow policies and maintain adequate

records.

AMS will: 1) give reasonable notice and clear instructions with board staff as to what is

expected and items that need to be supplied and reviewed; 2) coordinate with the board for

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scheduling management reviews; 3) conduct an entrance interview to discuss the

management review plan and an exit interview to review findings; 4) provide a written draft

of its report to board staff and provide one opportunity for review and comment; and 5)

provide a written report to the board CEO and Chairperson. The report will ask for a

written response from the board. AMS will establish a deadline for the board’s response to

the findings and will ensure the board takes any corrective actions.

Management reviews will cover, at a minimum, the following areas:

• Disbursements/Accounts Payable

• Expense Reports – Board Members

• Expense Reports – Board Employees

• Credit Card Statement Activity

• Assessments/Accounts Receivable

• Investments

• Bank Reconciliations

• Petty Cash Reconciliation

• Insurance and Fidelity Coverage

• Backup and Storage of Accounting Records

• Contract and Subcontract Compliance

• Promotional Materials

• Compliance with Guidelines

F. Independent Evaluation. AMS will ensure boards conduct an independent evaluation of

the effectiveness of their promotion programs every 5 years, unless otherwise required by

authorizing legislation. AMS must review and approve the contract/project for the

independent evaluation prior to the implementation of the review. The independent

evaluation must contain the following sections:

• Introduction/Background

• Objective/Scope

• Data Limitations Addressed

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• Credible Methodology (Assesses the returns/benefits on promotion or other

authorized activity; data driven analysis; data trends; captures structural changes

where appropriate; and appropriate data sources)

• Results

• Conclusion

• Non-technical presentation

• Adequate documentation

AMS will review and approve the independent evaluation report prior to its release. Once

approved, the board will make the report available to assessment payers, the public, and

will post the report on the board’s website.

G. Travel Expense Claims. Boards shall establish travel policies and procedures, approved

by AMS, including the individual(s) designated to approve travel. Policies and procedures

shall address and incorporate all of the following:

1. A process for travel pre-approval where all travel is approved by a

supervisor or the board’s designee. Travel may be pre-approved via e-mail.

In the case of board meetings, an invitation to board members will suffice.

2. Travel rules, which shall include type of carrier (POV, rental, rail, air, etc.)

and rates (non-refundable, economy, business, first-class).

3. A standard expense claim, electronic or paper, for any reimbursement from

assessment funds must include claimant’s name, travel dates and times

(departure and return), and other applicable identifying information. The

claim shall provide clear descriptions of the destination and purpose of the

travel.

4. If the claimant is an employee of the board, the claim shall be approved by

the supervisor or the board’s designee.

5. If the claimant is a board member, the claim must be approved by the

Treasurer, board Chairperson, or someone designated by the Chairperson.

6. If the claimant is a board officer, the claim must be reviewed and approved

by the Chairperson of the board or the board’s designee.

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7. If the claimant is the board Chairperson, the claim must be reviewed and

approved by the Treasurer or the board’s designee (CEO, CFO or Executive

Director).

8. For all modes of travel, coach fare shall be used unless the board approves

otherwise. When the ticket is purchased by cash or personal credit card, the

original itinerary issued by the airline, travel agent or website shall be

attached to the expense claim.

9. Lodging expenses shall be reasonable and should be at rates comparable to a

standard, single-occupancy room at a national business-class hotel chain

unless justified by the board. Reimbursement for the cost of hotel

accommodations shall be supported by an original receipt issued by the hotel

which will contain the occupant’s name, date the receipt is issued, the arrival

and departure dates, and the rate per day.

10. Receipts for travel-related expenses must be submitted for

reimbursement. It is preferable for travelers to submit original receipts.

Original receipts are receipts for cash expenses or hard-copy printouts from

electronic sources, such as for airfare or lodging, or electronic records of

such receipts. If originals are not submitted, the traveler may submit legible

and clear receipts electronically (PDF or other image file). Boards must

keep receipts, in a format determined by the board, whether original, hard

copies, or electronic, for at least 3 years for audit or inspection. Boards may

designate a reasonable threshold below which receipts are not required.

11. Boards may establish a means of submitting expense reports electronically.

Any such electronic expense reporting system must be reviewed by AMS to

ensure the system satisfies the requirements of this section.

H. Credit Card Use. Boards will develop a written policy statement regarding corporate

credit card use. This policy statement will be reviewed and approved by AMS. The board’s

credit card policy shall include the following:

1. Board staff must reimburse personal expenses within 30 days of receiving a

bill for such expenses from either the board or the corporate credit card

company.

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2. The board's name must be printed on the card.

3. Dollar limitations or credit limit must be set unless an exception is approved

by the board and documented.

4. Define permissible purchases (e.g., gas, supplies, travel).

5. A control sheet must be maintained listing, for each card, its type (e.g., Visa,

MasterCard, or American Express), the sponsoring bank or company, card

number, limitation, and the dates of issuance and return.

6. A single staff member shall be designated to safeguard and distribute the

cards and keep the control sheet current.

7. The control sheet should be reviewed annually by the designated board staff.

8. Specific persons and staff positions eligible to use cards must be identified

based on the appropriate need of the organization.

9. An individual expenditure report shall be completed to justify the

appropriate use with original receipts attached to the report.

10. Credit card expenditures shall be reviewed each month by a supervisor or

the board’s designee.

11. The board will develop, and approve, a policy to address use of board issued

credit card award points earned during the conduct of board business.

VI. Refunds (where applicable)

In the event refunds are necessary due to a referendum, AMS will develop a procedure and

ensure that the board follows it. In addition to the refund requirements in the enabling

legislation, it is AMS policy that:

• Boards will disseminate procedures approved by AMS for requesting refunds.

• No pressure of any kind to discourage refunds is brought by boards or staff against

those seeking refunds.

• Names of individuals obtaining refunds must be kept confidential and made available

only to appropriate staff personnel.

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• Refund information released will be limited to the dollar amount and number of

refunders by State, region, or nationwide and presented in a manner that protects the

identity of individual persons or firms.

Refund reporting is discussed in Section V.B.

VII. Influencing Legislation and/or Government Policy

Whether by statute or AMS policy, boards are not able to use assessment funds to influence

legislation or government policy. In the process of monitoring board activities, it is

important for AMS to be aware of any actions which may conflict with prohibitions on

influencing legislative and/or government policy. This prohibition on the use of checkoff

funds applies equally to any trade/producer organizations funded wholly or in part by a

particular board or contractor to the boards. However, this does not affect a trade/producer

organization’s ability to lobby with non-checkoff funds. Likewise, there are no restrictions

on individual board members, except when acting in an official capacity for the board. The

following definitions serve as a guide for commodity programs (see also Appendix 2).

A. “Influencing of legislation” is defined as:

1. Any attempt to affect the opinions of the general public or any segment

thereof concerning current or proposed legislation; or

2. Any attempt to influence legislation through communication with any

member or employee of a legislative body or with any government officials

who may participate in the formulation of legislation. ‘Government

officials’ refers to federal employees outside of USDA, foreign, and State

governments/officials, legislators, and legislative staffs.

B. “Influencing of governmental policy or action” is defined as any action the principal

purpose of which is to bring about a change in existing policy or regulation or affect the

outcome of proposed policy or regulation, except those actions which are specifically

provided for in the act, order and/or rules and regulations.

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D. It has been longstanding AMS policy to allow boards to share factual information with

government officials under certain conditions:

a. Prior approval is obtained from AMS for the information to be provided to ensure

that it does not influence legislation or government policy; previously approved

materials do not require re-approval.

b. For recurring or standalone educational sessions with government officials, meeting

arrangements should be reviewed in advance with AMS. In exceptional cases,

AMS may also consider factors such as location and timing of the meeting as part of

the review process.

c. A disclaimer is provided during discussions or on materials that outlines what

boards can and cannot do. For example, “Information is provided for educational

purposes and is not intended to influence legislation or government policy.”

d. Boards are not expected to request advance approval when responding to a direct

and immediate request (e.g. phone call, email) for information but should remind

the inquirer of their role. For example, if a board receives a phone call from a State

Congressman’s office asking for information about a particular research program

funded by the board, the board should provide the information directly with

appropriate disclaimers.

This guidance is intended to cover the majority of routine, ongoing interactions between

boards and government officials. For more significant and infrequent events – such as

showcases with multiple boards – consideration will be elevated to AMS’ Research and

Promotion Functional Committee and the Administrator’s office.

VIII. Referendum Activities

Boards and board members, when they are acting in their official capacities, are prohibited

from attempting to influence the result of a referendum, and no board funds may be

expended for that purpose. Boards and board members may only publicize referenda and

the votable issues, explain their programs, and provide information about the voting

process.

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Once a referendum is announced, AMS will review and approve all board communications

to industry before they are distributed to ensure their appropriateness.

IX. Policy on Review and Approval of Promotional and Educational Materials

AMS will review all promotional and educational materials (marketing communications) of

boards, approving those in compliance with the Marketing Communication Guidelines for

Program Advertising, Promotional Material, Research, Social Media, and Other

Publications (Marketing Communication Guidelines), and applicable legislative authority.

For additional information on marketing communication guidance, refer to the Marketing

Communication Guidelines found as an appendix in these Guidelines (Appendix 7). No

marketing communications should/can be released prior to AMS approval.

X. Policy on Brand Names

Concerning the boards’ funding of promotion or advertising involving brand name or trade

name products, AMS first requires that boards operate within their legal framework. The

various legislation governing the boards provides different thresholds of acceptable brand-

name advertising.

XI. Administration

A. Legal Counsel. USDA’s Office of the General Counsel (OGC) acts as legal counsel to the

boards.

B. Investment of Funds. AMS requires boards to follow the AMS investment policy

(Appendix 3) to ensure proper investment of board funds. AMS will review the investment

statement for each accounting period (monthly or quarterly) to verify that board funds were

invested in accordance with this policy.

C. Bylaws, Policy Statements, Annual Reports, and Transparency. Boards are required to

establish bylaws and policy statements that AMS will review and approve. The respective

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program Deputy Administrator or designee will grant approval. In order to be transparent

and recognizing the importance of all stakeholders being able to access regular, reliable,

and comparable information, board bylaws, annual budget summaries by major category;

annual reports containing detailed information on board activities, projects, and

administrative expenses; the board’s annual Certified Public Accountant audit report; and

independent economic evaluations will be posted on the board’s website.

D. Notice of Board Meetings. Boards must provide advance notification to their AMS

Program area of all board meetings, including but not limited to meetings of the full board,

executive committee, subcommittees, advisory committee, standing committees, ad hoc

committees, task forces, and any other meetings as requested by AMS. The term

“meetings” includes but is not limited to on-site meetings, conferences, conference calls,

and webinars. AMS will attend board meetings and participate in conference calls,

webinars, committee meetings, and any other meetings involving the boards when deemed

necessary by AMS. Meetings with other Government agencies are addressed in Section

XI.M.

E. Board Administrative Expenses.

1. Recognizing inherent differences in implementing laws or regulations, scope, and

funding among commodity promotion and research programs, AMS expects each

board and State association or other organization authorized by law to receive

assessment funding, to establish and maintain the minimum level of annual

administrative expenses necessary to efficiently and effectively carry out the programs

mandated by law. Each board shall include its annual administrative expenses as a

separate item in its annual report. Each State association or other organization may be

required to report its annual administrative expenses in a similar manner.

2. The Secretary’s costs for oversight of the research and promotion boards and OGC

fees will not be considered an administrative expense of the boards as these charges

are outside commodity boards’ control and management.

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3. AMS does not specify which expenses the boards must include under administration,

and certain costs may be billed back as program costs as deemed appropriate by AMS.

Board members should be knowledgeable of how the board calculates administrative

costs and whether and how they are charged to programs. As a general rule, the items

on the following list may be included in boards’ administrative expenses:

staff salaries and benefits

telephone expenses

bonuses

database management

staff travel

audit fees

board member travel

insurance and bonds

meeting expenses

bank fees

equipment purchases and rentals

legal fees (excluding OGC user fees)

equipment repair and maintenance

postage and shipping

furniture purchases and rentals

consultants on administrative matters

depreciation

memberships and subscriptions

general supplies

licenses

paper

taxes

printing

some Internet-related costs

office rent and utilities

compliance activities

automobiles

4. Administrative caps. Boards whose authorizing legislation establishes administrative

caps may not conceal administration expenses in other budgets, though some costs

may be considered program costs as appropriate. Questions as to whether an expense

is administrative or program should be directed to AMS.

F. Prohibited Expenditures.

Boards may not spend assessment funds for:

1. Spouse/Family Expenses. Board members and alternates are not allowed a fee

or compensation for board services or expenses for spouses or other family

members. An exception to this is spousal participation at buffet style dinners

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during board meetings. Board staff and contractors are prohibited from

claiming any expenses for spouses or other family members.

2. Open Bars. Boards are prohibited from using assessment funds for open bars.

3. Influencing government policy or action, as defined in Section VII.

4. Use of funds for personal expenses.

5. Other prohibited expenditures listed in this guidance document.

G. Goodwill Board Donations. Boards will develop a written policy statement regarding

goodwill donations utilizing funds derived from assessments. This policy statement

will be reviewed and approved by AMS.

1. Boards are prohibited from making financial and gift contributions to any

organization, even in honor or memory of an individual.

2. Boards may make donations of commodity, product, or funds (e.g., to food banks or

disaster relief efforts) provided the donation is tied to a public relations or

promotional effort promoting the commodity and/or the image of the industry.

3. Boards may establish policies to expend funds:

a. Up to $200 per board member per event, for cards, flowers, plants or

similar tokens for special events or occasions (e.g. birth/adoption of a

child, death of a family member, celebration of marriage, etc.);

b. Up to $300 per board member or officer per term to recognize the board

member’s service;

c. Up to $200 per board employee per event, as part of regular personnel

practices, to include flowers, plants or similar tokens for special events or

occasions (e.g. birth/adoption of a child, death of a family member,

celebration of marriage, etc.); and

d. Up to $200 per board contractor per event, as part of regular business

practices, to include flowers, plants or similar tokens for special events or

occasions (e.g. birth/adoption of a child, death of a family member,

celebration of marriage, etc.).

Page 25

4. AMS will allow boards to provide monetary gifts, gifts that function as money, or

other gifts as part of a research or promotion project (e.g., financial restitution to

subjects of a research study, gift cards to survey participants) because such

restitution is common practice and doing so benefits the board’s collection of

information or extends the reach of a promotion.

5. Nothing in this section prohibits boards from providing funds to an organization if

the funds are for a direct allowable expense. As an example, a board may not make

a contribution to the American Heart Association in memory of an individual, but

the board may provide funds to the American Heart Association as part of the board

promotion to cover exhibiting or symposium costs.

6. This section does not prohibit boards from paying membership or sponsorship fees

to industry associations or other groups, but the association or group must certify

that those funds were not used for the purpose of influencing government policy or

action (e.g., in an agreement, letter, or other documentation).

H. Compliance. Boards are responsible for promptly identifying delinquencies in

assessments. Each board shall develop written compliance procedures, reviewed and

approved by AMS, that include a timetable for the referral of compliance cases to AMS for

appropriate action. The board will make every attempt possible to bring delinquencies into

compliance before referring a case to AMS. Boards will notify AMS of any delinquency

after all efforts have been exhausted by the national board, and where applicable, State

program. Before submission to AMS, boards will conduct or coordinate an audit or

accounting of the alleged delinquent party. Upon receipt of compliance cases (including

audit results), AMS will review the case and may:

• Contact the delinquent party either by telephone, letter with delivery confirmation

(e.g., FedEx or certified mail), or other means;

• Refer violations to OGC for action; or

• Other actions as appropriate

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1. Bankruptcy of an assessment payer: If the board receives a notice of a debtor

(company not paying assessments) filing for bankruptcy protection, the board should

forward the notice and any correspondence as soon as possible to AMS.

2. Uncollectible Debt: Only USDA can forgive assessment debt, including late fees

and interest. Therefore, any uncollected debt that the boards wish to write off their

books needs to be sent to AMS for appropriate action. AMS Programs shall be

guided by authorities outlined in Appendix 4 for writing off uncollectible

assessments and late fees.

I. Charging Research and Promotion Boards. R&P authorizing legislation requires boards

to reimburse AMS for its costs in overseeing their programs. It is AMS policy that all R&P

programs be charged in a fair and equitable manner and that all costs be covered. In this

regard, the following costs will be billed to boards:

1. Direct Program Costs. These costs include salaries and benefits of employees

directly involved in the daily workload associated with research and promotion

boards. Other costs include travel to board meetings, rent, as applicable, for office

space for employees directly working on the research and promotion programs,

printing, supplies, equipment, and other reasonable costs needed to complete the

work involved in overseeing the programs. All direct program costs should be

charged to the appropriate research and promotion programs.

2. Overhead. As with all AMS programs, a percentage of the direct program costs

are charged as overhead to cover other AMS and USDA expenses associated with

these programs, and AMS must bill these expenses back to the boards.

3. Other Costs. The costs billed to AMS by USDA offices for authorized services

provided in the support of the various boards will be charged back to the boards.

These include all billed costs to AMS by other USDA agencies and outside

government agencies. Also, costs billed to AMS by States for actual unemployment

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claims paid to former board employees will be charged back to the boards when the

bills are received by AMS.

J. Nominations for Board Membership. USDA sees the pursuit of diversity in board

membership as an opportunity for embracing new ideas and growth that will enable boards

to better serve their respective industries. Central to this effort is the goal of growing new

leadership to serve on the boards that reflects a diversity of perspectives and opinions. The

industry population that pays the marketing and promotion assessment is diverse, and the

boards should reflect that diversity in the size of operations, experience of members,

methods of production and distribution, marketing strategies, and other distinguishing

factors that will bring different perspectives and ideas to the table.

AMS policy is that the diversity on the boards should reflect the diversity of their

industries. Therefore, when making recommendations for appointments, the industry must

take into account the diversity of the population served and the knowledge, skills, and

abilities of the members to serve a diverse population.

To ensure the best and most diverse representation possible, boards and applicable

nominating organizations should conduct extensive outreach for qualified candidates and

provide at least two nominees for each vacant position, unless otherwise stated in their

legislation or regulations, within the nomination timeframe provided by USDA. If two

nominees are not submitted, there may be a delay forwarding the nominees to the Secretary

until two names are received.

AMS requires boards to develop diversity plans, approved by AMS, that outline concrete

action plans to identify and encourage nomination of a diverse slate of candidates based on

the criteria described above. Boards may engage other USDA agencies (FSA, etc.),

universities, industry groups, and others to encourage participation. The nomination

process should demonstrate outreach to multiple groups.

The nomination package will be submitted to the Office of the Secretary through the

Administrator of AMS, in accordance with established timeframes and procedures.

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K. Ethics. Service on and the operation of the Federal boards is a public trust, requiring

members and employees to place the appropriate legislative authority and ethical principles

above private gain. Each board will develop a Code of Ethics and distribute it annually to

board members and staff. Each board, with the assistance of AMS, will also develop

Disclosure Statements and Conflict of Interest Statements that will be signed and submitted

by each board employee annually and by each board member prior to appointment to the

board and annually thereafter.

Boards may add additional prohibitions to the Code of Ethics as needed; however,

prohibitions cannot violate a member’s personal rights. If a board believes a board member

or staff employee has violated the Code of Ethics, the board should inform AMS of the

allegation and provide any supporting documentation. The Code of Ethics shall include

prohibitions on the following:

1. Using board time, facilities, equipment, or supplies for private purposes.

2. Using confidential information acquired by virtue of board activities.

3. Receiving or accepting money or any other consideration from anyone or any

organization other than the board—not including salary derived from one’s primary

employment—for the performance of duties as a board member, unless approved by

AMS.

4. Receiving or accepting anything of value from anyone who is doing or seeking to

do business with the board under circumstances from which it reasonably could be

inferred that the item was intended to influence the officer in an official action as an

officer of the government.

5. Making unauthorized commitments or promises of any kind purporting to bind the

board or committee.

6. Giving preferential treatment to any private organization or individual.

7. Engaging in outside employment or activities, including seeking or negotiating for

employment, that conflict with board duties and responsibilities. For staff, no such

conflicting outside employment or activities are permitted; for board members, such

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employment or activities may be permitted provided board members recuse

themselves from any conflicting board duties and responsibilities, including votes.

Reporting of Alleged Violations:

If the board receives or obtains information regarding an alleged violation of any

statute that USDA administers, USDA regulations, or any Federal or state criminal

law involving the board or its employees while on duty, while on the board’s

premises, or using or accessing board property, or the use of checkoff assessments,

the board must report the information or allegation to AMS as soon as possible but

no later than five business days after receiving or obtaining the information or

allegation.

Boards are responsible for taking action to remedy any fraud or misuse of funds.

Such action should be immediately reported to AMS. All subsequent actions should

be approved by AMS. Board members and employees must report any inappropriate

or misuse of funds to the board’s AMS Division Director or to USDA’s Office of the

Inspector General at (800) 424-9121 for investigation or other appropriate action.

L. Civil Rights and Equal Opportunity. AMS requires boards to establish civil rights

policies and procedures, approved by AMS, to prohibit unlawful discrimination and

retaliation. Boards must comply with applicable Federal, State, and local laws regarding

civil rights and equal employment opportunity.

In accordance with civil rights policies, boards must maintain an environment where:

• Employees are treated with respect and in a professional manner.

• Conflicts and complaints are resolved quickly.

• Employees and supervisors are able to discuss concerns openly without reprisal, or

retaliation.

• Employees, at every level, demonstrate a commitment to civil rights and equal

opportunity for everyone through their work and actions.

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Board employee right to file with EEOC

Board policies and procedures should inform employees of how they may report allegations

of unlawful discrimination, retaliation, sexual harassment, violence, and other misconduct,

and provide a process by which the board will investigate allegations internally. Board

policies and procedures should also inform employees of their right to file a complaint with

the U.S. Equal Employment Opportunity Commission and applicable state Fair

Employment Practice Agency.

