Laymens Corner: Understanding Ad Law

Posted: 7/28/2009

Attention. Interest. Desire. Action. That's the formula for advertising. Advertising law defines how to get that attention, keep your interest, cultivate your desire for a product, and get you to buy it. Unscrupulous advertisers prompted the Federal Trade Commission to set down rules to keep consumers from unsafe marketing practices. It comes down to determining what type of advertising is ethical and to what age group. Basically if advertisers make a claim, they need to back it up or risk censure by the law. Law is based on defined authority, although not always black and white. Ethical behavior, on the other hand, tends to be subjective, although logic tells us that adherence to an ethical, if not moral, law, should be expected, and not abridged by human self-interest, a tough standard to maintain.

Advertising Ethics

Advertising History

 The First Amendment

"Commercial Speech" that is not misleading or that does not falsify advertising claims has been protected under the First Amendment since 1976. Advertising "free speech" hasn't always been this succinct. Back in 1942, the idea was first brought up, albeit casually, by the U.S. Supreme Court. It took nearly 60 years to hone that idea. In 2001, the Supreme Court accepted tobacco advertising as protected under the First Amendment.

Wheeler-Lea Act

The Wheeler-Lea Act of 1938 is actually an amendment to Section 5 of the Federal Trade Commission Act of 1914. The amendment adds to the FTC Act the following statement: " “Unfair methods of competition in commerce and unfair or deceptive acts or practices in commerce are hereby declared unlawful.” In short, misleading and deceptive advertising became illegal, giving the FTC power to levy fines and issue "cease-and-desist" orders to violators.

FTC Policy Statements

The Federal Trade Commission's policy statements are designed to disclose FTC policy on advertising and the FTC's role in the enforcement of those principles and laws. Statements on comparative advertising, advertising claim substantiation, Internet advertising, and deceptive practices are representative of those types of statements available to businesses, marketers and consumers.

Subliminal Appeals

Subliminal messaging is not fodder of science fiction. Advertisers use it to leave an imprint on your brain about its product without you knowing it. They can be in the form of images, sounds, or words. Everyone knows sex sells products. Most everyone is interested in or engages in sexual activity on some level. What does a car have to do with sex? Put a beautiful or handsome model at the wheel and immediately it gets your attention, the background music staying in your mind.

Regulations: Tobacco & Alcohol

Although the First Amendment protects tobacco advertising, advertisements are still targeted by the FTC, the FDA and other federal regulators to ensure that advertising tobacco companies do not market to minors. It is not considered censure when scientific studies back up the fact that tobacco and smoking is harmful to the human body. Tobacco advertisers must fully disclose all the risks and not market to minors.

Children's Television Act

The 1990 Children's Television Act was designed to mandate at least three hours of educational programming daily for children. Within this act includes provisions for advertising. It defines core programming, the hours it must be available, and for the age group, currently age 16 and under. Commercial advertising is limited to under 12 minutes an hour.

Product Labeling

Product labeling is designed to keep consumers informed about possible safety concerns and to give them the opportunity to make informed choices about their consumer selections. For instance, the label must match the product. Labels must be "truthful, accurate, and substantiated" with evidence to back up any labeling claims. The FTC does not simply look at wording, but it looks at labeling and advertising from the consumer point of view, after all, they are the ones making the decision to purchase a product. So they look at the context of a label, which not only informs but also "advertises" brands, as a whole. Its pictures must convey truth, its phrasings, its words. If a food is being marketed as "low-fat" it better meet with the FDA criteria for low-fat foods. Expressed, factual claims and implied claims make labeling a challenge for manufacturers from the marketing point of view.

Environmental Marketing Regulations

"Going green" is big business. In 1992, the FTC issued its "Green Guides" designed to aid marketers to comply with marketing, advertising, and product labeling. The guides mandate what disclosures must be made about a product, whether any product claims are applicable to all or part of a product, presentation of those claims for comparison's sake, and so that the product's "green" benefits are accurate and not overstated. The guides also address environmental and ozone friendliness, recycled content and ability to be recycled, and whether the product degrades or can be composted.


Federal Law prohibits telemarketers from harassing consumers, demands full disclosure of their identity and call purpose, and mandates that calls only be made from 8 a.m. to 9 p.m. The law gives authority to state attorney generals to file civil suits against violators on behalf of their state's residents. Automatic dialing systems are also prohibited under the 1991 Telephone Consumer Protection Act. These laws evolved into the 2003 law prohibiting telemarketers to call anyone on the National Do-Not-Call list, imposing hefty fines for those indicted. Many states also have a similar state-level Do-Not-Call list, but some have been continually challenged under the guise of "commercial speech."

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