Board employee complaint against a Board Member

AMS has the responsibility to investigate and address all allegations of civil rights or equal

opportunity violations, sexual harassment, violence, and other misconduct perpetrated by a

board member. However, AMS’ responsibility to investigate does not confer any rights to

board employees under the federal Equal Employment Opportunity statutes.

Board employee complaint of program discrimination

Under certain limited circumstances, a board employee may have the right to assert a

program discrimination claim with AMS under Title VI of the of the Civil Rights Act of

1964. Board employees should contact AMS Civil Rights at 202-690-3640 for more

information on filing a program discrimination complaint under Title VI of the of the Civil

Rights Act of 1964.

M. Other Government Agencies. AMS serves as the boards’ liaison to other Federal

Government agencies, with the exception of FAS if the board is a cooperator under FAS

programs. AMS requires boards to provide advance notice of meetings with any other

Federal Government agencies and must pre-approve all meetings and be aware of

communications with those agencies. AMS must pre-approve any correspondence,

including comments on Federal rulemaking.

AMS will develop appropriate working relationships with other Government agencies that

have responsibilities related to these programs. For example, FAS has oversight

responsibility of the Foreign Market Development (FMD) and the Market Access Program

(MAP), and checkoff funding is made available to some participants in these FAS-

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supervised programs. AMS commodity programs will assure close coordination with the

FAS any time checkoff funds are used for international marketing activities. However, in

all cases, FAS must have the opportunity to approve the boards’ budgets, plans, and

projects that focus on international activities, including international travel. Approval will

be subject to compliance with the checkoff legislation as well as other FAS requirements.

Likewise, for programs with import checkoff provisions, it is the responsibility of AMS

commodity programs to maintain a close liaison with the Customs and Border Protection of

the U.S. Department of Homeland Security. Similarly, as required by section 1999T of the

Food, Agriculture, Conservation, and Trade Act of 1990, AMS will inform the United

States Trade Representative on any proposed new or amended research and promotion

order or plan which would assess imports.

N. Unemployment Practices. On April 17, 1992, the Department of Labor (Labor)

determined that employees of research and promotion boards and marketing order

committees, which are under USDA’s supervision, perform “Federal Service” for

Unemployment Compensation for Federal Employees (UCFE) Program purposes (UCFE

Program Coverage Ruling No. 92-1).

Employees of boards and committees listed in Labor’s (UCFE) Instructions for Federal

Agencies whose employment has been separated from the board and seek to file a claim

should contact their respective AMS Commodity Program for instructions about the

unemployment compensation procedures on the employee’s last day.

O. Records Retention. If not established in authorizing legislation, boards will develop

record retention policies, approved by AMS, for all documents and electronic mail for

which AMS has not established a requirement. Individuals receiving reimbursement from a

board for travel expenses must maintain original receipts (electronic copies are acceptable)

for a period of 3 years.

Boards possess information that demonstrates their adherence to their authorizing Acts,

Orders, the Guidelines, and related AMS directives. Such records must be retained and be

available for AMS to conduct proper oversight of board activities. As such, the records

must be maintained for a period of time of no less than 3 years to enable AMS personnel to

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review necessary documents during AMS Management reviews. Maintenance of electronic

records of receipts and electronic program records will comply with this requirement if the

electronic system of records is approved by AMS. Note that AMS approval of record

retention policies pertains solely to records subject to AMS review for purposes of the

oversight responsibilities of AMS. Neither the Guidelines nor board policies approved by

AMS supersede other record retention requirements that may apply to the boards, including

Federal, State, and local laws or orders by a court of competent jurisdiction.

Appendix 1 – Authorizing Legislation

Appendix 2 – Statement of Principle for Research and Promotion Boards and Marketing Orders for

Information Sharing with Government Officials

Appendix 3 – AMS Directive: Investment of Public Funds

Appendix 4 – AMS Directive: Debt Management

Appendix 5 – Research and Promotion Boards

Appendix 6 – Requirements for Outside Counsel Legal Services Contracts

Appendix 7 - Marketing Communication Guidelines for Program Advertising, Promotional

Material, Research, Social Media, and Other Publications

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APPENDIX 1

AUTHORIZING LEGISLATION

• Commodity Promotion, Research, and Information Act of 1996 (7 U.S.C. 7411-7425)

o Blueberry

o Christmas Trees

o Honey

o Lamb

o Mangos

o Paper and Packaging

o Peanuts

o Softwood Lumber

o Sorghum

• Beef Research and Promotion Act (7 U.S.C. 2901-2911)

• Cotton Research and Promotion Act (7 U.S.C. 2101-2118)

• Dairy Production Stabilization Act of 1983 (7 U.S.C. 4501-4514)

• Egg Research and Promotion Act (7 U.S.C. 2701-2718)

• Fluid Milk Promotion Act (7 U.S.C. 6401-6417)

• Hass Avocado Promotion, Research, and Information (7 U.S.C. 7801-7813)

• Mushroom Promotion, Research, and Consumer Information Act of 1990 (7 U.S.C.

6101-6112)

• Popcorn Promotion, Research, and Consumer Information Act (7 U.S.C. 7481-7491)

• Pork Promotion, Research, and Consumer Information Act of 1985 (7 U.S.C. 4801-

4819)

• Potato Research and Promotion Act (7 U.S.C. 2611-2627)

• Soybean Promotion, Research, and Consumer Information Act (7 U.S.C. 6301-6311)

• Watermelon Research and Promotion Act (7 U.S.C. 4901-4916)

• Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7401)

• Other statutes and regulations, as applicable

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APPENDIX 2

Statement of Principle for Research and Promotion Boards and Marketing Orders for

Information Sharing with Government Officials

This document clarifies AMS policy regarding Research and Promotion and Marketing Order

Boards (Boards) communication with government officials. For the purpose of this document,

‘government officials’ refers to federal employees outside of USDA, foreign and State

governments/officials, legislators, and legislative staffs. AMS is committed to providing consistent

application of these oversight principles. While this document does provide clarification, it is also

important that boards adhere to their respective Acts, Order, rules/regulations and USDA/AMS

policy documents.

Boards have expressed a growing concern that many audiences do not fully understand their roles

and functions, or AMS’s oversight. Whether by statute or AMS policy, Boards are not able to use

assessment funds to influence legislation or government policy. However, it has been longstanding

AMS policy to allow Boards to share factual information with government officials under certain

conditions:

• Prior approval is obtained from AMS for the information to be provided to ensure that it

does not influence legislation or government policy; previously approved materials do not

require re-approval.

• For recurring or standalone educational sessions with government officials, meeting

arrangements should be reviewed in advance with AMS. In exceptional cases, AMS may

also consider factors such as location and timing of the meeting as part of the review

process.

• A disclaimer is provided during discussions or on materials that outlines what Boards can

and cannot do. For example, “Information is provided for educational purposes and is not

intended to influence legislation or government policy.”

• Boards are not expected to request advance approval when responding to a direct and

immediate request (e.g., phone call, email) for information but should remind the inquirer

of their role. For example, if a Board receives a phone call from a State Congressman’s

office asking for information about a particular research program funded by the Board, the

Board should provide the information directly with appropriate disclaimers.

This guidance is intended to cover the majority of routine, ongoing interactions between Boards

and government officials. For more significant and infrequent events – such as showcases with

multiple Boards – consideration will be elevated to AMS’s Research and Promotion Functional

Committee and the administrator’s office.

(September 25, 2019)

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APPENDIX 3

United States Department of Agriculture

Marketing and Regulatory Programs

Agricultural Marketing Service

Directive AMS 2210.2

2/7/11

INVESTMENT OF PUBLIC FUNDS

1. PURPOSE

This Directive states the policy and responsibilities for investment of public funds

maintained by the Agricultural Marketing Service (AMS).

2. REPLACEMENT HIGHLIGHTS

This Directive replaces AMS Directive 2210.2, Investment of Public Funds, dated August

2005.

3. AUTHORITIES

a. Title 31, Code of Federal Regulations (CFR), Parts 202-226, Money and Finance:

Treasury.

b. Volume I, Treasury Financial Manual 6-9000, Securing Government Deposits in

Federal Agency Accounts.

4. DEFINITIONS OF TERMS

a. Agency. Any department, agency, or instrumentality of the U.S.

Government.

b. Designated Depositary. A financial institution designated by the

Department of the Treasury as a depositary and financial agent of the Federal

Government which has been selected by an agency to hold public funds.

c. Federal Reserve Districts and Banks. The Federal Reserve Bank or branch

of the district within the geographic area where the agency’s des

ignated

depositary

is located.

d. Government Deposits. Public money, including, but not limited

to,

revenue

and funds of the United States and deposited funds subject to the control

or regulation of the United States or any of its officers, agents, or employees.

e. Recognized Insurance Coverage. The insurance provided by the Federal

Deposit Insurance Corporation (FDIC), National Credit Union Share Insurance

Fund, and

Page 36

the insurance organizations specifically approved by the Secretary of the

Treasury under Title 31, CFR, Part 226.

5. POLICY

It is AMS policy to:

a. Exercise prudent cash management of funds collected

through: (1) Fees for services,

(2) Assessments from handlers and producers to finance

research and promotion efforts, and

(3) Assessments to administer marketing agreements and orders.

This also applies to payments received by producer settlement funds

and interest or other charges collected on overdue accounts.

b. Require that a formal agreement or Memorandum of Understanding

be signed between parties before funds are deposited with a financial

institution. This agreement is to state the responsibilities of both the

custodial agency and the financial institution, and must conform with the

policies and guidelines established by the U.S. Treasury with respect to the

deposits of, and collateral for, public funds.

c. Require complete safety of invested funds. In this regard, AMS adheres

to U.S. Department of the Treasury Regulations, Title 31, CFR, Parts 202-226.

6. RESPONSIBILITIES

a. The fund custodians for AMS who maintain public funds are the Budget

Division, the Research and Promotion boards, Milk Market Administrators,

and

the

Fruit and Vegetable Marketing Order Administrative Committees. When

investing funds held in public trust, fund custodians must follow these

guidelines:

(1) Investments. All investments must be short-term, risk-free,

interest- bearing instruments.

(a) Short-Term. All investments must have a maturity period of

1 year or less to ensure availability and rapid conversion of

the principal to cash.

(b) Risk-Free. All investments must be federally insured or

fully collateralized with Federal Government securities.

(2) Insurance Coverage. All investments must be fully secured. Accounts are to

be established at financial institutions having FDIC insurance which protects the funds

Page 37

depositor’s place in banks and savings associations. Accounts at individual institutions

should not exceed, in the aggregate, FDIC insured thresholds in order to ensure full

insurance for both account principal and interest. The standard insurance amount

currently is $250,000 per depositor through December 31, 2013. On January 1, 2014,

the standard insurance amount will return to $100,000 per depositor for all deposit

accounts.

(3) Collateralization. All investments exceeding FDIC insured thresholds,

within said institutions, must be fully collateralized.

(a) Before sending funds to an institution for investment, eligible

collateral must be pledged to an account under the control of the investing

custodian.

(b) Only those securities specified in U.S. Department of the Treasury

Regulations, Title 31, CFR, Part 202, are acceptable collateral. They include

securities issued, fully insured or guaranteed by U.S. Government agencies, or

U.S. Government-sponsored corporations. Regulations that govern the types

of acceptable collateral that may be pledged to secure deposits of

public

monies, as well as the valuation of that collateral are addressed

in

Title

31

CFR, Part 380. For a current list of acceptable classes of securities and

instruments described within this Code and their valuations,

see the Bureau of the Public Debt’s website at

www.publicdebt.treas.gov.

(c) Collateral must be pledged at face value. Financial institutions

must provide the investor with quarterly inventories of pledged collateral

showing both face and market value.

(d) Pledged collateral must be separately segregated in the name of the

investor (i.e., AMS-Budget Division, board, Milk Market Administrator, or

Administrative Committee), in order to prevent double pledging.

(e) Collateral not held by the Federal Reserve Board must be held by a

financial institution authorized by Treasury as a Federal

Depositary, having FDIC insurance, and approved by the Federal

Reserve Board.

(f) Investment records must be maintained for 6 years and 3 months, as

required by the AMS Records Management Program.

b. The Planning and Accountability Division, AMS, will conduct a biennial review

of the investment decisions process for the AMS investment program.

Investment authorities outside of the AMS investment program will continue to

be reviewed as outlined in their investment authority. The Budget Division will

issue quarterly investment letters that will apprise committee members of their

investment earnings. The Budget Division will also host an annual meeting with

the Investment Committee to provide an overview of the investment program

activities.

Page 38

c. On an annual basis, all employees authorized to conduct business

with

any

financial institution participating in the AMS investment program must complete an

AMS Investment Program Disclosure Statement Form which indicates any personal

relationships with those financial institutions with which business is conducted.

d. The Budget Program and Analysis Branch Chief and the AMS Budget

Officer share the responsibility of approving daily investment decisions respectively.

In their absence, acting staff (GS-13 and above) assume these responsibilities provided

they have signed disclosure statements and have confidential disclosure reports on file.

7. INQUIRIES

a. For further information, please contact the AMS Budget Office.

b. This Directive is available online at http://www.ams.usda.gov/amsissuances

/s/

Ellen King

Deputy Administrator

Compliance and Analysis Programs

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APPENDIX 4

United States Department of Agriculture

Agricultural Marketing Service

Directive

May 10, 2004

Re: AMS Debt Management Directive 420.3

The Agricultural Marketing Service (AMS) Debt Management Directive, 420.3 is being

revised. Most of the debt management policies listed in the current version of 420.3 are still

applicable. Since AMS converted to the Federal Financial Information System (FFIS)

procedural references related to the Billings and Collections system (BLCO) are no longer

applicable and are the major reason for the revision.

An outline summary of the revised directive is as follows:

I. PURPOSE

A. States the AMS policy on the recording, monitoring, analyzing, reporting and

disposition of program and administrative accounts receivable.

B. Delegates to Program Deputy Administrators the authority to write off

uncollectible accounts receivable up to $500 (threshold amount under review as

part of Directive revision).

II. REPLACEMENT HIGHLIGHTS

This Directive will replace AMS Directive 420.3, Debt Management, and dated

6/29/87.

III. POLICY

Debts owed the Federal Government shall be recorded, monitored, and pursued in a

manner that protects the interest of the Government and promotes the ability of AMS

programs to provide services to the public.

IV. AUTHORITY

A. Federal Claims Collection Standards (Code of Federal Regulations 4, Chapter II).

B. Code of Federal Regulations 7, Part 3.

Page 40

V. APPLICABILITY

This directive applies to debts or claims owed to AMS by individuals (including

employees), commercial entities or corporations, and States and

possessions. Amounts owed by Federal agencies are excluded.

VI. RESPONSIBILITIES

Programs and Administrative Staffs must:

1. Produce bills at least monthly.

2. Monitor and analyze the status of billings and collections.

3. Take action as necessary on billing and collection problems.

VII. DELINQUENCIES

A. Delinquencies must be aggressively and promptly pursued.

B. Deputy Administrators or their designees may write off up to $500 of a debt

(amount under review) if they feel it is in their program’s best interests to do so.

Page 41

APPENDIX 5

Research and Promotion Boards

• Beef Cattlemen’s Beef Promotion and Research Board

• Blueberries U.S. Highbush Blueberry Council

• Christmas Trees Christmas Tree Promotion Board

• Cotton Cotton Board

• Dairy National Dairy Promotion and Research Board

• Eggs American Egg Board

• Fluid Milk National Fluid Milk Processor Promotion Board

• Hass Avocados Hass Avocado Board

Peruvian Avocado Commission

California Avocado Commission

Chilean Avocado Importers Association

Mexican Hass Avocado Importers Association

• Honey National Honey Board

• Lamb American Lamb Board

• Mangos National Mango Board

• Mushrooms Mushroom Council

• Paper and Packaging Paper and Packaging Board

• Peanuts National Peanut Board

• Popcorn Popcorn Board

• Pork National Pork Board

• Potatoes National Potato Promotion Board

• Softwood Lumber Softwood Lumber Board

Page 42

• Sorghum United Sorghum Checkoff Program

• Soybeans United Soybean Board

• Watermelons National Watermelon Promotion Board

Page 43

APPENDIX 6

Requirements for Outside Counsel Legal Services Contracts

Outside counsel contracts must cover legal services only. If other authorized services are to

be provided, the board should enter into a separate contract, to be approved by the AMS

Program area, to cover those services. The outside counsel contract must include the

following provisions:

1. Duration of representation with starting and ending dates of the representation.

2. Detailed description of the legal services the outside counsel will provide, i.e. the scope

of the representation.

a. The contract may provide for modification of those services. Should the contract

permit modification, the contract also must state that modifications must be

approved by OGC in advance.

3. Billing provisions that specify:

a. Allowable costs and expenses

b. Billable rates for attorneys

c. Tasks performed during the billing cycle will be included in the billing invoice

4. Oversight Provisions that provide:

a. Contract is not valid until approved by USDA

b. Statement of relevant statutory and regulatory oversight (the Act and the Order)

c. Outside counsel will retain records for a minimum of three years; USDA and the

board have the right to inspect the records during business hours

d. USDA has oversight of the board; oversight is not limited by the contract for

outside counsel

e. USDA-OGC has final decision-making authority on all legal matters involving

the board; attorney-client confidentiality between outside counsel and the board

extends to USDA OGC

f. Outside counsel will not commence litigation services without the written consent

of OGC; contract will not contain language broadly permitting outside counsel to

perform litigation services, including e-discovery.

g. Outside counsel will ensure that potential or actual violations of law or

regulations involving the checkoff of which counsel is aware, including violations

by board members, are disclosed to AMS as soon as possible, but not later than 5

business days after counsel becomes aware of the actual or potential violation.

h. Outside Counsel shall not engage in activities designed to influence government

policy or action on behalf of the board

i. Outside counsel agrees to abide by Federal civil rights laws and USDA civil

rights regulations.

Page 44

5. Termination clauses providing that USDA or the board may terminate the representation

at any time; contract language may indicate boards will pay for all work performed under

contract until date of termination, and if the contract is terminated, outside counsel agrees

to return all information provided to counsel

Contracts must not include:

1. Indemnification provisions.

2. Liquidated Damages.

Examples of authorized legal services:

• Corporate governance and compliance oversight;

• Drafting and/or revising board bylaws, parliamentary procedures, and policies;

• Drafting proposed language for recommended changes to the Order;

• Assisting in coordinating the activities of regional and state organizations;

• Antitrust compliance;

• Advertising/privacy/internet law counseling and review of advertising materials and

advertising and nutrition claims (however, all advertising material must be

approved by AMS);

• Risk management training for board members and board employees to minimize the

legal risks of actions taken by the board, including risks related to employment law,

fiduciary responsibility and the Freedom of Information Act;

• Drafting statements of claim in bankruptcy;

• Contracts and addenda negotiations, drafting and administration;

• Assisting the board with developing and implementing procedures to ensure

contractor legal compliance with board policies, and USDA statutes, regulations and

guidelines governing the board’s activities;

• Tax law counseling and preparation of tax materials;

• Preparing banking documents;

• Negotiation and drafting of commercial real estate leases;

• Employment law counseling and personnel/employment issues or procedures;

• Employment compensation arrangements/agreements;

• Business regulation and licensing;

• Legal advice on compliance with federal, state and local regulations;

• Intellectual property counseling, registration, licensing and protection;

• Pre-litigation dispute and resolution counseling, with notification to AMS if there is a

likelihood of litigation or legal action.

Not authorized (non-legal/oversight services):

• Services designed to influence government policy or action

• Risk management oversight

• Manage and track approvals of materials by USDA

Strategic planning

Marketing Communication Guidelines – March 2018 Page 45 of 119

APPENDIX 7

Marketing Communication Guidelines

for Program Advertising, Promotional Material,

Research, Social Media, and Other Publications

This document provides guidelines for Agricultural Marketing Service’s (AMS) Research and

Promotion (R&P) and Marketing Order (MO) boards, committees, and councils (Boards) for the

review and approval of promotional and educational materials (marketing communications).

Marketing communications include, but are not limited to, research, advertisements (print ads,

web banner ads, mailed ads, television and radio spots, and advertorials), public relations

materials, consumer information, social media content (Websites, Facebook, Twitter, YouTube,

blogs, etc.) press releases, consumer information, articles for publication (e.g. magazines), and

industry newsletters, with the exception of internal Board communications.

AMS will review all promotional and educational materials of Boards, approving those in

compliance with the applicable legislative authority and USDA policy. No communication

materials or campaigns can be implemented prior to AMS approval.

Note: Despite the many guides and references at AMS’s disposal, marketing communications

remain an area that requires much analysis. Materials are reviewed on a case-by-case basis.

As much as possible, points to consider are detailed below. Questions should be referred to the

designated AMS representative, as AMS is responsible for the final approval of all materials.

Boards will submit, at a minimum, the following materials for AMS review and approval:

Marketing communication materials, including advertising, public relations materials, press

releases, consumer information, educational materials, industry newsletters, and social media

content (Websites, Facebook, Twitter, YouTube, blog entries, etc.), hereinafter referred to as

“materials.” Advertising generally includes materials in print, online, or other media, web banner

ads, mailed advertisements, television and radio spots, videos, and advertorials.

Regarding social media content, every Board will have a social media plan approved by AMS.

The content and information in social media outlets must be pre-approved or be part of

previously approved materials. Additional guidance regarding social media content is detailed in

Appendix D.

When evaluating materials, AMS will consider the following:

Authority

Marketing Communication Guidelines – March 2018 Page 46 of 119

Table 1: Federal Agencies, Statutory Authority, and Resources

Agency

Authority Resources

FDA

Food labeling (includes point-of-

purchase materials)

Reference or Daily Values (%DVs)

for Nutrition Labeling

Nutrient content definitions

Health claims on food labels

(FDA has responsibility for claims

on product labeling, including

packaging, inserts, and other

promotional materials distributed at

the point of sale. Implied health

claims fall in this category).

Food Safety

Product Recalls

21 CFR 101 (food labeling

regulations)

Nutrition Labeling Education Act

(NLEA)

Guidelines for Voluntary Nutrition

Labeling of Raw Fruits and

Vegetables

FDA Website for “Food Labeling

and Nutrition”

Food Safety Modernization Act

FDA Website for product Recalls

FTC

Prohibits deceptive and unfair acts

or practices in commerce

All forms of marketing, for all

products and services

Includes environmental claims

Includes claims in food marketing

(traditional ads, social media, PR,

Internet; generally defers to FDA on

claims in food labeling)

Works closely with FDA to align

nutrient content and health

messages

No pre-market approval of nutrient

or health claims

Enforcement Policy Statement on

Food Advertising

Generic Copy Test of Food Health

Claims in Advertising

FTC Guides Concerning the Use of

Endorsements and Testimonials in

Advertising

Dietary Supplements: An

Advertising Guide for Industry

Advertising and Marketing on the

Internet: Rules of the Road

.com Disclosures: How to Make

Effective Disclosures in Digital

Advertising

Guides for the Use of

Environmental Marketing Claims

(“Green Guides”), 16 CFR Part 260

Marketing Communication Guidelines – March 2018 Page 47 of 119

The Food and Drug Administration (FDA) and the Federal Trade Commission (FTC) share

jurisdiction over food marketing. By agreement, FDA has primary responsibility for claims

made in food labeling and the FTC has primary responsibility for claims made in other forms of

advertising and marketing.

All food claims, whether in labeling, advertising, or other marketing, must be truthful, accurate,

not misleading, and substantiated. The FTC defers to FDA labeling regulations pertaining to

definitions of nutrient content claims. The FTC also gives great deference to FDA

determinations of adequate support for a health claim. Health claims that meet FDA’s

“significant scientific agreement” (Defined under Appendix C-Research Communication

Guidance) standard will be presumed substantiated under FTC law. Health claims that must be

qualified under FDA labeling law because of limitations or uncertainty in the supporting science

will be allowed in advertising only if those limitations are clearly communicated and understood

by consumers. When disclosure of qualifying information is necessary to prevent a claim from

being deceptive, the disclosure must be clear and conspicuous.

Table 1 shows the Federal agencies with authority over the types of materials and/or the content

of those materials that Boards might develop, along with resources that reflect those agencies’

The FTC’s Endorsement Guides:

What People Are Asking

USDA

Nutrient data in foods

Recommended Daily Values for

nutrients, Dietary Guidance for

Americans

USDA National Nutrient Database

for Standard Reference

Dietary Reference Intakes and

Recommended Dietary Allowances

U.S. dietary guidance

Dietary Guidelines for Americans

Organic claims

National Organic Program

Food Safety

How commodity was raised or

grown

FSIS Fact Sheet for Meat, Poultry

and Egg products

Other USDA policy

Government speech of Boards

Influencing government policy

Image of President or White House

Statutes governing Boards

Guidelines for AMS Oversight of

Commodity Research and

Promotion Programs

White House policy

Disparagement, other issues

Marketing Communication Guidelines – March 2018 Page 48 of 119

regulations and policies. There may be other resources not listed below that AMS may allow

Boards to use provided they document the source of the information and obtain AMS approval.

Questions and Considerations:

When evaluating marketing communications, AMS considers the following:

• What is it? Is it advertising or food labeling, or is it something else?

• Who is the targeted audience? How and where will it be used? How will it be distributed?

• Is a claim being made? If so, what is the claim; what type of claim (nutrient-content,

health, structure-function, environmental)?

• Is the communication truthful and non-misleading?

• Does the communication include a comparison? If so, is it a factual comparison of like

or competing products?

• Are appropriate disclosures noted?

• Does it mention other commodities or competitors?

• Does it mention government action or an official?

• What is the overall takeaway or net impression?

I. Usage

Key Points:

• Determine how materials will be used and what latitude is appropriate.

• Required disclosures must be clear and conspicuous, regardless of the medium. That

means easily able to be read or heard and in close proximity to the claim.

• Net impression is key--What is the overall takeaway?

AMS will base its decision on how the program intends to use and distribute the materials.

AMS will evaluate advertising with the strictest eye because of its nature, which is to grab

viewer attention quickly and in a short amount of time. On the other hand, consumer information

publications and public relations materials (such as news releases) have more flexibility because

there is more time to delve into the story. In all cases, every effort should be made to ensure the

information released by Boards is not factually untrue, misleading, or deceptive.

Example:

In an ad, the claim: “Almonds contain calcium. A nutrient that helps build strong bones.” would

be prohibited, because a serving of almonds is not a good source of calcium. “Contains” is a

synonym for “good source.” Additionally, nutrient content claims require disclosure of risk-

increasing nutrients.

Marketing Communication Guidelines – March 2018 Page 49 of 119

The claim: “Almonds contain 8% DV of calcium. A serving of almonds has 13 grams of

unsaturated fat and 1 gram of saturated fat.” would be allowed. The amount of calcium is

specified; therefore, the statement does not imply that almonds are a good source of the nutrient.

Also, the fat content is disclosed.

In an ad, the claim: “Avocados contain vitamin E, an antioxidant that protects the body tissue

from damage and helps keep the immune system strong.” would be prohibited, because a serving

of avocados is not a good source of vitamin E. Contains is a synonym for “good source.”

The claim: “Avocados contain 6% DV of vitamin E. An antioxidant that protects the body tissue

from damage and helps keep the immune system strong.” would be allowed. The amount of

vitamin E is specified; therefore, the statement does not imply that avocados are a good source of

the nutrient.

In an ad, the claim: “Cottonseed oil is rich in antioxidants, has zero trans-fat, and zero

cholesterol which places it among the heart-healthy cooking oils on the market today.” would be

prohibited because to make a health claim (“heart-healthy”), any one of the four risk-increasing

nutrients cannot be present in an amount that exceeds the threshold set by FDA. For cottonseed

oil, the fat and saturated fat exceed the threshold. Additionally, the claim does not specify which

antioxidant contributes at least 20% DV (“rich in”).

The claim: “Cottonseed oil is rich in vitamin E, has zero trans-fat and zero cholesterol.” would

be allowed with disclosure of risk-increasing nutrients.

In an ad, the statement “eggs contain folate” would be prohibited, because an egg is not a good

source of folate. – “Contains” is a synonym for “good source.”

The claim: “eggs are an excellent source of choline” or “eggs are rich in choline” would be

allowed because eggs contain at least 20% of the recommended daily value of choline.

In a consumer publication, the following claims would be allowed: Almonds are an excellent

source of vitamin E and magnesium, a good source of phosphorus, and contain 8% DV of

calcium. A serving of almonds has 13 grams of unsaturated fat and 1 gram of saturated fat.

[Almonds provide 35% DV vitamin E, 20%DV magnesium, 15% DV phosphorus, and the

amount of calcium is specified. Therefore, the nutrient content claims made are truthful. Also,

the fat content is disclosed.]

Food Packaging, Inserts, and Point-of-Purchase Materials

Under FDA food labeling regulations, food packaging, inserts, and point-of-purchase materials

(including shelf talkers, hang tags, and other signage) are considered food labeling. This means a

print ad placed on the shelf at the grocery store is not an ad at all; it is considered a food label

and must meet all of the criteria as such. Thus, AMS will review Board’s food packaging, inserts

Marketing Communication Guidelines – March 2018 Page 50 of 119

and point-of-purchase materials to ensure they are in compliance with FDA food labeling

regulations.

Digital Media

Rules for marketing claims apply across all media, whether delivered on a desktop computer, a

mobile device, or more traditional media such as television, radio, or print.

Regardless of the device or platform, a consumer may use to view an online ad, if a disclosure is

needed to prevent the ad from being deceptive or unfair, the disclosure must be clear,

conspicuous and placed as close as possible to the claim. If an ad without a disclosure would be

deceptive or unfair, and a disclosure cannot be made clearly and conspicuously on a device or

platform, then that device or platform should not be used. In the event of social media or

advertisement size restrictions, disclosure will be reviewed and considered on a case-by-case

basis and the communication must meet FTC requirements to be approved.

Hyperlinks

Hyperlinks that lead to disclosures or more information should be clearly labeled, and convey the

importance, nature and relevance of the information to which the links lead. Hyperlinks labeled

“disclaimer,” “learn more,” “details,” “click here for more information,” or similar, may not be

adequate and will be reviewed on a case-by case basis. Disclosures that are an integral part of a

claim, or that cannot be separated from it, should not be communicated through a hyperlink. This

applies to required disclosures about health and safety issues.

Disclosures or sources presented in online ads, television ads, video clips, etc., should appear for

a duration sufficient for consumers to notice, read, and reasonably understand them. FTC

requires disclosures on ads be easily legible, not “mouseprint,” and in close proximity to the

image or statement to which it provides clarity.

Boards should consider how their hyperlinks will function on commonly used software programs

and devices. Likewise, marketers should be aware of issues regarding the use of pop-ups to

disclose necessary information. For example, do not use blockable pop-up disclosures to convey

necessary information. Boards are responsible for using effective methods of communicating

information to consumers.

For more detailed information regarding digital advertising, please refer to FTC’s guidelines

(e.g., .com Disclosures: How to Make Effective Disclosures in Digital Advertising). Disclosures

should follow these FTC guidelines, in addition to all applicable laws and USDA policies.

II. Audience

Marketing Communication Guidelines – March 2018 Page 51 of 119

Another factor in reviewing materials should be the intended audience. For example, materials

targeted to general consumers vs. materials targeted toward health practitioners whose

understanding of health issues is more advanced.

A. Consumers are generally considered the end users. They understand terms like “good

fat” and “bad fat.” They generally do not understand more technical

nutrition/biochemistry and/or research terms like HDL/LDL.

B. Industry Customers and Trade include producers, growers, importers, manufacturers,

research and development personnel, and trade (such as retailers, foodservice

distributors and operators). This audience generally has technical support and research

and development functions available to them. They are particularly interested in

customer perception and profitability. Science is valuable to position their product.

C. Experts and Influencers include health and nutrition experts and professionals,

researchers, influencers, food editors, and press. They understand scientific language

(e.g. poly and mono-saturated fat) or other industry-specific terminology. Materials

targeted to this audience often discuss scientific research. Materials are more detailed

and should specify the source for this audience.

III. Claims

AMS will review claims made in materials and ensure they are accurate, not misleading, and not

deceptive.

Key points:

• Use no false, misleading, or deceptive statements.

• Identify all expressed and implied claims. Claims that could not be made overtly and

cannot be implied or suggested.

• Claims must be adequately supported.

• Net impression is key--What is the overall takeaway?

Interpretation and Substantiation

Section 5 of the FTC Act prohibits deceptive acts and practices in or affecting commerce. A

representation, omission, or practice is deceptive if it is likely to mislead consumers acting

reasonably under the circumstances and is material to consumers' decisions. See FTC Policy

Statement on Deception, 103 FTC 174 (1983). To determine if an advertisement is deceptive,

marketers must identify all express and implied claims that the advertisement reasonably

conveys. Marketers must ensure that all reasonable interpretations of their claims are truthful, not

Marketing Communication Guidelines – March 2018 Page 52 of 119

misleading, and supported by a reasonable basis before they make the claims. See FTC Policy

Statement Regarding Advertising Substantiation, 104 FTC 839 (1984).

The types of food claims to be evaluated are:

A. Nutrient-Content Claims

Nutrient-content claims characterize the level of a nutrient in a food, through expressed or

implied statements. FDA’s updated Daily Reference Values (DRVs) and Reference Daily

Intakes (RDIs) are used to calculate the % Daily Value per serving of nutrients. Please refer to

Appendix B for definitions and additional guidance.

Key points:

• In advertising, FTC follows definitions found in the FDA food labeling regulations, but

allows the use of undefined FDA terms. Claims that may be allowed in advertisements

may not necessarily be permitted by FDA on a label.

• Nutrient-content claims must be accurate and supported by data from the USDA Nutrient

Database or FDA’s Guidelines for Voluntary Nutrition Labeling of Raw Fruits and

Vegetables.

• Nutrient content claims must be based on the serving size or the Reference Amounts

Customarily Consumed per eating occasion (RACC). The RACC represents one serving,

and is established by FDA 21 CFR § 101.12.

• General guide for % Daily Value of nutrients of a food per RACC:

o “good source,” “contains,” or “provides” means 10-19% Daily Value per RACC;

o “excellent source,” “high,” or “rich in” means 20% or more Daily Value per

RACC.

• For nutrients for which there is no established Daily Value (e.g., antioxidants, omega-3

fatty acids), claims must only specify the amount of the nutrient per RACC, and must not

imply the level of the nutrient in the product.

• For nutrients with less than 10% Daily Value, claims must specify the amount of the

nutrient per serving size or RACC.

• Ensure implied claims are not misleading.

• Good source, high, relative, implied, specified amounts, and other nutrient claims should

be consistent with FDA regulations.

Expressed nutrient content claims

These claims directly state the level (or range) of a nutrient in the food.

Examples:

Marketing Communication Guidelines – March 2018 Page 53 of 119

• Low sodium

• 100 calories

• Excellent source of fiber

• 6 g protein

• Low in fat

• Contains vitamin E

Implied nutrient content claims

These claims imply a level of a nutrient in a food without expressly stating it. These types of

claims are prohibited when they wrongfully imply that a food contains or does not contain a

meaningful level of a nutrient.

Examples:

• Made with oat bran

A claim that a food contains or is made with an ingredient known to contain a particular nutrient

(in this case, fiber) may be made if the product is a “good source” of the nutrient associated with

the claim. This claim would be allowed if the product contains enough oat bran to be a “good

source” of fiber.

• No tropical oils

A product claiming to contain no tropical oils would be allowed only on foods that are “low” in

saturated fat because consumers have come to equate tropical oils with high saturated fat.

• A healthy snack

A product may be referred to as healthy or related terms (e.g., ‘‘health,’’ ‘‘healthful,’’

‘‘healthfully,’’ ‘‘healthfulness,’’ ‘‘healthier,’’ ‘‘healthiest,’’ ‘‘healthily,’’ and ‘‘healthiness’’) if

it meets the FDA criteria for fat, saturated fat, cholesterol, and other nutrients.

https://www.fda.gov/Food/GuidanceRegulation/GuidanceDocumentsRegulatoryInformation/ucm

521690.htm

Other examples:

• Almonds provide 6 grams of power-packed protein

This claim would be allowed. The amount of protein is specified, and “power-packed” describes

“protein.”

• Nut x is packed with protein

This claim would only be allowable if the product is an excellent source of protein.

Nutrient Data:

Marketing Communication Guidelines – March 2018 Page 54 of 119

AMS review of nutritional claims will include verification of supporting data to determine

consistency with the USDA National Nutrient Database for Standard Reference and other

pertinent Federal policies and guidance. Any other supporting data must be substantiated by the

Boards.

USDA’s Nutrient Database is available online.

AMS requires Boards to use the non-branded nutrient/product information contained in USDA’s

Nutrient Database as the Board programs are generic in nature. In certain cases, AMS may allow

Boards to use USDA’s branded nutrient database or nutrient data from sources outside of

USDA’s Nutrient Database if they document the source of the information (e.g., the laboratory)

and request AMS approval. Reasons might include obtaining data not available in the USDA

database or comparing products for which some data are not available in the USDA database.

USDA’s Agricultural Research Service (ARS), which administers the database, is open to

receiving new data from industries to facilitate keeping the database updated. There are

requirements for obtaining this data, and AMS will contact ARS for those requirements if a

Board wishes to fund the research.

“Use of Antioxidant Data and polyphenol research (Oxygen Radical Absorbance Capacity

(ORAC) or similar values):

Boards will be allowed to cite ORAC or similar values for their individual product or commodity

since the ORAC research and similar research is published literature. However, the use of these

values must be accompanied by the following disclaimer:

“The data for antioxidant capacity of foods generated by test-tube methods cannot be

extrapolated to human effects. Clinical trials to test benefits of dietary antioxidants have

produced mixed results.”

USDA will not approve communications that include:

• Any implied health benefits based on the antioxidant levels; or

• Product comparisons using ORAC or similar values since such would imply a benefit

based on the antioxidant capacity level. “

Serving Sizes:

Nutrient-content claims must correlate to the serving size or RACC (Reference Amounts

Customarily Consumed in one eating occasion). In other words, amounts cannot be provided for

more or less than one serving, either to boost nutrient content (such as vitamins or minerals) or

lower it (such as fat or sodium).

B. Health Claims

Marketing Communication Guidelines – March 2018 Page 55 of 119

FDA regulations define health claims in 21 CFR 101.14 (a)(1) and (p). A health claim

characterizes the relationship of a nutrient or food to a disease or health-related condition.

Generally, the word “may” or “might” is used in discussing the relationship of the nutrient or

food to a disease or health-related condition. These claims are limited to disease risk reduction,

and the food must meet the requirements of the claim. Additionally, these claims cannot state the

degree of risk reduction (i.e., food x may reduce the risk of cancer by 40%).

USDA AMS follows FDA and FTC policy/guidance regarding authorized health claims and

qualified health claims used in marketing and nutrition related materials.

FDA regulations govern all health claims on food labels and in labeling of foods. Health claim

messages that are included in point of sale communications or materials that could potentially be

used as digital point of sale information must include the complete FDA approved health claim

statement(s). This health claim statement advises consumers about the context and other dietary

recommendations in which the health claim is made. FDA provides examples of model health

claim statements for each approved health claim. Similar statements may be made as long as the

requirements for that health claim are included. See 21 CFR 101.72 through 101.82 for

approved health claims. For additional information, see 21 CFR 101.14 (a)(1) and (p) and

Appendix B: FDA Defined Terms and Marketing Terms.

FTC allows more flexibility with health claims in marketing and other materials than FDA

allows on food packaging, inserts and point-of-purchase materials. Note: Point-of-purchase

materials are considered labeling, not promotional materials. AMS will review Board point-of-

purchase materials to ensure they are in compliance with FDA regulations.

Key Points:

• Health claims in advertising and other marketing should comply with FTC law. Health

claims should be: (1) supported by competent and reliable scientific evidence (i.e.,

randomized controlled human clinical testing); (2) consistent with the larger body of

scientific evidence; and (3) adequately qualified as necessary to clearly communicate any

significant limitations on the supporting science. Health claims authorized by FDA

pursuant to the significant scientific agreement standard are presumed to comply with

FTC substantiation standard.

• Disclose the amount of any risk-increasing nutrients (fat, saturated fat, cholesterol,

sodium).

• Ensure materials are not misleading or deceptive.

• Watch implied claims.

• No “medical” claims portraying a commodity as a “drug” with a therapeutic effect are

allowed. The words “cure,” “mitigate,” “treat,” “reverse,” or “prevent,” even if

Marketing Communication Guidelines – March 2018 Page 56 of 119

modified by “may” are not permitted because these words redefine the substance as a

drug. This includes “lowers cholesterol.”

• What is the overall takeaway?

Appendix C details USDA guidelines related to the communication of research.

Disclosure Nutrient Levels and Disqualifying Nutrient Levels, as defined by FDA:

For nutrient content and health claims, any one of the four risk-increasing nutrients cannot be

present in an amount that exceeds the threshold set by FDA, unless FDA provides for an

exception. These disclosure and disqualifying nutrient levels (which are the amounts beyond

which a claim is disqualified) are:

• Fat 13 g

• Saturated fat 4 g

• Cholesterol 60 mg

• Sodium 480 mg

For foods with nutrients that exceed any of the above thresholds, nutrient content and health

claims may appear on a case-by-case basis in advertising if the amount of the risk-increasing

nutrient(s) is disclosed.

Examples of Acceptable Claims:

• Trans fats? Not in our house. “Nut X” has zero trans fats. In anyone's house."

Disclosure statement: "One serving of dry roasted “Nut X” (30 grams) contains 12 grams

of unsaturated fat, 2 grams of saturated fat, zero trans fats and no cholesterol."

• An ice cream label may not bear a calcium and osteoporosis health claim because the food

contains fat in an amount above the threshold.

Unless otherwise required, the nutrient must be present in at least a good-source amount to make

a claim. For example, a folate-neural tube defect cannot be made for a food that contains 4% of

the Daily Value for folate. (An exception to this good-source rule may be when research

indicates that a nutrient may be more bioavailable from one food than from a richer source. This

can be discussed in non-advertising materials where there is room to tell the full story.)

Example of Unacceptable Claim:

• USA-grown “Nut x”: a healthful treat (and no tricks).

Disclosure statement: “One serving of “nut x” contains 12 grams of unsaturated

fat and 2 grams of saturated fat, zero trans fats.

Marketing Communication Guidelines – March 2018 Page 57 of 119

Unacceptable claim because “Nut x” does not meet FDA’s definition of “healthy.” While the

mono and polyunsaturated fats constitute the majority of the total fat content per serving,

“Nut x” must still meet FDA’s healthy definition requirements for saturated fat (1 gram or

less per RACC serving) and cholesterol. “Nut x” also must provide at least 10% of the Daily

Value per RACC for one or more of the qualifying nutrients (vitamin A, vitamin C, calcium,

iron, protein, potassium, vitamin D or fiber). The term “healthful” is one of the derivatives

of “healthy.”

[This reflects FDA’s current enforcement discretion guidance on low fat and beneficial

nutrient criteria, which provides interim guidance regarding the use of the term “healthy.”

Thus, the criteria could change in the final rule.]

i. Authorized Health Claims

FDA has identified a number of relationships between a nutrient or food and the risk of a disease

or health-related condition. FDA authorizes health claims for those relationships in its food

labeling regulations.

https://www.fda.gov/Food/IngredientsPackagingLabeling/LabelingNutrition/ucm2006876.htm#a

pproved

Examples of authorized claims:

Calcium and osteoporosis

• Adequate calcium throughout life, as part of a well-balanced diet, may reduce the risk of

osteoporosis.

Potassium and the Risk of High Blood Pressure and Stroke

• "Diets containing foods that are a good source of potassium and that are low in sodium may

reduce the risk of high blood pressure and stroke."

Fiber-Containing Grain Products, Fruits and Vegetables and Cancer Risk

• Low fat diets rich in fiber-containing grain products, fruits, and vegetables may reduce the

risk of some types of cancer, a disease associated with many factors.

FDA has specifically not authorized several claims. For example:

• Dietary fiber and cardiovascular disease

• Zinc and immune function in the elderly

ii. Qualified Health Claims:

Marketing Communication Guidelines – March 2018 Page 58 of 119

Due to limited scientific evidence, the FDA approved or authorized claim statement must

accompany the claim, and the total fat disqualifying nutrient must be disclosed:

Example: Nuts and Coronary Heart Disease risk reduction:

• “Nut x may be good for your heart.”

o Acceptable with use of FDA qualified health claim statement, or a modified claim

statement in advertisements, and fat disclosure.

Claim Statement: "Scientific evidence suggests but does not prove that eating 1.5 ounces

per day of most nuts [such as name of specific nut] as part of a diet

low in saturated fat and cholesterol may reduce the risk of heart

disease.”

Disclosure statement: One serving of “Nut x” contains 12 grams of unsaturated fat and

2 grams of saturated fat, zero trans fats and no cholesterol.

Unless otherwise required, the nutrient must be present in at least a good-source amount (10 %

or more of the Daily Value) to make a claim. For example:

• A folate-neural tube defect cannot be made for a food that contains 4% of the Daily Value for

folate. (An exception to this good-source rule may be when research indicates that a nutrient

may be more bioavailable from one food than from a richer source. This can be discussed in

non-advertising materials where there is room to tell the full story.)

Unallowable claim:

• Eating walnuts may lower cholesterol

This is a drug claim—food products cannot be depicted to cure, mitigate or prevent diseases.

iii. Implied Health Claims

Health claims are not necessarily overt. They can be implied as demonstrated by the following:

• Heart symbol ♥ (which implies “healthy” or “heart-healthy” is only allowed when

commodity meets definition of these terms with its attributes)

• Heart symbol can be used to depict a love for the product, if no health claim is made,

implied, or associated with use of the heart symbol.

o For example: I ♥ milk!!

• Third-party reference (e.g., National Cancer Institute or American Heart Association)

• Vignettes or descriptions (e.g., “healthy, contains 3 g fat”)

Marketing Communication Guidelines – March 2018 Page 59 of 119

In ads, implied claims cannot be made when the overt claim could not be made.

Use in advertising and other materials

While FDA has strict rules for the use of health claims on food labels, FTC allows more latitude for health claims in

advertising and other materials.

For example, the FTC does not necessarily require a marketer to adhere

to the exact wording and all required elements of an FDA-authorized health claim in advertising, as

long as the claim is not deceptive and communicates any important qualifying information. For

additional guidance and examples of health claim messaging, see Appendix B

.

FTC closely follows FDA for health claim guidance, but it is possible for a health claim not yet

authorized by FDA to appear in advertising or other materials—especially other materials. With

advertising, there may not be adequate space and time to tell the full story.

When evaluating health claims in materials, points to consider are:

• Disclosures. Are they adequate? Is the full story presented?

• Significant scientific agreement. Is there significant scientific agreement? What does

the larger body of scientific evidence reflect? The claim should agree with the larger

body of scientific evidence.

• Overall takeaway. What is the overall takeaway of the ad or material? What would the

average reasonable consumer take away from the piece? Even if every statement is

technically true, FTC might deem a piece misleading or even deceptive because of the

overall takeaway.

C. Structure-Function Claims

A structure-function claim describes the role of a nutrient or dietary ingredient intended to affect

the structure or function in humans, provided it is not a disease claim. Structure-function claims

may be made on a conventional food provided the effects are derived from the nutritive value of

the food.

Examples:

• Calcium builds strong bones.

• Fiber maintains bowel regularity.

• Walnuts help maintain normal cholesterol.

These types of claims are not pre-approved by FDA. The manufacturer/labeler is responsible for

ensuring the accuracy and truthfulness of the claims. The claims must not be misleading.

D. Food Safety Claims

Marketing Communication Guidelines – March 2018 Page 60 of 119

USDA policy must be followed for all claims about food safety for meat, poultry and eggs. FDA

policy must be followed for all other claims. More detailed information is contained in

Appendix E.

E. Environmental Claims

FTC provides guidance for environmental claims in its Guides for the Use of Environmental

Marketing Claims (“Green Guides”).

Some terms to note:

• Sustainability

• Recyclable

• Organic

• Natural

More detailed information on FTC standards is contained in Appendix F and:

https://www.ftc.gov/news-events/press-releases/2012/10/ftc-issues-revised-green-guides.

IV. Disparaging/Comparative Advertising

AMS will not approve any advertising deemed disparaging to another agricultural commodity or

competing product or in violation of the prohibition against false and misleading advertising.

Disparagement is defined as anything that depicts other commodities in a negative or unpleasant

light via overt or subjective video, photography, or statements. The AMS Guidelines permit

comparative advertising, as long as the presentation of those facts is truthful, objective, not

misleading, and supported by a reasonable basis.

Questions and Considerations:

When evaluating comparative advertising, AMS considers the following, as part of its overall

review:

• How and where will it be used? How will it be distributed? What is the takeaway?

• Are the commodities being compared interchangeable?

• Are the comparisons truthful, not misleading, and limited to fact-based information

or data?

• Do any statements or images in the advertisement disparage another commodity or

product, including, but not limited to, the areas of quality, use, value or sale?

• Does the advertising make any false or unsubstantiated claims against another

commodity or product?

• Are appropriate disclosures noted?

Marketing Communication Guidelines – March 2018 Page 61 of 119

AMS policy prohibits false, misleading, or deceptive information and disparagement in

advertising. FTC and AMS permit comparative advertising that aids consumers in making

purchase decisions. Such comparative advertising may compare the desirable qualities of a

product compared to qualities of competing products. Comparative advertising (comparing facts

about different commodities or products) is allowed as long as the information is factual. For

food advertising, comparisons are allowed for “foods or products that are interchangeable in the

diet, etc...” These product comparisons should be made clearly referencing the serving size or

the RACC for each product.

Examples of comparative and disparaging statements:

• Comparative: “product X contains ____ g protein; product Y contains ____ g protein.”

 This is a factual statement, and the information is verifiable. Any nutritional

comparison must be in close proximity to any claims or disclosures.

(Page 4 of this document.)

• Comparative: “product X costs _$$; product y costs _$$”

 This is a factual statement, and the information is verifiable.

• Disparaging: “X tastes better than Y.”

 The word “better” is subjective, and the claim provides no factual information or

data.

• Disparaging: “Get into this Century and buy X instead of Y!”

 The claim provides no factual information or data.

Appeal Process for Comparative Advertisements:

All comparative advertisements submitted for review featuring two or more commodities

represented by an AMS commodity promotion program will be reviewed by each applicable

AMS Program Area. If the Program Areas are unable to reach agreement on

approval/disapproval, an appeal for resolution will be submitted to the AMS Research and

Promotion Functional Committee. The AMS Administrator will issue a final resolution if

necessary.

V. Attribution

Marketing Communication Guidelines – March 2018 Page 62 of 119

Board advertising and other communications must carry an attribution identifying the Board or

assessment payers as the advertiser. It could be the Board name, logo, or wording like

“America’s (commodity) farmers” or similar language.

VI. Government Speech

Board speech is government speech. Therefore, Board speech should be consistent with USDA

policies in all areas.

All statements and depictions must be appropriate for all audiences and be appropriate for the

Secretary of Agriculture and all other USDA employees to make. (Audience-appropriateness in

this case does not refer to understanding. A piece targeting health practitioners, for example,

would not need to be easily understood by the larger public.)

If Board materials refer to a specific office holder or individual, AMS will verify the materials

are consistent with that individual’s positions and will verify approval for that usage.

For example, Board guidance related to foodborne illness outbreaks should agree with the

guidance issued by USDA and other Federal agencies and may not contradict any guidance

provided by USDA and other government agencies. Another example would be a Board wanting

to quote the Secretary of Agriculture. In that case, AMS should ensure that the quote is

consistent with the Secretary’s guidance and verify it is used appropriately. Yet another example

would be a Board quoting a person such as the First Lady or using her image; AMS will first

verify approval for that usage. Please note obtaining the approval for scenarios such as the

above may require additional review time.

Linkages to Other Websites: Boards cannot point readers to a specific blog or post not consistent

with government speech because those linkages imply endorsement. Examples would be a

farmer’s or individual’s blog post that comments on pending legislation or a Website that gives

opinions about policy (even if both sides are presented). Linkages to Websites or blogs should

be addressed in each Board’s social media policy and all linkages will be reviewed on a case-by-

case basis by each Board’s marketing specialist.

A. Influencing Government

Boards must limit their actions to those that are authorized by their respective legislation.

Boards may not take positions on political issues or endorse candidates for office, and all

communications must remain non-political. Boards are prohibited from engaging in any attempts

to influence a decision or course of action of any governmental body (i.e., local, State, or

Federal). Similarly, Boards cannot support or oppose government actions, or recommend

government action. For example, if Boards write comments in response to regulatory actions,

they can state only factual evidence and cannot recommend a position (and AMS must first

approve the comments prior to submission).

Marketing Communication Guidelines – March 2018 Page 63 of 119

Boards cannot provide comments on government guidance that request or recommend change.

For example, Boards cannot imply that U.S. dietary guidance is outdated or should be changed.

Boards are permitted to submit comments, with prior AMS approval, that provide information,

including research, as consideration for comments. Boards can fund research to determine a

factual outcome, such as what effect results from the intake of a certain amount of a nutrient or

food. Boards can share research results; however, Boards cannot recommend that the

government take a course of action as a result of that research.

B. Image or Office of the President

Consistent with White House policy, the image or office of the President of the United States

may not be used at any time unless approval is specifically granted. This applies to the current

President and all past Presidents of the United States.

C. Trademarks

Boards cannot unlawfully use others’ trademarks, copyrights, or logos.

D. Transparency and Links to Websites

For all Board Websites, AMS requires Boards to place transition screens or other statements at

all linkages to outside Websites. Specifically, the screen should indicate the viewer is leaving a

Board site. Boards should not use blockable pop-up transition screens.

Boards should include the language: “You are now leaving (insert Board name) site and the

Board is not responsible for the information or views expressed”, or other similar language

approved by AMS. This includes linkages to private companies, other industry organizations, or

any other non-Board sites. In lieu of a transition screen, AMS will allow statements that indicate

clicking a link will cause a person to leave a Board site.

If a Board reposts AMS-approved media from a Board funded Website to a social media site, i.e.

Facebook, YouTube, etc…the Board must acknowledge sponsorship of the media. AMS

understands if a media item is reposted by an outside individual or group without the Board’s

approval, this would be outside of the Board’s ability or jurisdiction to manage.

More detailed information on Social Media Content is contained in Appendix D.

E. Branded Advertising

AMS will follow each Board’s statutory framework when evaluating branded advertising.

Marketing Communication Guidelines – March 2018 Page 64 of 119

VII. Guidance on Word Usage

There are a number of health and nutrition-related, or other terms that have been defined by the

FDA or FTC; AMS has also issued its own guidance on certain terms. For terms that are not

formally defined, AMS will generally default to allowing Boards to use the term, as long as there

isn’t a clear or obvious reason for not doing so. This will allow Boards to more freely use

marketing terms that are not regulated, but are still reasonable, and not easily or readily

misconstrued from a consumer perspective.

See Appendix B for a partial listing of consumer-friendly, unregulated terms and FDA Defined

Terms.

Guideline Updates

AMS will review and update these Marketing Communications Guidelines as needed.

AMS Review Process

AMS will review all marketing communications. Each program has a designated marketing

representative serving as the primary reviewer of all marketing communications. In addition,

most programs have a designated back-up representative who assists with reviews, as needed, to

ensure the timely review of all marketing communications.

Review of extensive research communications will require more time so marketing specialists,

AMS nutritionists or other USDA experts, can review applicable research studies. Upon receipt

of such communications, marketing specialists will advise Board staff when an extensive review

is required. Boards must provide referenced research studies when they submit the

communication for review.

When necessary, AMS will coordinate reviews across programs involving commodities under

AMS oversight and other applicable Agencies, to ensure consistency in approvals. Marketing

specialists will advise Board staff when a more extensive review is needed.

Marketing Communication Guidelines – March 2018 Page 65 of 119

Acronyms:

• AMS Agricultural Marketing Service

• FDA Food and Drug Administration

• FTC Federal Trade Commission

• MOAD Marketing Order and Agreement Division

• POS/POP Point of Sale/ Point of Purchase

• RACC Reference Amounts Customarily Consumed

• USDA United States Department of Agriculture

List of Research and Promotion Boards

• Dairy Promotion and Research Board

• Fluid Milk Processor Promotion Board

• Cattlemen’s Beef Board

• National Pork Board

• American Egg Board

• American Lamb Board

• United Soybean Board

• United Sorghum Checkoff Program

• Cotton Board

• National Watermelon Promotion Board

• Softwood Lumber Board

• National Mango Board

• National Potato Promotion Board

• Christmas Tree Promotion Board

• Mushroom Council

• National Peanut Board

• Paper and Packaging Board

• Popcorn Board

• Hass Avocado Board

• National Honey Board

• U.S. Highbush Blueberry Council

List of Marketing Order Boards and Committees

• Almond Board of California

• American Pecan Council

• California Date Administrative Committee

• California Desert Grape Administrative Committee

Marketing Communication Guidelines – March 2018 Page 66 of 119

• California Olive Committee

• California Walnut Board

• Cherry Industry Administrative Board

• Colorado Potato Administrative Committee

• Cranberry Marketing Committee

• Far West Spearmint Oil Administrative Committee

• Florida Avocado Administrative Committee

• Florida Citrus Administrative Committee

• Florida Tomato Committee

• Fresh Pear Committee

• Hazelnut Marketing Board

• Idaho-Eastern Oregon Potato Committee

• Prune Marketing Committee

• Raisin Administrative Committee

• South Texas Onion Committee

• Texas Valley Citrus Committee

• Vidalia Onion Committee

• Walla Walla Sweet Onion Marketing Committee

• Washington Apricot Marketing Committee

• Washington Cherry Marketing Committee

Marketing Communication Guidelines – March 2018 Page 67 of 119

List of Appendices

Appendix A: References Used by AMS

Appendix B: FDA Defined Terms and Marketing Terms & Additional Guidance for Health

Claim Messaging

Appendix C: Research Communication Guidance

Appendix D: Social Media Content

Appendix E: Food Safety

Appendix F: Environment Claims

Marketing Communication Guidelines – March 2018 Page 68 of 119

APPENDIX A - References Used by AMS

• FDA 21 CFR 101 Food Labeling

http://www.accessdata.fda.gov/scripts/cdrh/cfdocs/cfcfr/CFRSearch.cfm?cfrpart=101

• FDA 21 CFR 101: Subpart D--Specific Requirements for Nutrient Content Claims:

http://www.accessdata.fda.gov/scripts/cdrh/cfdocs/cfcfr/CFRSearch.cfm?CFRPart=101&showFR

=1&subpartNode=21:2.0.1.1.2.4

• FDA Label Claims: General Information

(Including Health Claims; Qualified Claims; and Nutrient Content Claims)

http://www.fda.gov/food/ingredientspackaginglabeling/labelingnutrition/ucm2006873.htm

• FDA Food Labeling Guide 2013

http://www.fda.gov/Food/GuidanceRegulation/GuidanceDocumentsRegulatoryInformation/Label

ingNutrition/ucm2006828.htm

• FDA Changes to the Nutrition Facts Label

https://www.fda.gov/food/guidanceregulation/guidancedocumentsregulatoryinformation/labeling

nutrition/ucm385663.htm

• FTC Enforcement Policy Statement on Food Advertising - May 1994

http://www.ftc.gov/enforcement-policy-statement-on-food-advertising

• FTC Advertising and Marketing; including the following:

o Online Advertising and Marketing;

o .com Disclosures: How to Make Effective Disclosures in Digital Advertising;

o Advertising and Marketing on the Internet: Rules of the Road

o The FTC Revised Endorsement Guide: What People Are Asking

o Advertising FAQs: A Guide for Small Business

http://www.business.ftc.gov/advertising-and-marketing

• USDA Nutrient Database for Standard Reference

http://ndb.nal.usda.gov/

• Dietary Reference Intakes and Recommended Dietary Allowances:

http://fnic.nal.usda.gov/dietary-guidance/dietary-reference-intakes

• Generic Copy Test of Food Health Claims in Advertising, November 1998, FTC

Marketing Communication Guidelines – March 2018 Page 69 of 119

http://www.ftc.gov/reports/generic-copy-test-food-health-claims-advertising

• Dietary Guidelines for Americans 2015

http://www.cnpp.usda.gov/dietaryguidelines.htm

Appendix B: FDA Defined Terms and Marketing Terms & Additional Guidance for

Health Claim Messaging

This appendix includes a listing of terms that FDA has defined and AMS guidance on additional

terms, followed by words and phrases that are marketing-related but currently undefined from a

regulatory perspective.

** The fact that the word or phrase is listed here does NOT mean that it is automatically

approved for use. Each marketing term and phrase will be individually evaluated based on

the context in which it is used.

Please note, if there is any discrepancy between what is here vs. what appears in the FDA

regulations, FDA regulations control.

Term

Definition

Free

This means that a product contains no amount of, or only trivial or

“physiologically inconsequential” amounts of, one or more of these

components: fat, saturated fat, cholesterol, sodium, sugars, and calories.

For example, “calorie-free” means fewer than 5 calories per RACC, and

“sugar-free” and “fat-free” mean less than 0.5 g per RACC. Synonyms for

“free” include “without,” “no,” and “zero.” A synonym for fat-free milk is

“skim.”

Low

This can be used on foods that can be eaten frequently without exceeding

dietary guidelines for one or more of these components: fat, saturated fat,

cholesterol, sodium, and calories. Synonyms are little, few, low source of,

contains a small amount of, or alternative spellings like “lo.” Descriptors

are defined as follows:

Low-fat: 3 g or less per RACC

Low-saturated fat: 1 g or less per RACC

Low-sodium: 140 mg or less per RACC

Very low sodium: 35 mg or less per RACC

Low-cholesterol: 20 mg or less and 2 g or less of saturated fat per RACC

Low-calorie: 40 calories or less per RACC

Marketing Communication Guidelines – March 2018 Page 70 of 119

Term

Definition

Lean and extra

lean

These terms can describe the fat content of meat, poultry, seafood, and game

meats.

Lean: less than 10 g fat, 4.5 g or less saturated fat, and less than 95 mg

cholesterol per RACC and per 100 g

Extra lean: less than 5 g fat, less than 2 g saturated fat, and less than 95

mg cholesterol per RACC and per 100 g

Excellent source

This term means that a food contains 20% or more of the Daily Value for a

particular nutrient per the RACC. Synonyms: high, rich in, packed with, or

alternative spellings like “hi.”

Good source

This term means that a food contains 10-19% of the Daily Value for a

particular nutrient per RACC. Synonyms: contains, provides.

Reduced

This term means that a nutritionally altered product contains at least 25%

less of a nutrient or of calories than the regular, or reference, product.

However, a reduced claim cannot be made on a product if its reference food

already meets the requirement for a “low” claim.

Less

This term means that a food, whether altered or not, contains 25% less of a

nutrient or of calories than the reference food. For example, pretzels that

have 25% less fat than another type of snack could carry a “less” claim with

reference to that snack. Synonym: fewer.

Light

This descriptor can mean two things:

• First, that a nutritionally altered product contains one-third fewer

calories or one half the fat of the reference food. If the food derives

50% or more of its calories from fat, the reduction must be 50% of

the fat.

• Second, the sodium content of a low-calorie, low-fat food has been

reduced by 50%. In addition, “light in sodium” may be used on food

in which the sodium content has been reduced by at least 50%.

The term “light” still can used to describe such properties as texture and

color, as long as the label explains the intent—for example, “light brown

sugar” and “light and fluffy.”

More

This term means that a food, whether altered or not, contains at least 10%

more of the Daily Value per RACC than an appropriate reference food. The

claim may only be used for vitamins, minerals, protein, dietary fiber, and

potassium.

Marketing Communication Guidelines – March 2018 Page 71 of 119

Term

Definition

This definition also applies to the use of “fortified,” “enriched,” “added,”

“extra,” and “plus” claims, but in those cases, the food must be altered.

Fresh

FDA defines “fresh” because of concern over the term’s possible misuse on

some food labels.

• When “fresh” is used to suggest that a food is raw or unprocessed, it

can be used only on a food that is raw, has never been frozen or

heated, and contains no preservatives. Irradiation at low levels is

allowed.

• “Fresh frozen,” “frozen fresh,” and “freshly frozen” can be used for

foods that are quickly frozen while still fresh. Blanching (brief

scalding before freezing) is allowed.

Other uses of the term “fresh,” such as in fresh milk or freshly baked bread

are not affected.

Healthy

The nutrient criteria to use the “healthy” claim can vary for different food

categories (e.g., fruits and vegetables, or seafood and game meat) (see 21

CFR 101.65(d)(2)). These criteria are linked to elements in the Nutrition

Facts label and serving size regulations (see 21 CFR §§ 101.9 and 101.12).

To be described as “healthy,” a food must meet the following criteria per

RACC*, or for meal products, per labeled serving (*21 CFR §101.65):

If the food is…

The fat level

must be…

The

saturated

fat level

must be…

The cholesterol

level must be…

The food must

contain…

A raw fruit or

vegetable

If not low fat as

defined in

§101.62(b)(2),

must be

predominantly

poly and

monounsaturated

fat

Low saturated

fat as defined

in

101.62(c)(2)

[generally 1 g

or less

saturated fat]

The disclosure

level for

cholesterol

specified in

101.13(h) or less

[60 mg]

N/A

A single-

ingredient or a

mixture of frozen

or canned fruits

and vegetables

If not low fat as

defined in

§101.62(b)(2),

must be

predominantly

poly and

monounsaturated

fat

Low saturated

fat as defined

in

101.62(c)(2)

The disclosure

level for

cholesterol

specified in

101.13(h) or less

N/A

Marketing Communication Guidelines – March 2018 Page 72 of 119

Term

Definition

An enriched

cereal-grain

product that

conforms to a

standard of

identity in part

136, 137 or 139 of

this chapter

If not low fat as

defined in

§101.62(b)(2),

must be

predominantly

poly and

monounsaturated

fat

Low saturated

fat as defined

in

101.62(c)(2)

[generally 1 g

or less

saturated fat]

The disclosure

level for

cholesterol

specified in

101.13(h) or less

N/A

A raw, single-

ingredient seafood

or game meat

Less than 5 g total

fat per serving and

per 100 g

Less than 2 g

saturated fat

per serving

and per 100 g

Less than 95 mg

cholesterol per

serving and per

100 g

At least 10% of the

RDI or the DRV

per RA of one or

more of vitamin A,

vitamin C, calcium,

iron, protein, or

fiber

A meal product as

defined in

101.13(1) or a

main dish product

as defined in

101.13(m)

If not low fat as

defined in

§101.62(b)(2),

must be

predominantly

poly and

monounsaturated

fat

Low saturated

fat as defined

in

101.62(c)(2)

[generally 1 g

or less

saturated fat]

90 mg or less

cholesterol per

serving

At least 10% of the

RDI or DRV per

serving of 2

nutrients (for a

main dish product)

or of 3 nutrients

(for a meal

product) of:

vitamin A, vitamin

D, calcium, iron,

protein, or fiber

A food not

specifically listed

in this table

If not low fat as

defined in

§101.62(b)(2),

must be

predominantly

poly and

monounsaturated

fat

Low saturated

fat as defined

in

101.62(c)(2)

[generally 1 g

or less

saturated fat]

The disclosure

level for

cholesterol

specified in

§101.13(h) or less

At least 10 percent

of the RDI or the

DRV per RA of

one or more of

vitamin A, vitamin

C, vitamin D,

potassium,

calcium, iron,

protein or fiber

*For foods with RACC equal to or less than 30 g or 2 tablespoons, use 50 g to determine if criteria is

met for total fat, cholesterol, and sodium.

If the food is… The sodium level must be…

A food with a serving size greater than 30 g or 2

tablespoons

480 mg or less sodium per serving

A food with a serving size equal to or less than

30 g or 2 tablespoons

480 mg or less sodium per 50 g

A meal product as defined in 101.13(1) or a main

dish product as defined in 101.13(m)

600 mg or less sodium per serving

Unregulated Terms

The following marketing terms have not been defined from a regulatory perspective. This is

NOT an exhaustive or all-inclusive list, and these terms may not apply to all commodities.

Certain terms and phrases are clarified below under the heading “AMS Guidance for Specific

Marketing Communication Guidelines – March 2018 Page 73 of 119

Terms.”

o A must for any diet

o Alternative

o As wholesome as it gets

o Crispy

o Crunchy

o Delicious

o Delightful

o Good stuff

o Good-for-you

o Goodness

o Goodness of

o Health benefits

o Healthy naturals

o Heart-warming

o High-quality plant protein

o Low Carb

o More flavor for everyone

o Nourishing

o Real

o Robust

o Satisfying

o Sensational

o Sizzling

o Sumptuous

o Super food

o Super fruit

o Tasty

o Ultimate

o Wholesome

Marketing Communication Guidelines – March 2018 Page 74 of 119

AMS Guidance for Specific Terms

• Bad fat (may be used to indicate saturated and trans fats)

• Good fat (may be used for unsaturated fats (monounsaturated and polyunsaturated)

• Packed with (similar language to excellent source of stated nutrient)

• Bursting with (implies excellent source of stated nutrient)

• Chock full of (implies excellent source of stated nutrient)

• Packed with plenty of nutrients (product should be an excellent source of two or more

nutrients)

• Deliciously packed with nutrients (product should be an excellent source of two or

more nutrients)

• Power-packed (The context in which phrase is used will be considered: For example,

the term “power-packed” in the phrase “power-packed protein” describes the nutrient and

does not imply that the food is an excellent source of protein. As another example, the

phrase “product x has y grams of power-packed protein” is also approvable. Although

the total amount of protein is stated, there is no implication that the food is an excellent

source of protein.)

• Premier source of (similar language for excellent source of stated nutrient)

• Natural; All-natural; Natural goodness; Naturally good for you. FDA General

Guidance: Product does not contain added color, artificial flavors, or synthetic

substances. This term is not defined by FDA.

• Nutrient-Dense; Nutritionally-dense. Nutrient-Dense Foods – The Dietary Guidelines

defines it as: Those foods and beverages that provide vitamins, minerals, and other

substances that may have positive health effects, with relatively few calories. Nutrient-

dense foods and beverages are lean or low in solid fats, and minimize or exclude added

solid fats, sugars, starches, and sodium. Ideally, they also are in forms that retain

naturally occurring components, such as dietary fiber. All vegetables, fruits, whole

grains, seafood, eggs, beans and peas, unsalted nuts and seeds, fat-free and low-fat milk

and milk products, and lean meats and poultry—when prepared without solid fats or

added sugars—are nutrient-dense foods. The term and similar terms should be used as

defined.

• Antioxidants – vitamin E, vitamin C and selenium. These antioxidants have established

daily values so nutrient content claims for good and/or excellent source are allowed. For

antioxidants and or nutrients for which there is no established DV, the amount of the

nutrient per serving must be referenced when making a nutrient content claim.

• Nutritious. There are no FDA guidelines for it but the statement must be truthful and not

misleading.

Marketing Communication Guidelines – March 2018 Page 75 of 119

USDA AMS follows FDA and FTC policy/guidance regarding authorized health claims and

qualified health claims used in marketing and nutrition related materials. FDA regulations define

health claims in 21 CFR 101.14 (a)(1) and p.

1. Authorized Health Claims

FDA regulations govern all health claims on food labels and in labeling of foods. Health claim

messages that are included in point of sale communications or materials that could potentially be

used as digital point of sale information must include the complete FDA approved health claim

statement(s). This health claim statement advises consumers about the context and other dietary

recommendations in which the health claim is made. FDA provides examples of model health

claim statements for each approved health claim. Similar statements made be made as long as the

requirements for that health claim are included. See 21 CFR 101.72 through .82 for approved

health claims.

Example: Point of Sale material with Dietary Saturated Fat and Cholesterol and Risk of

Coronary Heart Disease (CHD) Health Claim

Messaging: Avocados are heart-healthy

Accompanying statement required, found at 21 CFR 101.75: “While many factors

affect heart disease, diets low in saturated fat and cholesterol may reduce the risk of this

disease.”

For other advertising and communication materials, FTC allows more flexibility regarding

the use of health claims as long as the claims are truthful and not misleading. Because approved

health claims are supported by significant scientific agreement (SSA), FTC permits health claims

messaging without an accompanying statement when the materials showcase the food by itself

and are not used as point of sale influencers. FTC acknowledges that while the educational

aspect of the approved health claim statement is important, it may not be feasible to include this

additional information in all materials.

Example: Print/Digital Ad with CHD Health Claim:

Messaging: Avocados are heart-healthy

No accompanying statement is required.*

Example: Digital Ad with Health Claim regarding Fruits and Vegetables and Risk of Cancer:

Marketing Communication Guidelines – March 2018 Page 76 of 119

Messaging: Eating more fruits and veggies, including broccoli, may reduce the risk of some

cancers.

No accompanying statement is required*. Note: Broccoli meets FDA’s criteria for this

health claim based on vitamins A, C, and fiber content.

* Encourage boards to provide background at other webpages/materials regarding healthy

eating patterns to provide relevant context.

2. Qualified Health Claims

FDA qualified health claims, which are based on limited scientific evidence, must be

accompanied by the FDA model statement or qualifying language about the level of scientific

evidence supporting the claim and dietary restrictions (when applicable). For all point of sale

information, the full statement must be included to help the consumer understand the context for

building a healthful diet.

While FTC allows some flexibility for advertising and communication materials, when the

qualified health claim statement includes additional information regarding saturated fat and

calorie consumption, as found in the qualified health claim statements for macadamia nuts and

walnuts, the full statement must be used.

Qualified health claims are based on the totality of publicly available evidence, but the scientific

evidence is limited and does not reach the level of SSA. Therefore, qualified health claims must

include appropriate qualifying language to help consumers understand the different levels of

supporting science.

For advertising and communication materials, FTC requires a statement to help consumers

understand the level of scientific agreement, but does not require general guidance for diets low

in saturated fat and cholesterol.

Example: Qualified Health Claim for Risk of CHD with specific dietary guidance (for Point

of Sale and marketing communications):

Messaging: Macadamia nuts are heart healthy

Required Qualified Health Claim Statement: “Supportive but not conclusive research

shows that eating 1.5 ounces per day of macadamia nuts, as part of a diet low in saturated

fat and cholesterol and not resulting in increased intake of saturated fat or calories may

reduce the risk of coronary heart disease.

A one ounce serving of macadamia nuts contains 17g unsaturated fat, 3 g saturated fat

and 200 calories.”

Example: Point of Sale with Qualified Health Claim for CHD:

Marketing Communication Guidelines – March 2018 Page 77 of 119

Messaging: Peanuts are heart healthy

Required Qualified Health Claim Statement: “Supportive but not conclusive research

shows that eating 1.5 ounces per day of most nuts, including peanuts, as part of a diet low

in saturated fat and cholesterol, may reduce the risk of coronary heart disease.

See nutrition information for fat content.”

Example: Website Ad with Qualified Health Claim for CHD:

Messaging: Peanuts are heart healthy

Required Qualified Health Claim Statement: “Supportive but not conclusive research

shows that eating 1.5 ounces per day of most nuts, including peanuts, may reduce the risk

of coronary heart disease.

A one ounce serving contains 15 grams of fat.”

AMS will continue to review and approve marketing materials on a case by case basis to ensure

boards include health claim statements when appropriate.

Marketing Communication Guidelines – March 2018 Page 78 of 119

Marketing Communications

Additional Guidance for Using Health Claims

Yes

No

Yes

No

No

*

Encourage boards to provide background at other webpages/materials

regarding healthy eating patterns to provide relevant context.

APPENDIX C: Research Communication Guidance

This appendix clarifies the criteria used by AMS to review and approve research

communications. This guidance relates to the communication of research findings, including

Is the material considered

Point of Sale (either print or

electronic?)

Messaging must include

complete FDA health claim

language, including

appropriate model

statement(s)

Messaging must include

FDA qualified health claim

language for scientific

agreement and any specific

dietary info.

Is the messaging

referencing a qualified

health claim?

Messaging does not require

FDA approved health

claim statement*

Marketing Communication Guidelines – March 2018 Page 79 of 119

audience/market research, human clinical trials, observational studies, animal in vitro studies,

and preliminary research study findings. The guidance applies to marketing communications

including, but not limited to, press releases, articles, Website content, and blogs that are

generally intended for a broad array of audiences, including health professionals, industry, food

service, trade, consumers, and media. Communications of other types of research, such as

production, environmental or other scientific studies typically intended for an agricultural

audience are not subject to this guidance.

All Board communications pertaining to research findings are limited to peer-reviewed

published research. Communications should include a statement attributing the Board

with funding the research, when applicable.

Human Clinical Trials/Intervention Studies:

• Communication should be factual and consistent with findings/outcomes and conclusions

of the study.

• Communication should not overstate the findings and/or the body of scientific evidence.

This includes the titles, headings, and sub-headings.

• The communication should not draw conclusions from the study outcomes if it is

emerging research or if there is no consensus of findings based on earlier research.

Statements should be limited to the findings of the study. For example: “The study found

that participants experienced …….”

• The communication should include a statement that the findings are not conclusive and/or

contradict earlier research, when applicable.

• The findings of studies on selected populations should not be generalized to different

populations.

• Quotes from researchers must be consistent with the scientific evidence and reflect the

findings of the study. Quotes should not overstate the results or imply findings apply to

the general population based on a limited study.

• Include appropriate qualifiers in the communication. Such qualifiers should reflect

inconsistencies found earlier research, if applicable.

• Provide PubMed link or other available link for the audience to obtain study. Provide

reference information for study and other studies noted in release

• Communication reporting structure/function claims may not imply a drug effect or health

claim. Structure/function claims may be appropriate if they reference normal

structure/function. (For example; “The findings from this study suggest that substance x

may help maintain normal cholesterol levels.” Using terms such as "restore," "raise,"

"lower," "promote," "regulate," or "stimulate" might create an implied disease claim if, in

the context they are used, they imply an effect on disease. Similarly, words like

"prevent," "mitigate," "diagnose," "cure," “reverse,” or "treat" would be disease claims if

the context of their use implied an effect on a disease. (See General Guidance pg. 10.)

Marketing Communication Guidelines – March 2018 Page 80 of 119

Observational Studies: (includes cohort, cross sectional, ecological and case reports)

• Communication should acknowledge that observational studies cannot establish cause

and effect between an intervention and an outcome. Observational studies can provide

useful information for identifying possible associations to be tested by

intervention/clinical trial studies.

• Include appropriate disclaimers, especially for ecological studies which compare disease

incidence across different populations, and case reports which describe observations of a

single subject or a small number of subjects.

Disclaimers and Qualifiers for Human Research

• Disclose study limitations and other factors that affect study results. Common study

limitations include, but are not limited to:

o Unique characteristics of study participants. For example, study participants with

certain medical conditions (hypercholesterolemia, diabetes, or obesity.)

o Short study period. For example, a 2-week study-period.

o Non-US populations with different dietary patterns.

o Small study group. For example, study with fewer than 20 participants.

o Study population does not reflect the broad US population. For example, study

with only adult male participants.

• Study methodology. For example, study participants self-reported compliance with diet

or outcomes. Include appropriate study qualifiers. Examples of qualifying statements

are:

o “Additional research is needed to examine the effects of “product X”

consumption on oxidative stress in non-smokers.”

o “While these results indicate a positive benefit, other earlier studies show mixed

results.”

o “Because the study participants were at high cardiovascular risk, it is not known

whether the results can be generalized to persons at lower risk or to other settings.

Further research is needed.”

o “Whether adding “product X” to the diet will achieve the results shown in this

study or in the general population is not yet known.”

o “The results suggest that there may be an association between X and Y. However,

no cause and effect can be determined.”

Animal, In Vitro, and Preliminary Research Findings:

Animal and in vitro research provides important insights into the potential role that compounds in

foods contribute to structure/function. However this research is not sufficient, without confirmation

in human research, to support a health benefit claim. Communicating outcomes from this research

may not imply an efficacy claim that has not yet been adequately substantiated.

• Communication should be consistent with the standards for human clinical studies.

Marketing Communication Guidelines – March 2018 Page 81 of 119

• Communication should note the type of study (animal or in vitro).

• Communication should not imply similar results in human physiology or behavior based

on this research.

• For animal and in vitro studies, it should be noted that the results are indicators that are

used as background and to formulate hypotheses for other studies.

• For preliminary research findings, indicate that the results are part of a multi-year effort

and final outcomes could show different results.

Disclaimers and Qualifiers for Animal or In Vitro Research

• Disclose relevant information about the study: The information should be placed as near

as possible to the discussion of the finding(s) and should be prominently placed in the

communication. Disclaimers at the bottom of a communication piece or as footnotes are

not considered prominently placed. This placement could vary depending on the type of

communication. For example:

o One-page Information Sheet of several studies of various chronic diseases: It may

be appropriate to place disclaimers and qualifying statements at the top of the

communication.

o Press Releases: Prominent placement in the body of the communication as near

as possible to the discussion of the study finding(s) is appropriate.

• The communication must clearly indicate that the animal study findings are:

o A basis for formulating a hypothesis for conducting additional studies,

particularly human clinical studies; and

o Not conclusive as to the effects on humans.

Examples:

• “While the results of the study show promising outcomes, these are inconclusive,

and should be used as background for forming hypotheses and conducting

additional research, including human clinical trials, which are needed to fully

understand the effect on humans.”

• “The study provides a hypothesis to investigate through human clinical studies in

order to determine what the effect would be on humans.”

Abstracts, Review Articles and Editorials:

Communication may not cite abstracts, review articles or editorials as the sole justification for

outcomes/findings. Critical elements such as the study population characteristics and the

composition of the products used may differ widely across individual studies and must be

acknowledged in the communication. Meta-Analyses will be evaluated on a case-by-case basis.

Market Research:

Marketing Communication Guidelines – March 2018 Page 82 of 119

Audience research may be conducted to understand target audience attitudes and to measure

results of marketing programs. Market research questionnaires and reports are not subject to

AMS review. However, when market research is repurposed for use in communication/messages

to external target audiences, those messages are subject to AMS review and approval for

consistency with AMS, FTC, and FDA policy. Example: If market research references the term

“healthy,” AMS would review communication in context with FDA’s “healthy” definition.

Definitions:

Authoritative Sources/Statements

FDAMA permits claims based on current, published authoritative statements from "a scientific

body of the United States with official responsibility for public health protection or research

directly related to human nutrition . . . or the National Academy of Sciences (NAS) or any of its

subdivisions." The National Institutes of Health (NIH) and the Centers for Disease Control and

Prevention (CDC) are federal government agencies specifically identified as scientific bodies by

FDAMA.

FDA believes that other federal agencies may also qualify as appropriate sources for such

authoritative statements. Along with NAS (or any of its subdivisions), the agency currently

considers that the following federal scientific bodies may be sources of authoritative statements:

the CDC, the NIH, and the Surgeon General within Department of Health and Human Services;

and the Food and Nutrition Service, the Food Safety and Inspection Service, and the Agricultural

Research Service within the Department of Agriculture.

Emerging research/science is science or research published in peer-reviewed journal(s), for

which there is some, but limited scientific evidence that supports the possible link between

consumption of a product in reasonable proportion and a health benefit. Not every new study is

considered emerging research.

According to the FDA Food Advisory Committee and Emerging Science Work Group,

“Emerging Science” is: “one or more research findings pertaining to a food substance's

consumption by humans that are judged, by a panel of appropriately qualified experts, to

indicate, after consideration of all valid reports pertaining to the substance, that the general

population, or some specific segment of the population, will possibly achieve a significant health

benefit(s) without significant adverse effects when the substance is consumed in a reasonable

amount over a reasonable period.” However, there is insufficient evidence to reach a level of

significant scientific agreement.

Significant scientific agreement (SSA) refers to the extent of agreement among qualified

experts in the field. On the continuum of scientific evidence that extends from very limited to

inconclusive evidence, SSA lies closer to consensus. FDA's determination of SSA represents the

agency's best judgment as to whether qualified experts would likely agree that the scientific

Marketing Communication Guidelines – March 2018 Page 83 of 119

evidence supports the substance/disease relationship that is the subject of a proposed health

claim. The SSA standard is intended to be a strong standard that provides a high level of

confidence in the validity of the substance/disease relationship. SSA means that the validity of

the relationship is not likely to be reversed by new and evolving science, although the exact

nature of the relationship may need to be refined. SSA occurs well after the stage of emerging

science, where data and information permit an inference, but before the point of unanimous

agreement within the relevant scientific community that the inference is valid.

In determining whether there is significant scientific agreement, FDA takes into account the

viewpoints of qualified experts outside the agency, if evaluations by such experts have been

conducted and are publicly available. For example, FDA considers:

• documentation of the opinion of an "expert panel" that is specifically convened for this

purpose by a credible, independent body;

• the opinion or recommendation of a federal government scientific body such as the

National Institutes of Health (NIH) or the Centers for Disease Control and Prevention

(CDC); or the National Academy of Sciences (NAS);

• the opinion of an independent, expert body such as the Committee on Nutrition of the

American Academy of Pediatrics (AAP), the American Heart Association (AHA),

American Cancer Society (ACS), or task forces or other groups assembled by the

National Institutes of Health (NIH); and,

• publications that critically summarize data and information in the secondary scientific

literature.

FDA accords the greatest weight to the conclusions of federal government scientific bodies,

especially when the evidence for the validity of a substance/disease relationship has been judged

by such a body to be sufficient to justify dietary recommendations to the public. When the

validity of a substance/disease relationship is supported by the conclusions of federal

government scientific bodies, FDA typically finds that significant scientific agreement exists.

Application of the significant scientific agreement standard is intended to be objective, in relying

upon a body of sound and relevant scientific data; flexible, in recognizing the variability in the

amount and type of data needed to support the validity of different substance/disease

relationships; and responsive, in recognizing the need to re-evaluate data over time as research

questions and experimental approaches are refined.

Use of Antioxidant Data and Polyphenol Research: USDA ARS has concluded there is no

evidence that the beneficial effects of polyphenol-rich foods can be attributed to the antioxidant

properties of these foods. The data for antioxidant capacity of foods generated by in vitro (test-

tube) methods cannot be extrapolated to in vivo (human) effects and the clinical trials to test

benefits of dietary antioxidants have produced mixed results.

https://www.ars.usda.gov/northeast-area/beltsville-md/beltsville-human-nutrition-research-

center/nutrient-data-laboratory/docs/oxygen-radical-absorbance-capacity-orac-of-selected-foods-

release-2-2010/.

Marketing Communication Guidelines – March 2018 Page 84 of 119

Credible research for a qualified health claim is when there is scientific evidence that supports

the health claim but such evidence does not meet the SSA standard. Health claims based on such

research should include qualifying language that reflects the level of scientific support with

specificity and accuracy.

Preliminary research findings, as defined by an AMS/industry work group, are strong

indicators of the results of a multi-year study that is not yet complete. The research is generally

conducted in phases and published in a peer-reviewed journal. The initial findings should be

communicated using the standards for animal or in-vitro research, since the findings are

considered a hypothesis and are not final.

RESOURCES:

FDA

Guidance for Industry Evidence-Based Review System for the Scientific Evaluation of Health

Claims

http://www.fda.gov/food/guidanceregulation/guidancedocumentsregulatoryinformation/ucm0733

32.htm

https://www.fda.gov/Food/GuidanceRegulation/GuidanceDocumentsRegulatoryInformation/Diet

arySupplements/ucm073200.htm

Guidance for Industry: A Food Labeling Guide

http://www.fda.gov/Food/GuidanceRegulation/GuidanceDocumentsRegulatoryInformation/Labe

lingNutrition/ucm064908.htm

Guidance for Industry: Use of the Term “Healthy” in the Labeling of Human Food Products

https://www.fda.gov/Food/GuidanceRegulation/GuidanceDocumentsRegulatoryInformation/ucm

521690.htm

Structure /Function Claims

http://www.fda.gov/Food/IngredientsPackagingLabeling/LabelingNutrition/ucm2006881.htm

Guidance for Industry: Notification of a Health Claim or Nutrient Content Claim Based on an

Authoritative Statement of a Scientific Body

http://www.fda.gov/Food/GuidanceRegulation/GuidanceDocumentsRegulatoryInformation/ucm

056975.htm

USDA

USDA Agricultural Research Service

http://www.ars.usda.gov/Services/docs.htm?docid=15866

Marketing Communication Guidelines – March 2018 Page 85 of 119

USDA Center for Nutrition Policy and Promotion – Nutrition Evidence Library

http://www.cnpp.usda.gov/nutritionevidencelibrary

IFIC

Improving Public Understanding: Guidelines for Communicating Emerging Science on

Nutrition, Food Safety, and Health

http://jnci.oxfordjournals.org/content/90/3/194.full

Marketing Communication Guidelines – March 2018 Page 86 of 119

Appendix D: Social Media Content

Definition: Social media is: Facebook, Twitter, Pinterest, Instagram, Snapchat, YouTube,

LinkedIn, blogs, or any other social-networking Websites. Current marketing communication

guidelines apply to Board created social media content. Boards are responsible for ensuring

messaging, claims, and materials are in compliance with applicable Federal standards and

policies.

General Guidance: Boards will be required to create a social media plan for submission to

AMS for review and approval. Information generated by or on behalf of Boards for posting to

social media Websites is required to be reviewed and pre-approved by USDA prior to the posting

of such materials or be part of previously approved materials. Social media communication

reaches many people; information spreads quickly through electronic channels, sometimes to

unexpected audiences with unintended consequences. Boards are expected to consider all

potential impacts of messaging into account when developing social media content.

Examples of materials requiring AMS pre-approval prior to posting:

• Blog posts prepared by a third party that has a material connection (paid by the Board) to

promotion. The blog must comply with all applicable USDA Research and Promotion

Statutes and FTC rule 16 C.F.R. 255.5 Disclosure of Material Connection.

 Ensure bloggers are informed and aware of their roles and/or

responsibilities in disclosing their connection with the Board when

posting content on the Board’s behalf.

• Blogs generated by the Board.

• Board sound bites, key messages, or talking points prepared for use during an interview

at a live event or “Facebook Live”.

• Viral video campaign developed by the Board for YouTube.

• Twitter post (Twitter handle) related to a newly published research study.

Examples of the use of pre-approved content:

• Tweet of pre-approved messages or content.

• Retweet of a pre-approved message or content.

• Real Time/Live posts:

o If Boards anticipate using real-time posts for events, such plans should be

included in their social media plan and approved by AMS.

o The use of pre-approved talking points, key messages or soundbites during/or at a

live event, such as interviews or Facebook Live.

o Posts of a recipe at a pre-approved promotional event.

o Snapchat of pre-approved message or content at an event.

Marketing Communication Guidelines – March 2018 Page 87 of 119

AMS will not approve or allow use of statements that:

• Use vulgar or abusive language, personal attacks of any kind, or offensive terms targeting

individuals or groups.

• Endorse political parties, candidates, or groups.

• Discuss topics unrelated to the mission.

• Fail to adhere to the posting and disclaimer requirements.

In addition, Boards should ensure they comply with “Terms of Use” agreements on any Websites

or social media outlets they are accessing to ensure compliance with whether or not it is

acceptable to share links or content from a given company.

To ensure compliance with Federal standards and policies, Boards should conduct regular and/or

periodic reviews of information posted by other parties to their social media sites. As part of

USDA’s oversight, marketing specialists will also conduct periodic reviews of Boards’ social

media Website content to ensure compliance with applicable standards. AMS may restrict or

suspend a Board’s use of social media Websites for serious or continuous acts of noncompliance.

Social Media Plan:

Every board and committee is required to have a social media plan that is submitted to AMS for

approval. The social media plan will, at a minimum, include the following information:

• Purpose and scope of the social media plan.

• A list of each social media category that the board or committee will utilize, including a

description of events, activities or campaigns.

• A description of methods for monitoring social media websites connected to events,

activities or campaigns.

• The third party roles and responsibilities, including disclosing their connection with the

board or committee when posting content on behalf of the board or committee.

• Updated at least annually; inform AMS of any interim revisions.

Boards and committees should provide to the extent possible, a social media calendar as part of

their social media plan, for review and approval by AMS. The calendar should include:

• The type of social media.

• The type of activity (social media posts, trade events, speaking engagements, interviews,

etc.).

• When the action will take place.

• Content of the message. (See example below.)

Marketing Communication Guidelines – March 2018 Page 88 of 119

Disclaimers:

All Board Websites and social media that contain links to other Websites or information not

overseen by the Board must include a pop-up transition screen where possible, or a disclaimer,

that alerts the viewer he/she is leaving a Board-funded Website, and explain that the Board is not

responsible for the content and/or claims made by Websites not overseen by the Board.

Examples: To the extent possible, all social media should include a disclaimer. Below is

sample language for various categories:

YouTube site: “The National Honey Board does not endorse other videos on the site, only those

produced by the National Honey Board.” The disclaimer language could be modified for any

type of social media site.

Internet link: “You are leaving the Cranberry Marketing Committee Website. Links to third

party Websites should not be considered an endorsement by the Cranberry Marketing Committee

of that Website or the company that owns it.

Blogs: For consumers or other third party bloggers that have no material connection (not paid by

the Board or committee):“The views expressed below are those of the authors and do not

necessarily represent the views of the Board.”

Hashtags: Hashtags must be pre-approved and in compliance with all applicable rules,

trademarks, and disclosures. For example, language must be included to let the consumer know

when the hashtag is for a sweeps, sweepstakes, or contest.

Example: #FriendsgivingCranberryContest

Best Practices:

Common sense plays a significant role in administering these Guidelines. Only AMS

preapproved or approved content is permitted for use in social media by the Board. The Board

expects those who communicate using social media channels on behalf of the Board to exercise

caution and good judgment with all subject matter they address.

The Board and those who represent the Board in social media efforts will adhere to these

generally accepted practices and guidelines:

• Use only factual statements or depictions and follow the FTC guidelines for advertising,

internet and other marketing materials. All social media must be factually accurate.

• If the Board wants to acknowledge the promotion of other people, groups and

organizations that engage with Board, this acknowledgement may include but is not

limited to, retweets, tagging, post response or re-pinning. This acknowledgement will be

done judiciously to adhere to the guidelines mentioned above. Example situation:

Marketing Communication Guidelines – March 2018 Page 89 of 119

@WhatsGabyCooking tags @HassAvocados in her post about an avocado recipe. Best

practice is to retweet said recipe post or reply to her thanking her for sharing this avocado

usage. Engagement may also include pinning her recipe to Pinterest and/or sharing said

recipe in another platform like Facebook.

• As an instrumentality of the U.S. government, Board’s will not acknowledge or promote

people, groups, organizations or Websites that espouse controversial or partisan views, or

directly or indirectly condone illegal activity.

• Content that the Board would not otherwise be authorized to promote (such as health

claims), will not be retweeted or reposted unless approved by AMS.

• The Board may repost/retweet social media content from Federal government sources

with approval from AMS.

• Retweets or reposts of statements that do not comply with FDA’s food labeling

guidelines will be modified as necessary to be compliant. If this is not possible, the

statements will not be retweeted or reposted.

• Content credit – best practice is to cite the source of a post if content was created by

external source. Example: tag @myplate if Board uses a recipe or tip created by

@myplate.

• The Board will delete defamatory, libelous, offensive, inflammatory, demeaning, hate or

other inappropriate speech. Any posts that are considered personal, threatening, or

contain obscene language will also be removed.

• The Board will review third-party comments on its social media presence in real time.

Comments about commodity health benefits (“commodities helped me lower my blood

pressure”) or effects on diseases (“commodities can help prevent heart disease”) may be

removed if posted.

o Boards may use third party comments on social media as an educational

opportunity for their commodity.

• If possible, the Board will include a statement in the “About” section of its social media

presence explicitly stating that the Board is not responsible for third-party comments.

• Any new claims or deviations from prior approved messaging must be vetted by AMS.

• Ensure bloggers are informed and aware of their roles and/or responsibilities in disclosing

their connection with the Board when posting content on the Board’s behalf.

Prohibited Uses:

Some forms of social media dialogue can be harmful to the Board. The Board and its

approved spokesperson should refrain from inappropriate dialogue or content that is

inconsistent with the guidelines of this policy:

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• No statement or depiction is permitted that disparages another commodity or product.

Any comparison to another commodity or product must be limited to the presentation of

fact-based information or data.

• The Board cannot use others’ trademarks, copyrights, or logos unless explicitly and/or

lawfully permitted. Identify all expressed and implied claims; the Board cannot suggest

claims that cannot otherwise be made directly. Claims must be adequately supported. The

overall takeaway is the key. Without appropriate scientific evidence to support an

underlying claim, Boards should not make claims either through consumer or expert

endorsements that would be deceptive or could not be substantiated if made directly. It is

not enough that a testimonial represents the honest opinion of the endorser.

• No discrimination or hate speech against any individual or industry.

• No visual misrepresentations of other commodities.

• No support or denial of one segment of the industry over another.

• Revealing the Board’s confidential/proprietary information.

• Personal or sensitive information of any kind, unless authorized.

Note: the Board will monitor its own communications to these guidelines. However, social

media platforms are externally owned and maintained Websites. The Board has no control over

Board’s content that others may “tag”.

An example of a required Social Media Plan follows:

[BOARD] Social Media Plan Template

Effective Dates

Executive Summary

These are the guidelines for social media use on behalf of [BOARD]. While representing the

[BOARD], the organization’s approved spokespeople (i.e., Board staff, Board members, interns

or contractors, etc.) contributing to any kind of social media, must adhere to these guidelines.

We expect those who participate in social media on behalf of [BOARD] to be aware, to

understand, and to follow these guidelines.

Execution

All content created for [BOARD] social media channels will adhere to the terms of the

appropriate [ACT], [ORDER], USDA/AMS “Guidelines for AMS Oversight of Commodity

Research and Promotion Programs” and any other applicable rules, regulations, or policies. All

nutritional and factual information used should be sourced from existing approved materials

and/or be sent to AMS for review. An important factor in the success of the [BOARD] social

media campaign will be, to the best of our ability, controlling and directing messages. All

external PR agency social media platforms will be funneled through [BOARD] for approval and

Marketing Communication Guidelines – March 2018 Page 91 of 119

submission. This framework for social media communications and new concepts will be pre-

approved by AMS.

The information, strategies and tactics contained in this plan will be continually and consistently

monitored by [BOARD] and AMS. This plan should be updated at least annually and submitted

to AMS for approval. The [BOARD] approved spokespersons to engage in social media

activities for the [BOARD] include: (List all of the persons, organizations, etc. associated with

the social media plan of the Board).

Content

In general, the content of information in social media outlets must be pre-approved or approved

by AMS or be part of previously approved materials. The [BOARD] should submit a calendar

every month/quarter/yearly to assist AMS with the preapproval process. If a calendar is not

submitted, the content should be delivered to AMS in a plan as specified below (including, but

not limited to these topics). The [BOARD]’s social media channels will be used to communicate

the following information:

Describe who, what, when, where, why and how social media items will be posted to their

respective platforms.

Below are examples of available platforms.

BOARD News Releases- what media will be used to communicate this?

Producer Events -what media will be used to communicate this?

BOARD Events- what media will be used to communicate this?

Marketing Events- what media will be used to communicate this?

This is an example that can serve as a guide in building social media content and/or messaging

and is not mandatory.

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Appendix E: Food Safety

USDA policy must be followed for all claims about food safety.

(i) Proper Handling.

Safe steps in food handling, cooking, and storage are essential in preventing

foodborne illness. Harmful bacteria that may cause illness cannot be seen, smelled,

or tasted. In every step of food preparation, the four guidelines should be followed to

keep food safe:

• Clean: Wash hands and surfaces often.

• Separate: Separate raw meat from other foods.

• Cook: Cook to the right temperature.

• Chill: Refrigerate food promptly.

Food should not be kept out of refrigeration (including preparation and serving time)

for more than 2 hours (1 hour when the weather is above 90 ˚F).

(i) “Safe”

a. A food that must be cooked to prevent the risk of foodborne illness cannot be

described as “safe.”

b. An appropriate statement would be “Thoroughly cooked means thoroughly safe.”

c. It is okay to describe food safety as a goal, such as striving to create a safe

product or wanting consumers to have a safe product.

(ii) Cooking guidance

a. Temperatures and guidance for thorough cooking are:

Product

Minimum Internal

Temperature/Guidance and Rest

Time

Beef, Pork, Veal &

Lamb

Steaks, chops, roasts

145 °F (62.8 °C) and allow to rest for at

least 3 minutes

Ground meats

160 °F (71.1 °C)

Ham

fresh or smoked

(uncooked)

145 °F (60 °C) and allow to rest for at

least 3 minutes

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Fully Cooked Ham

(to reheat)

Reheat cooked hams packaged in

USDA-inspected plants to 140 °F (60

°C) and all others to 165 °F (73.9 °C).

All Poultry

(breasts, whole bird,

legs, thighs, and

wings, ground

poultry, and stuffing)

165 °F (73.9 °C)

Eggs

Cook until yolk and whites are firm

(see b. below)

Egg dishes

160 °F (71.1 °C)

Fish and Shellfish

145 °F (62.8 °C)

Leftovers

165 °F (73.9 °C)

Casseroles

165 °F (73.9 °C)

b. Guidance for egg cooking is to cook until both the white and yolk are firm. For

egg preparations requiring a soft yolk or raw eggs, pasteurized shell eggs or egg

products should be recommended.

A. How an Animal or Commodity was Raised or Grown

As a reference, USDA’s Food Safety and Inspection Service (FSIS) defines a number of

labeling terms, some of which are included below. If there is any discrepancy between what

is here and guidance from FSIS, FSIS guidance controls.

However, given that the guidance below is for meat and poultry labeling, AMS may allow a

broader usage of these terms in R&P materials as long as the information is not misleading.

For example, materials could describe that no eggs from hens given antibiotics will make it

into consumer channels because if laying hens are given antibiotics, their eggs are diverted

from human consumption.

These terms include:

• Certified

• Chemical-free

• Free Range, Free Roaming

• Halal, Zabia Halal

• Kosher

• Natural

• No Antibiotics

• No Hormones

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• Organic

See the chart for definitions.

FSIS: Terms Describing How an Animal or Commodity Was Raised or Grown

Term

Guidance

Certified

In most cases, the term "certified" implies that FSIS and AMS have officially evaluated

a meat product for class, grade, or other quality characteristics (e.g., "Certified Angus

Beef"). When used under other circumstances, the term must be closely associated

with the name of the organization responsible for the "certification" process, e.g.,

"XYZ Company's Certified Beef."

“Certified” could also be used to describe a particular specification or process-verified

claim. It should be defined.

Chemical-Free

The term is not allowed to be used on a label for meat or poultry.

Free Range,

Free Roaming

For poultry:

Producers must demonstrate that the poultry has been allowed access to the outside.

Halal,

Zabia Halal

Products prepared by federally inspected meat packing plants identified with labels

bearing references to "Halal" or "Zabia Halal" must be handled according to Islamic

law and under Islamic authority.

Kosher

"Kosher" may be used only on the labels of meat and poultry products prepared under

rabbinical supervision.

Natural

Natural means a product containing no artificial ingredient or added color and is only

minimally processed. Minimal processing means that the product was processed in a

manner that does not fundamentally alter the product. The label must include a

statement explaining the meaning of the term natural (such as "no artificial ingredients;

minimally processed").

No Hormones

For beef:

The term "no hormones administered" may be approved for use on the label of beef

products if sufficient documentation is provided by the producer showing no hormones

have been used in raising the animals.

For pork or poultry:

Hormones are not allowed in raising hogs or poultry. Therefore, the claim "no

hormones added" cannot be used on the labels of pork or poultry unless it is followed

by a statement that says "Federal regulations prohibit the use of hormones."

No Antibiotics

For red meat and poultry:

The terms "no antibiotics added" may be used on labels for meat or poultry products if

sufficient documentation is provided by the producer demonstrating that the animals

were raised without antibiotics.

Organic

Organic is a labeling term that indicates that the food or other agricultural product has

been produced through approved methods. The organic standards describe the specific

requirements that must be verified by a USDA-accredited certifying agent before

products can be labeled USDA organic. Overall, organic operations must demonstrate

that they are protecting natural resources, conserving biodiversity, and using only

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approved substances. Not permitted are most conventional pesticides; fertilizers made

with synthetic ingredients, or sewage sludge; bioengineering; or ionizing radiation.

Organic meat, poultry eggs, and dairy products come from animals that are given no

antibiotics or growth hormones. The USDA National Organic Program Website has

more information including inspection and certification information.

FDA: Food Drug and Cosmetic Act (FD&CA) and Food Safety Modernization Act

(FSMA)

FDA regulates a broad range of items, including most foods. “Food” is specifically defined as

(1) articles used for food or drink for people or animals; (2) chewing gum; and (3) articles used

for components of any such article. Basically, “Food” includes almost all products except those

regulated by USDA’s FSIS.

FSMA is a prevention oriented law, whereby producers, importers, manufacturers, packers,

shipper and others in the supply chain may be required to comply with the regulations. Most of

the regulations for FSMA were issued in 2015-2016. For specific information about FSMA go

to: www.fda.gov/food/guidanceregulation/fsma.

FD&CA originated in the 1930s, and among other requirements provides for labeling and

adulteration of food provisions. For specific information about FD&CA go to:

www.fda.gov/AboutFDA/WhatWeDo/History/ProductRegulation.

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Appendix F: Environmental Claims

Environmental claims convey a relationship or benefit to the environment.

Examples:

• Natural

• Recyclable

• Sustainable

• Organic

FTC provides guidance for environmental claims in its Guides for the Use of Environmental

Marketing Claims (“Green Guides,” 16 CFR Part 260). This guidance applies to environmental

claims in labeling, advertising, promotional materials, and all other forms of marketing in any

medium, whether asserted directly or by implication, through words, symbols, logos, depictions,

product brand names, or any other means.

This guidance does not preempt any Federal, State, or local laws. However, compliance with

those laws does not necessarily preclude FTC from taking action for claims that are inconsistent

with its environmental claims guidance.

The guidance is based on marketing to a general audience. However, when a marketer targets a

particular segment of consumers, FTC will examine how reasonable members of that group

interpret the advertisement. Whether a particular claim is deceptive will depend on the net

impression of the advertisement, label, or other promotional material at issue.

Key Points:

• Consumers are likely to be confused about environmental claims, so marketers must take

caution not to mislead.

• Provide adequate disclosures.

• Don’t overstate the environmental benefit.

• Watch third-party endorsements (certifications and seals of approval).

• Follow FTC definitions for environmental claims.

• For undefined terms (e.g., sustainability), define what is intended when using this term.

Interpretation and Substantiation

Marketers must ensure all reasonable interpretations of their claims are truthful, not misleading,

and supported by a reasonable basis. In the context of environmental marketing claims, a

reasonable basis often requires competent and reliable scientific evidence. Such evidence

consists of tests, analyses, research, or studies that have been conducted and evaluated in an

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objective manner by qualified persons and are generally accepted in the profession to yield

accurate and reliable results. Such evidence should be sufficient in quality and quantity based on

standards generally accepted in the relevant scientific fields, when considered in light of the

entire body of relevant and reliable scientific evidence, to substantiate that each of the marketing

claims is true.

(i) General Principles

• Terms: Terms should be consistent with FTC’s (or in some cases, another government

agency’s) definitions. See the Specific Claims section below.

• Qualifications and disclosures: To prevent deceptive claims, qualifications and

disclosures should be clear, prominent, and understandable. To make disclosures clear

and prominent, marketers should use plain language and sufficiently large type, should

place disclosures in close proximity to the qualified claim and should avoid making

inconsistent statements or using distracting elements that could undercut or contradict the

disclosure.

• Distinction between benefits of product, package, and service: Unless it is clear from the

context, an environmental marketing claim should specify whether it refers to the

product, the product's packaging, a service, or just to a portion of the product, package, or

service. In general, if the environmental attribute applies to all but minor, incidental

components of a product or package, the marketer need not qualify the claim to identify

that fact. However, there may be exceptions to this general principle. For example, if a

marketer makes an unqualified recyclable claim, and the presence of the incidental

component significantly limits the ability to recycle the product, the claim would be

deceptive.

o Example: A plastic package containing a new shower curtain is labeled

“recyclable” without further elaboration. Because the context of the claim does

not make clear whether it refers to the plastic package or the shower curtain, the

claim is deceptive if any part of either the package or the curtain, other than

minor, incidental components, cannot be recycled.

o Example: A soft drink bottle is labeled “recycled.” The bottle is made entirely

from recycled materials, but the bottle cap is not. Because the bottle cap is a

minor, incidental component of the package, the claim is not deceptive.

• Overstatement of environmental attribute: An environmental marketing claim should not

overstate, directly or by implication, an environmental attribute or benefit. Marketers

should not state or imply environmental benefits if the benefits are negligible.

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o Example: An area rug is labeled “50% more recycled content than before.” The

manufacturer increased the recycled content of its rug from 2% recycled fiber to

3%. Although the claim is technically true, it likely conveys the false impression

that the manufacturer has significantly increased the use of recycled fiber.

o Example: A trash bag is labeled “recyclable” without qualification. Because

trash bags ordinarily are not separated from other trash at the landfill or

incinerator for recycling, they are highly unlikely to be used again for any

purpose. Even if the bag is technically capable of being recycled, the claim is

deceptive since it asserts an environmental benefit where no meaningful benefit

exists.

• Comparative claims. Comparative environmental marketing claims should be clear to

avoid consumer confusion about the comparison. Marketers should have substantiation

for the comparison.

o Example: An advertiser notes that its glass bathroom tiles contain “20% more

recycled content.” Depending on the context, the claim could be a comparison

either to the advertiser's immediately preceding product or to its competitors'

products. The advertiser should have substantiation for both interpretations.

Otherwise, the advertiser should make the basis for comparison clear, for

example, by saying “20% more recycled content than our previous bathroom

tiles.”

o Example: An advertiser claims that “our plastic diaper liner has the most recycled

content.” The diaper liner has more recycled content, calculated as a percentage

of weight, than any other on the market, although it is still well under 100%. The

claim likely conveys that the product contains a significant percentage of recycled

content and has significantly more recycled content than its competitors. If the

advertiser cannot substantiate these messages, the claim would be deceptive.

o Example: An advertiser claims that its packaging creates “less waste than the

leading national brand.” The advertiser implemented the source reduction several

years ago and supported the claim by calculating the relative solid waste

contributions of the two packages. The advertiser should have substantiation that

the comparison remains accurate.

o Example: A product is advertised as “environmentally preferable.” This claim

likely conveys that the product is environmentally superior to other products.

Because it is highly unlikely that the marketer can substantiate the messages

conveyed by this statement, this claim is deceptive. The claim would not be

deceptive if the marketer accompanied it with clear and prominent language

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limiting the environmental superiority representation to the particular attributes

for which the marketer has substantiation, provided the advertisement's context

does not imply other deceptive claims. For example, the claim “Environmentally

preferable: contains 50% recycled content compared to 20% for the leading

brand” would not be deceptive.

(ii) General Environmental Benefit Claims

It is deceptive to misrepresent, directly or by implication that a product, package, or service

offers a general environmental benefit. FTC cautions marketers not to make unqualified general

environmental benefit claims because “it is highly unlikely that marketers can substantiate all

reasonable interpretations of these claims.” Unqualified general environmental benefit claims

are difficult to interpret and likely convey a wide range of meanings. In many cases, such claims

likely convey that the product, package, or service has specific and far-reaching environmental

benefits and may convey that the item or service has no negative environmental impact. Because

it is highly unlikely that marketers can substantiate all reasonable interpretations of these claims,

marketers should not make unqualified general environmental benefit claims.

Marketers may be able to qualify general environmental benefit claims to focus consumers on

the specific environmental benefits that they can substantiate. In doing so, marketers should use

clear and prominent qualifying language to convey that a general environmental claim refers

only to a specific and limited environmental benefit(s).

In addition, FTC cautions marketers that explanations of specific attributes, even when true and

substantiated, will not adequately qualify general environmental marketing claims if an

advertisement's context implies other deceptive claims. Therefore, marketers should ensure that

the advertisement's context does not imply deceptive environmental claims.

Moreover, FTC advises marketers not to imply that any specific benefit is significant if it is, in

fact, negligible.

Finally, FTC states that if a qualified general claim conveys that a product is more

environmentally beneficial overall because of the particular touted benefit, marketers should

analyze trade-offs resulting from the benefit to substantiate this claim.

Example: The brand name “Eco-friendly” likely conveys that the product has far-reaching

environmental benefits and may convey that the product has no negative environmental impact.

Because it is highly unlikely that the marketer can substantiate these claims, the use of such a

brand name is deceptive. A claim such as “Eco-friendly: made with recycled materials” would

not be deceptive if: (1) The statement “made with recycled materials” is clear and prominent; (2)

the marketer can substantiate that the entire product or package, excluding minor, incidental

components, is made from recycled material; (3) making the product with recycled materials

makes the product more environmentally beneficial overall; and

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(4) the ad's context does not imply other deceptive claims.

Example: A marketer states that its packaging is now “Greener than our previous packaging.”

The packaging weighs 15% less than previous packaging, but it is not recyclable nor has it been

improved in any other material respect. The claim is deceptive because reasonable consumers

likely would interpret “greener” in this context to mean that other significant environmental

aspects of the packaging also are improved over previous packaging. A claim stating “Greener

than our previous packaging” accompanied by clear and prominent language such as “We've

reduced the weight of our packaging by 15%” would not be deceptive, provided that reducing the

packaging's weight makes the product more environmentally beneficial overall and the

advertisement's context does not imply other deceptive claims.

Example: A marketer's advertisement features a picture of a laser printer in a bird's nest

balancing on a tree branch, surrounded by a dense forest. In green type, the marketer states,

“Buy our printer. Make a change.” Although the advertisement does not expressly claim that the

product has environmental benefits, the featured images, in combination with the text, likely

convey that the product has far-reaching environmental benefits and may convey that the product

has no negative environmental impact. Because it is highly unlikely that the marketer can

substantiate these claims, this advertisement is deceptive.

Example: A manufacturer's Website states, “Eco-smart gas-powered lawn mower with improved

fuel efficiency!” The manufacturer increased the fuel efficiency by 1/10 of a percent. Although

the manufacturer's claim that it has improved its fuel efficiency technically is true, it likely

conveys the false impression that the manufacturer has significantly increased the mower's fuel

efficiency.

Example: A marketer reduces the weight of its plastic beverage bottles. The bottles' labels state

“Environmentally-friendly improvement: 25% less plastic than our previous packaging.” The

plastic bottles are 25 percent lighter but otherwise are no different. The advertisement conveys

that the bottles are more environmentally beneficial overall because of the source reduction. To

substantiate this claim, the marketer likely can analyze the impacts of the source reduction

without evaluating environmental impacts throughout the packaging's life cycle. If, however,

manufacturing the new bottles significantly alters environmental attributes earlier or later in the

bottles' life cycle, i.e., manufacturing the bottles requires more energy or a different kind of

plastic, then a more comprehensive analysis may be appropriate.

(iii) Certifications and Seals of Approval

According to FTC, it is deceptive to misrepresent that an item or service has been endorsed or

certified by an independent third party.

Also, a marketer’s use of the name, logo, or seal of approval of a third-party certifier or

organization may be an endorsement covered by FTC’s Endorsement Guides (16 CFR Part 255).

Those Endorsement Guides advise that marketers disclose a “material connection” (i.e., a

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connection that might materially affect the weight or credibility of an endorsement). For

instance, marketers featuring certifications from third-party certifiers need not disclose their

payment of a reasonable certification fee if that is their only connection to the certifier. In this

situation, there is no need for disclosure because consumers likely expect that certifiers charge a

reasonable fee for their services. As other examples demonstrate, whether a material connection

exists depends on whether the ties between the marketer and certifier likely affect the weight or

credibility of the certification. If, for example, an independent certifier administers an industry

trade association certification program by objectively applying a voluntary consensus standard

(i.e., a standard that has been developed and maintained by a voluntary consensus standard

body), then the connection between the industry group and the marketer would not likely be

material.

Third-party certification does not eliminate a marketer's obligation to ensure that it has

substantiation for all claims reasonably communicated by the certification.

Voluntary consensus standards bodies are organizations which plan, develop, establish, or

coordinate voluntary consensus standards using agreed-upon procedures. A voluntary consensus

standards body is defined by the following attributes: (1) openness, (2) balance of interest,

(3) due process, (4) an appeals process, (5) consensus, which is defined as general agreement,

but not necessarily unanimity, and includes a process for attempting to resolve objections by

interested parties, as long as all comments have been fairly considered, each objector is advised

of the disposition of his or her objection(s) and the reasons why, and the consensus members are

given an opportunity to change their votes after reviewing the comments.

FTC also advises that an environmental certification or seal likely conveys a general

environmental benefit claim when it does not clearly convey, either through its name or other

means, the basis for the certification. Because it is highly unlikely that marketers can

substantiate such a claim, they should not use environmental certifications or seals that do not

convey the basis for the certification.

FTC further states that marketers should accompany such seals or certifications with clear and

prominent language that effectively conveys that the certification or seal refers only to specific

and limited benefits. This may be particularly challenging with certifications based on

comprehensive, multi-attribute standards.

Finally, FTC states that third-party certification does not eliminate a marketer's obligation to

have substantiation for all conveyed claims.

Example: An advertisement for paint features a “GreenLogo” seal and the statement

“GreenLogo for Environmental Excellence.” This advertisement likely conveys that: (1) the

GreenLogo seal is awarded by an independent, third-party certifier with appropriate expertise in

evaluating the environmental attributes of paint; and (2) the product has far-reaching

environmental benefits. If the paint manufacturer awarded the seal to its own product, and no

Marketing Communication Guidelines – March 2018 Page 103 of 119

independent, third-party certifier objectively evaluated the paint using independent standards, the

claim would be deceptive. The claim would not be deceptive if the marketer accompanied the

seal with clear and prominent language: (1) indicating that the marketer awarded the GreenLogo

seal to its own product; and (2) clearly conveying that the award refers only to specific and

limited benefits.

Example: A manufacturer advertises its product as “certified by the American Institute of

Degradable Materials.” Because the advertisement does not mention that the American Institute

of Degradable Materials (“AIDM”) is an industry trade association, the certification likely

conveys that it was awarded by an independent certifier. To be certified, marketers must meet

standards that have been developed and maintained by a voluntary consensus standard body. An

independent auditor applies these standards objectively. This advertisement likely is not

deceptive if the manufacturer complies with FTC’s Degradable definition because the

certification is based on independently-developed and -maintained standards and an independent

auditor applies the standards objectively.

Example: A product features a seal of approval from “The Forest Products Industry

Association,” an industry certifier with appropriate expertise in evaluating the environmental

attributes of paper products. Because it is clear from the certifier's name that the product has

been certified by an industry certifier, the certification likely does not convey that it was awarded

by an independent certifier. The use of the seal likely is not deceptive provided that the

advertisement does not imply other deceptive claims.

Example: A marketer's package features a seal of approval with the text “Certified Non-Toxic.”

The seal is awarded by a certifier with appropriate expertise in evaluating ingredient safety and

potential toxicity. It applies standards developed by a voluntary consensus standard body.

Although non-industry members comprise a majority of the certifier's Board, an industry veto

could override any proposed changes to the standards. This certification likely conveys that the

product is certified by an independent organization. This claim would be deceptive because

industry members can veto any proposed changes to the standards.

Example: A marketer's industry sales brochure for overhead lighting features a seal with the text

“EcoFriendly Building Association” to show that the marketer is a member of that organization.

Although the lighting manufacturer is, in fact, a member, this association has not evaluated the

environmental attributes of the marketer's product. This advertisement would be deceptive

because it likely conveys that the EcoFriendly Building Association evaluated the product

through testing or other objective standards. It also is likely to convey that the lighting has far-

reaching environmental benefits. The use of the seal would not be deceptive if the manufacturer

accompanies it with clear and prominent qualifying language: (1) indicating that the seal refers

to the company's membership only and that the association did not evaluate the product's

environmental attributes; and (2) limiting the general environmental benefit representations, both

express and implied, to the particular product attributes for which the marketer has

substantiation. For example, the marketer could state: “Although we are a member of the

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EcoFriendly Building Association, it has not evaluated this product. Our lighting is made from

100 percent recycled metal and uses energy efficient LED technology.”

Example: A product label contains an environmental seal, either in the form of a globe icon or a

globe icon with the text “EarthSmart.” EarthSmart is an independent, third-party certifier with

appropriate expertise in evaluating chemical emissions of products. While the marketer meets

EarthSmart's standards for reduced chemical emissions during product usage, the product has no

other specific environmental benefits. Either seal likely conveys that the product has far-

reaching environmental benefits, and that EarthSmart certified the product for all of these

benefits. If the marketer cannot substantiate these claims, the use of the seal would be deceptive.

The seal would not be deceptive if the marketer accompanied it with clear and prominent

language clearly conveying that the certification refers only to specific and limited benefits. For

example, the marketer could state next to the globe icon: “EarthSmart certifies that this product

meets EarthSmart standards for reduced chemical emissions during product usage.”

Alternatively, the claim would not be deceptive if the EarthSmart environmental seal itself

stated: “EarthSmart Certified for reduced chemical emissions during product usage.”

Example: A 1-quart bottle of window cleaner features a seal with the text “Environment

Approved,” granted by an independent, third-party certifier with appropriate expertise. The

certifier granted the seal after evaluating 35 environmental attributes. This seal likely conveys

that the product has far-reaching environmental benefits and that Environment Approved

certified the product for all of these benefits and therefore is likely deceptive. The seal would

likely not be deceptive if the marketer accompanied it with clear and prominent language clearly

conveying that the seal refers only to specific and limited benefits. For example, the seal could

state: “Virtually all products impact the environment. For details on which attributes we

evaluated, go to [a Website that discusses the product].” The referenced Website provides a

detailed summary of the examined environmental attributes. A reference to a Website is

appropriate because the additional information provided on the Website is not necessary to

prevent the advertisement from being misleading. As always, the marketer also should ensure

that the advertisement does not imply other deceptive claims, and that the certifier's criteria are

sufficiently rigorous to substantiate all material claims reasonably communicated by the

certification.

Example: Great Paper Company sells photocopy paper with packaging that has a seal of

approval from the No Chlorine Products Association, a non-profit third-party association. Great

Paper Company paid the No Chlorine Products Association a reasonable fee for the certification.

Consumers would reasonably expect that marketers have to pay for certification. Therefore,

there are no material connections between Great Paper Company and the No Chlorine Products

Association. The claim would not be deceptive.

(iv) Specific Claims

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Examples of specific environmental claims are:

• Carbon offsets

• Compostable

• Degradable

• Free-of

• Natural

• Non-toxic

• Organic

• Ozone-safe

• Ozone-friendly

• Recyclable

• Refillable

• Renewable energy

• Renewable materials

• Source reduction

• Sustainability

See the following charts for definitions and guidance.

FTC: Environmental Claims

FTC has issued the following specific guidance about the following terms in its Green Guides

(16 CFR Part 260, Guides for the Use of Environmental Marketing Claims). However, if there is

any discrepancy between what is here vs. what is in the FTC Guides, those Guides control.

Term/Issue

Definition or Guidance

Carbon offsets

Marketers are advised to have competent and reliable scientific evidence to support

their carbon offset claims, including using appropriate accounting methods to ensure

they are properly quantifying emission reductions and not selling those reductions more

than once. Additionally, marketers should disclose if consumers' offset purchases fund

emission reductions that will not occur for 2 years or longer. Finally, FTC cautions

marketers not to advertise a carbon offset if the activity that forms the basis of the

offset is already required by law. More detailed guidance could quickly become

obsolete given the rapidly changing nature of this market and consumers' minimal

understanding of such issues. Moreover, such guidance might place the FTC in the

inappropriate role of setting environmental policy.

Compostable

Marketers should possess competent and reliable scientific evidence showing that “all

the materials in the product or package will break down into, or otherwise become a

part of, usable compost (e.g., soil-conditioning material, mulch) in a safe and timely

Marketing Communication Guidelines – March 2018 Page 106 of 119

Term/Issue

Definition or Guidance

manner in an appropriate composting program or facility, or in a home compost pile or

device.” A “timely manner” means “in approximately the same time as the materials

with which it is composted.” Marketers should clearly qualify compostable claims, if

(1) the item cannot be composted safely or in a timely manner in a home compost pile

or device or (2) the claim misleads reasonable consumers about the environmental

benefit provided when the item is disposed of in a landfill. To avoid deception about

the limited availability of municipal or institutional composting facilities, a marketer

should clearly and prominently qualify compostable claims if such facilities are

available to a substantial majority of the marketer's consumers where the item is sold.

Example: A manufacturer indicates that its unbleached coffee filter is compostable. The

unqualified claim is not deceptive, provided the manufacturer has substantiation that the

filter can be converted safely to usable compost in a timely manner in a home compost pile

or device. If so, the extent of local municipal or institutional composting facilities is

irrelevant.

Example: A garden center sells grass clipping bags labeled as “Compostable in California

Municipal Yard Trimmings Composting Facilities.” When the bags break down, however,

they release toxins into the compost. The claim is deceptive if the presence of these toxins

prevents the compost from being usable.

Example: A manufacturer makes an unqualified claim that its package is compostable.

Although municipal or institutional composting facilities exist where the product is sold, the

package will not break down into usable compost in a home compost pile or device. To

avoid deception, the manufacturer should clearly and prominently disclose that the package

is not suitable for home composting.

Example: Nationally marketed lawn and leaf bags state “compostable” on each bag. The

bags also feature text disclosing that the bag is not designed for use in home compost piles.

Yard trimmings programs in many communities compost these bags, but such programs are

not available to a substantial majority of consumers or communities where the bag is sold.

The claim is deceptive because it likely conveys that composting facilities are available to a

substantial majority of consumers or communities. To avoid deception, the marketer should

clearly and prominently indicate the limited availability of such programs. A marketer

could state “Appropriate facilities may not exist in your area” or provide the approximate

percentage of communities or consumers for which such programs are available.

Example: A manufacturer sells a disposable diaper that states, “This diaper can be

composted if your community is one of the 50 that have composting facilities.” The claim

is not deceptive if composting facilities are available as claimed and the manufacturer has

substantiation that the diaper can be converted safely to usable compost in solid waste

composting facilities.

Example: A manufacturer markets yard trimmings bags only to consumers residing in

particular geographic areas served by county yard trimmings composting programs. The

bags meet specifications for these programs and are labeled, “Compostable Yard

Trimmings Bag for County Composting Programs.” The claim is not deceptive. Because

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Term/Issue

Definition or Guidance

the bags are compostable where they are sold, a qualification is not needed to indicate the

limited availability of composting facilities.

Degradable

FTC states that it is deceptive to misrepresent, directly or by implication, that a product

or package is degradable, biodegradable, oxo-degradable, oxo-biodegradable, or

photodegradable. The following guidance for degradable claims also applies to

biodegradable, oxo-degradable, oxo-biodegradable, and photodegradable claims.

Marketers should qualify a degradable claim unless it has competent and reliable

scientific evidence that the “entire product or package will completely break down and

return to nature, i.e., decompose into elements found in nature within a reasonably

short period of time after customary disposal.” Marketers should not make unqualified

degradable claims for items destined for the solid waste stream (landfills, incinerators,

or recycling facilities) because complete decomposition in those specific environments

will not occur within 1 year. A marketer making an unqualified degradable claim for

solid items other than those destined for landfills, incinerators, or recycling facilities

should substantiate that the entire item will fully decompose within 1 year after

customary disposal.

Degradable claims should be qualified clearly and prominently to the extent necessary

to avoid deception about: (1) The product's or package's ability to degrade in the

environment where it is customarily disposed; and (2) the rate and extent of

degradation.

FTC’s treatment of unqualified degradable claims is intended to help prevent deception

and is not intended to establish performance standards to ensure the degradability of

products when littered.

Example: A marketer advertises its trash bags using an unqualified “degradable” claim.

The marketer relies on soil burial tests to show that the product will decompose in the

presence of water and oxygen. Consumers, however, place trash bags into the solid waste

stream, which customarily terminates in incineration facilities or landfills where they will

not degrade within one year. The claim is therefore deceptive.

Example: A marketer advertises a commercial agricultural plastic mulch film as

“Photodegradable” and clearly and prominently qualifies the term with the phrase “Will

break down into small pieces if left uncovered in sunlight.” The advertiser possesses

competent and reliable scientific evidence that within 1 year, the product will break down

after being exposed to sunlight into sufficiently small pieces to become part of the soil.

Thus, the qualified claim is not deceptive. Because the claim is qualified to indicate the

limited extent of breakdown, the advertiser need not meet the consumer expectations for an

unqualified photodegradable claim (that the product will not only break down but also will

decompose into elements found in nature).

Example: A marketer advertises its shampoo as “biodegradable” without qualification.

The ad makes clear that only the shampoo, and not the bottle, is biodegradable. The

marketer has competent and reliable scientific evidence demonstrating that the shampoo,

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which is customarily disposed in sewage systems, will break down and decompose into

elements found in nature in a reasonably short period of time in the sewage system

environment. Therefore, the claim is not deceptive.

Example: A plastic six-pack ring carrier is marked with a small diamond. Several state

laws require that the carriers be marked with this symbol to indicate that they meet certain

degradability standards if the carriers are littered. The use of the diamond by itself, in an

inconspicuous location, does not constitute a degradable claim. Consumers are unlikely to

interpret an inconspicuous diamond symbol, without more, as an unqualified

photodegradable claim.

Example: A fiber pot containing a plant is labeled “biodegradable.” The pot is customarily

buried in the soil along with the plant. Once buried, the pot fully decomposes during the

growing season, allowing the roots of the plant to grow into the surrounding soil. The

unqualified claim is not deceptive.

Free Of

For claims that products or services have no, are free of, or do not contain certain

substances: Even if true, claims that an item is free of a substance may be deceptive if:

(1) The item contains substances that pose the same or similar environmental risk as the

substance not present; or (2) the substance has not been associated with the product

category. Such claims should be clearly and prominently qualified to the extent

necessary to avoid deception.

This two-part analysis prevents deception resulting from two implied claims. The first

prong addresses the implied claim that a product is free of negative attributes

associated with that substance. Thus, a free-of claim would still be deceptive even if a

product is free of a particular substance if it has another substance that causes the same

or similar environmental harm. The second prong cautions that free-of claims may

deceive consumers by falsely suggesting that competing products contain the substance

or that the marketer has “improved” the product by removing the substance.

A free-of claim may, in some circumstances, be non-deceptive even though the product

contains a “trace amount” of the substance. (“Trace contaminant” and “background

level” are imprecise terms, may be defined according to the product area, and require a

case-by-case analysis depending on the subject.)

A marketer can make a claim for a product that still contains some amount of a

substance only if: (1) The level of the specified substance is no more than that which

would be found as an acknowledged trace contaminant or background level; (2) the

substance's presence does not cause material harm that consumers typically associate

with that substance; and (3) the substance has not been added intentionally to the

product.

The first prong of this test reflects consumers’ likely expectations that products

advertised as “free of” a substance contain no more than trace amounts that occur

naturally in the environment or in product ingredients. The second prong clarifies that

it is deceptive to make a free-of claim if the product contains any amount of the

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substance that causes material harm that consumers typically associate with that

substance, no matter how small. The third prong recognizes that, if added

intentionally, reasonable consumers would not think that a product was free of that

substance, even if that intentionally-added amount is less than a typical background

level amount of that substance.

Example: A package of t-shirts is labeled “Shirts made with a chlorine-free bleaching

process.” The shirts, however, are bleached with a process that releases a reduced, but still

significant, amount of the same harmful byproducts associated with chlorine bleaching.

The claim overstates the product's benefits because reasonable consumers likely would

interpret it to mean that the product's manufacture does not cause any of the environmental

risks posed by chlorine bleaching. A substantiated claim, however, that the shirts were

“bleached with a process that releases 50% less of the harmful byproducts associated with

chlorine bleaching” would not be deceptive.

Example: A manufacturer advertises its insulation as “formaldehyde free.” Although the

manufacturer does not use formaldehyde as a binding agent to produce the insulation, tests

show that the insulation still emits trace amounts of formaldehyde. The seller has

substantiation that formaldehyde is present in trace amounts in virtually all indoor and (to a

lesser extent) outdoor environments and that its insulation emits less formaldehyde than is

typically present in outdoor environments. Further, the seller has substantiation that the

trace amounts of formaldehyde emitted by the insulation do not cause material harm that

consumers typically associate with formaldehyde. In this context, the trace levels of

formaldehyde emissions likely are inconsequential to consumers. Therefore, the seller's

free-of claim would not be deceptive.

Non-Toxic

FTC finds that it is deceptive to misrepresent that a product, package, or service is non-

toxic. Non-toxic claims should be clearly and prominently qualified to the extent

necessary to avoid deception. FTC also cautions that such claims likely convey that an

item or service is non-toxic both for humans and for the environment. Therefore,

marketers making non-toxic claims should have competent and reliable scientific

evidence that the product, package, or service is non-toxic for humans and for the

environment or should clearly and prominently qualify their claims to avoid deception.

Example: A marketer advertises a cleaning product as “essentially non-toxic” and

“practically non-toxic.” The advertisement likely conveys that the product does not pose

any risk to humans or the environment, including household pets. If the cleaning product

poses no risk to humans but is toxic to the environment, the claims would be deceptive.

Ozone-Safe,

Ozone-Friendly

It is deceptive to misrepresent that a product is safe for, or “friendly” to, the ozone

layer or the atmosphere.

A claim that a product is “ozone-friendly” is deceptive if the product contains any

ozone-depleting substance, including those substances listed as Class I or Class II

chemicals in Title VI of the Clean Air Act Amendments of 1990, Public Law 101-549,

and others subsequently designated by EPA as ozone-depleting substances. [These

chemicals include chlorofluorocarbons (CFCs), halons, carbon tetrachloride, 1,1,1-

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trichloroethane, methyl bromide, hydrobromofluorocarbons, and

hydrochlorofluorocarbons (HCFCs).]

Example: An aerosol air freshener is labeled “ozone-friendly.” Some of the product's

ingredients are volatile organic compounds (VOCs) that may cause smog by

contributing to ground-level ozone formation. The claim likely conveys that the

product is safe for the atmosphere as a whole and is therefore deceptive.

Recyclable

A product or package should not be marketed as recyclable unless it can be collected,

separated, or otherwise recovered from the waste stream through an established

recycling program for reuse or use in manufacturing or assembling another item.

Marketers should qualify recyclable claims when recycling facilities are not available

to a “substantial majority” (in this context, at least 60%) of consumers or communities

where a product is sold. Marketers may qualify recyclable claims by stating the

percentage of consumers or communities that have access to facilities that recycle the

item or use qualifications that vary in strength depending on facility availability. The

lower the levels of access to appropriate facilities, the more strongly the marketer

should emphasize the limited availability of recycling for the product.

Example: If recycling facilities are available to slightly less than a substantial majority of

consumers or communities where the item is sold, a marketer may qualify a recyclable

claim by stating: “This product [package] may not be recyclable in your area” or

“Recycling facilities for this product [package] may not exist in your area.”

Example: If recycling facilities are available only to a few consumers, marketers should

use stronger clarifications. For example, a marketer in this situation may qualify its

recyclable claim by stating: “This product [package] is recyclable only in the few

communities that have appropriate recycling facilities.”

Marketers can make unqualified recyclable claims for a product or package if the entire

product or package, excluding minor incidental components, is recyclable. For items

that are partially made of recyclable components, marketers should clearly and

prominently qualify the claim to avoid deception. If any component significantly limits

the ability to recycle the item, any recyclable claim would be deceptive. An item that is

made from recyclable material but—because of its shape, size, or some other

attribute—is not accepted in recycling programs, should not be marketed as recyclable.

Batteries labeled in accordance with the Mercury-Containing and Rechargeable Battery

Management Act, 42 U.S.C. 14322(b), are deemed to be in compliance with this

guidance.

Example: A packaged product is labeled with an unqualified “recyclable” claim. It is

unclear from the type of product and other context whether the claim refers to the product

or its package. The unqualified claim likely conveys that both the product and its

packaging, except for minor, incidental components, can be recycled. Unless the

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manufacturer has substantiation for both messages, it should clearly and prominently

qualify the claim to indicate which portions are recyclable.

Example: A nationally marketed plastic food container displays the Resin Identification

Code (RIC) (which consists of a design of arrows in a triangular shape containing a number

in the center and an abbreviation identifying the component plastic resin) on the front label

of the container, in close proximity to the product name and logo. This conspicuous use of

the RIC constitutes a recyclable claim. Unless recycling facilities for this container are

available to a substantial majority of consumers or communities, the manufacturer should

qualify the claim to disclose the limited availability of recycling programs. If the

manufacturer places the RIC, without more, in an inconspicuous location on the container

(e.g., embedded in the bottom of the container), it would not constitute a recyclable claim.

Example: A container can be burned in incinerator facilities to produce heat and power. It

cannot, however, be recycled into another product or package. Any claim that the container

is recyclable would be deceptive.

Example: A paperBoard package is marketed nationally and labeled either “Recyclable

where facilities exist” or “Recyclable. Check to see if recycling facilities exist in your area.”

Recycling programs for these packages are available to some consumers, but not available

to a substantial majority of consumers nationwide. Both claims are deceptive because they

do not adequately disclose the limited availability of recycling programs. To avoid

deception, the marketer should use a clearer qualification.

Example: Foam polystyrene cups are advertised as “Recyclable in the few communities

with facilities for foam polystyrene cups.” Half a dozen major metropolitan areas have

established collection sites for recycling those cups. The claim is not deceptive because it

clearly discloses the limited availability of recycling programs.

Example: A package is labeled “Includes some recyclable material.” The package is

composed of four layers of different materials, bonded together. One of the layers is made

from recyclable material, but the others are not. While programs for recycling the 25% of

the package that consists of recyclable material are available to a substantial majority of

consumers, only a few of those programs have the capability to separate the recyclable layer

from the non-recyclable layers. The claim is deceptive for two reasons. First, it does not

specify the portion of the product that is recyclable. Second, it does not disclose the limited

availability of facilities that can process multi-layer products or materials. An appropriately

qualified claim would be “25% of the material in this package is recyclable in the few

communities that can process multi-layer products.”

Example: A product container is labeled “recyclable.” The marketer advertises and

distributes the product only in Missouri. Collection sites for recycling the container are

available to a substantial majority of Missouri residents but are not yet available nationally.

Because programs are available to a substantial majority of consumers where the product is

sold, the unqualified claim is not deceptive.

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Example: A manufacturer of one-time use cameras, with dealers in a substantial majority

of communities, operates a take-back program that collects those cameras through all of its

dealers. The manufacturer reconditions the cameras for resale and labels them “Recyclable

through our dealership network.” This claim is not deceptive, even though the cameras are

not recyclable through conventional curbside or drop-off recycling programs.

Example: A manufacturer advertises its toner cartridges for computer printers as

“Recyclable. Contact your local dealer for details.” Although all of the company's dealers

recycle cartridges, the dealers are not located in a substantial majority of communities

where cartridges are sold. Therefore, the claim is deceptive. The manufacturer should

qualify the claim.

Example: An aluminum can is labeled “Please Recycle.” This statement likely conveys

that the can is recyclable. If collection sites for recycling these cans are available to a

substantial majority of consumers or communities, the marketer does not need to qualify the

claim.

Recycled

Content

FTC states that it is deceptive to misrepresent, directly or by implication, that a product

or package is made of recycled content. Recycled content includes recycled raw

material as well as used, reconditioned, and re-manufactured components.

FTC also states that marketers should make recycled content claims only for a product

or package made of materials that were recovered or otherwise diverted from the waste

stream, either during the manufacturing process (pre-consumer) or after consumer use

(post-consumer). If the source of recycled content includes pre-consumer material, the

advertiser should have substantiation that the pre-consumer material would otherwise

have entered the waste stream. Recycled content claims may--but do not have to--

distinguish between pre-consumer and post-consumer materials. Where a marketer

distinguishes between pre-consumer and post-consumer materials, it should have

substantiation for any express or implied claim about the percentage of pre-consumer

or post-consumer content in an item.

Marketers can make unqualified claims of recycled content if the entire product or

package, excluding minor, incidental components, is made from recycled material. For

items that are partially made of recycled material, the marketer should clearly and

prominently qualify the claim to avoid deception about the amount or percentage, by

weight, of recycled content in the finished product or package.

Additionally, marketers should qualify claims for products or packages only partially

made from recycled material. (This does not include alternative auto recyclers because

a recycled content claim for reused auto parts is true regardless of who sells them.)

For products that contain used, reconditioned, or re-manufactured components, the

marketer should clearly and prominently qualify the recycled content claim to avoid

deception about the nature of such components. No such qualification is necessary

where it is clear to reasonable consumers from context that a product's recycled content

consists of used, reconditioned, or re-manufactured components.

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Example: A manufacturer collects spilled raw material and scraps from the original

manufacturing process. After a minimal amount of reprocessing, the manufacturer

combines the spills and scraps with virgin material for use in production of the same

product. A recycled content claim is deceptive since the spills and scraps are normally

reused by industry within the original manufacturing process and would not normally have

entered the waste stream.

Example: Fifty percent of a greeting card's fiber weight is composed from paper that was

diverted from the waste stream. Of this material, 30% is post-consumer and 20% is pre-

consumer. It would not be deceptive if the marketer claimed that the card either ”contains

50% recycled fiber” or “contains 50% total recycled fiber, including 30% post-consumer

fiber.”

Example: A paperBoard package with 20% recycled fiber by weight is labeled “20% post-

consumer recycled fiber.” The recycled content was composed of overrun newspaper stock

never sold to customers. Because the newspapers never reached consumers, the claim is

deceptive.

Example: A product in a multi-component package, such as a paperBoard box in a shrink-

wrapped plastic cover, indicates that it has recycled packaging. The paperBoard box is

made entirely of recycled material, but the plastic cover is not. The claim is deceptive

because, without qualification, it suggests that both components are recycled. A claim

limited to the paperBoard box would not be deceptive.

Example: A manufacturer makes a package from laminated layers of foil, plastic, and

paper, although the layers are indistinguishable to consumers. The label claims that “one of

the three layers of this package is made of recycled plastic.” The plastic layer is made

entirely of recycled plastic. The claim is not deceptive, provided the recycled plastic layer

constitutes a significant component of the entire package.

Example: A frozen dinner package is composed of a plastic tray inside a cardBoard box. It

states “package made from 30% recycled material.” Each packaging component is one-half

the weight of the total package. The box is 20% recycled content by weight, while the

plastic tray is 40% recycled content by weight. The claim is not deceptive, since the

average amount of recycled material is 30%.

Example: A manufacturer labels a paper greeting card “50% recycled fiber.” The

manufacturer purchases paper stock from several sources, and the amount of recycled fiber

in the stock provided by each source varies. If the 50% figure is based on the annual

weighted average of recycled material purchased from the sources after accounting for fiber

loss during the papermaking production process, the claim is not deceptive.

Example: A packaged food product is labeled with a Möbius loop (symbol with three

chasing arrows) without explanation. By itself, the symbol likely conveys that the

packaging is both recyclable and made entirely from recycled material. Unless the marketer

has substantiation for both messages, the claim should be qualified. The claim may need to

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be further qualified, to the extent necessary, to disclose the limited availability of recycling

programs and/or the percentage of recycled content used to make the package.

Example: In an office supply catalog, a manufacturer advertises its printer toner cartridges

“65% recycled.” The cartridges contain 25% recycled raw materials and 40%

reconditioned parts. The claim is deceptive because reasonable consumers likely would not

know or expect that a cartridge's recycled content consists of reconditioned parts. It would

not be deceptive if the manufacturer claimed “65% recycled content; including 40% from

reconditioned parts.”

Example: A store sells both new and used sporting goods. One of the items for sale in the

store is a baseball helmet that, although used, is no different in appearance than a brand new

item. The helmet bears an unqualified “Recycled” label. This claim is deceptive because

reasonable consumers likely would believe that the helmet is made of recycled raw

materials, when it is, in fact, a used item. An acceptable claim would bear a disclosure

clearly and prominently stating that the helmet is used.

Example: An automotive dealer, automobile recycler, or other qualified entity recovers a

serviceable engine from a wrecked vehicle. Without repairing, rebuilding, re-

manufacturing, or in any way altering the engine or its components, the dealer attaches a

“Recycled” label to the engine, and offers it for sale in its used auto parts store. In this

situation, an unqualified recycled content claim likely is not deceptive because reasonable

consumers in the automotive context likely would understand that the engine is used and

has not undergone any rebuilding.

Refillable

It is deceptive to misrepresent, directly or by implication, that a package is refillable. A

marketer should not make an unqualified refillable claim unless the marketer provides

the means for refilling the package. The marketer may either provide a system for the

collection and refill of the package, or offer for sale a product that consumers can

purchase to refill the original package.

Example: A container is labeled “refillable three times.” The manufacturer has the

capability to refill returned containers and can show that the container will withstand being

refilled at least three times. The manufacturer, however, has established no collection

program. The unqualified claim is deceptive because there is no means to return the

container to the manufacturer for refill.

Example: A small bottle of fabric softener states that it is in a “handy refillable container.”

In the same market area, the manufacturer also sells a large-sized bottle that consumers use

to refill the smaller bottles. The claim is not deceptive because there is a reasonable means

for the consumer to refill the smaller container.

Renewable

Energy

Marketers should avoid making unqualified renewable energy claims, directly or by

implication, based on energy derived from fossil fuels unless they match such claims

with renewable energy certificates (“RECs”). Additionally, FTC cautions marketers

that consumers likely interpret renewable energy claims differently from how

marketers may intend. Accordingly, unless marketers have substantiation for all their

express and reasonably implied claims, they should clearly and prominently qualify

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their renewable energy claims. One way to minimize the risk of deception is to specify

the renewable energy source (e.g., wind or solar energy).

FTC also advises against making unqualified “made with renewable energy” claims

unless all, or virtually all, of the significant manufacturing processes involved in

making a product are powered with renewable energy or non-renewable energy

matched with RECs. When this is not the case, marketers should clearly and

prominently specify the percentage of renewable energy that powered the significant

manufacturing processes involved in making the product or package.

Finally, FTC finds that it would be deceptive for a marketer that represents, directly or

by implication, that it uses renewable energy or uses the term “hosting” when a

marketer generates renewable power but has sold all of the renewable attributes of that

power. However, not all generation claims by such marketers are deceptive.

Example: A marketer advertises its clothing line as “made with wind power.” The

marketer buys wind energy for 50% of the energy it uses to make the clothing in its line.

The marketer's claim is deceptive because reasonable consumers likely interpret the claim

to mean that the power was composed entirely of renewable energy. If the marketer stated,

“We purchase wind energy for half of our manufacturing facilities,” the claim would not be

deceptive.

Example: A company purchases renewable energy from a portfolio of sources that includes

a mix of solar, wind, and other renewable energy sources in combinations and proportions

that vary over time. The company uses renewable energy from that portfolio to power all of

the significant manufacturing processes involved in making its product. The company

advertises its product as “made with renewable energy.” The claim would not be deceptive

if the marketer clearly and prominently disclosed all renewable energy sources.

Alternatively, the claim would not be deceptive if the marketer clearly and prominently

stated, “made from a mix of renewable energy sources” and specified the renewable source

that makes up the greatest percentage of the portfolio. The company may calculate which

renewable energy source makes up the greatest percentage of the portfolio on an annual

basis.

Example: An automobile company uses 100% non-renewable energy to produce its cars.

The company purchases renewable energy certificates to match the non-renewable energy

that powers all of the significant manufacturing processes for the seats, but no other parts,

of its cars. If the company states, “The seats of our cars are made with renewable energy,”

the claim would not be deceptive, as long as the company clearly and prominently qualifies

the claim such as by specifying the renewable energy source.

Example: A company uses 100% non-renewable energy to manufacture all parts of its

product, but powers the assembly process entirely with renewable energy. The claim would

not be deceptive if the marketer advertised its product as “assembled using renewable

energy.”

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Example: A toy manufacturer places solar panels on the roof of its plant to generate power,

and advertises that its plant is “100% solar-powered.” The manufacturer, however, sells

renewable energy certificates based on the renewable attributes of all the power i

t generates.

Even if the manufacturer uses the electricity generated by the solar panels, it has, by selling

renewable energy certificates, transferred the right to characterize that electricity as

renewable. The manufacturer's claim is therefore deceptive. It also would be deceptive for

this manufacturer to advertise that it “hosts” a renewable power facility because reasonable

consumers likely interpret this claim to mean that the manufacturer uses renewable energy.

However, it would not be deceptive for the manufacturer to advertise, “We generate

renewable energy but sell all of it to others.”

Renewable

Materials

Similar to the renewable energy guidance, FTC advises that consumers are likely to

interpret renewable materials differently from how marketers may intend.

Accordingly, FTC advises that unless marketers have substantiation for all their express

and reasonably implied claims, they should clearly and prominently qualify renewable

materials claims. For example, marketers can minimize the likelihood of unintended

implied claims—such as recyclable, degradable, and made with recycled content—by

specifying the material used and why the material is renewable. Additionally,

marketers should further qualify these claims for products containing less than 100%

renewable materials, excluding minor, incidental components.

Example: A marketer makes the unqualified claim that its flooring is “made with

renewable materials.” Reasonable consumers likely interpret this claim to mean that the

flooring also is made with recycled content, recyclable, and biodegradable. Unless the

marketer has substantiation for these implied claims, the unqualified “made with renewable

materials” claim is deceptive. The marketer could qualify the claim by stating, clearly and

prominently, “Our flooring is made from 100 percent bamboo, which grows at the same

rate, or faster, than we use it.” The marketer still is responsible for substantiating all

remaining express and reasonably implied claims.

Example: A marketer's packaging states, “Our packaging is made from 50% plant-based

renewable materials. Because we turn fast-growing plants into bio-plastics, only half of our

product is made from petroleum-based materials.” By identifying the material used and

explaining why the material is renewable, the marketer has minimized the risk of

unintended claims that the product is made with recycled content, recyclable, and

biodegradable and has adequately qualified the amount of renewable materials in the

product.

Source

Reduction

It is deceptive to misrepresent, directly or by implication, that a product or package has

been reduced or is lower in weight, volume, or toxicity. Marketers should clearly and

prominently qualify source reduction claims to the extent necessary to avoid deception

about the amount of the source reduction and the basis for any comparison.

Example: An advertiser claims that disposal of its product generates “10% less waste.”

The marketer does not accompany this claim with a general environmental benefit claim.

Because this claim could be a comparison to the advertiser's immediately preceding product

or to its competitors' products, the advertiser should have substantiation for both

interpretations. Otherwise, the advertiser should clarify which comparison it intends and

have substantiation for that comparison. A claim of “10% less waste than our previous

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product” would not be deceptive if the advertiser has substantiation that shows that the

current product's disposal contributes 10% less waste by weight or volume to the solid

waste stream when compared with the immediately preceding version of the product.

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FTC has not defined the terms below but has either offered guidance or directed marketers to

other sources (e.g., to USDA to vet organic claims):

Term

Guidance

Natural

FTC lacks evidence on which to base general guidance. However, USDA FSIS defines

natural as this: A product containing no artificial ingredient or added color and is only

minimally processed. Minimal processing means that the product was processed in a

manner that does not fundamentally alter the product. The label must include a

statement explaining the meaning of the term natural (such as "no artificial ingredients;

minimally processed").

Organic

FTC has avoided providing advice that would be duplicative or inconsistent with the

USDA’s National Organic Program (NOP). Therefore, any references to organic

production should be vetted by AMS NOP.

Sustainable

FTC lacks evidence on which to base general guidance. Marketers should ensure that

they define the term when it is used so that consumers understand what is meant.