6(b) or not 6(b): That is the question

Does the IRS have a Form 1039?  Do drivers ever get their kicks on Route 67?  And does 3.14158 ever feel unappreciated because pi gets all the attention?

Most attorneys and business executives are familiar with Section 5 of the FTC Act, which outlaws unfair or deceptive trade practices.  But Section 6 also plays a critical role in protecting consumers.  Specifically, Section 6(b) authorizes the FTC to get information from companies — “special reports” — about certain aspects of their business.

Under the provisions of Section 6, the FTC recently sent orders to 14 major alcoholic beverage advertisers asking for data about their marketing practices.  The purpose?  So the agency can study whether voluntary industry guidelines for reducing advertising and marketing to underage audiences have been effective.

This isn’t the first time the FTC has requested data like that.  Based on information received under Section 6, the FTC issued studies in 1999, 2003, and 2008 about alcohol advertising and marketing.  Recommendations resulted in agreements by the Beer Institute, the Wine Institute, and the Distilled Spirits Council of the United States to adopt:

  • improved voluntary ad placement standards;
  • media buying guidelines for placing ads on radio and TV, in print, and on the Internet;
  • a requirement that suppliers conduct periodic internal audits of past placements; and
  • systems for outside review of compliance complaints.

Like past orders, the FTC has asked for data about advertising expenditures and placement.  But there’s also something new.  For the first time, the FTC wants information about Internet and digital marketing and data collection practices.

Bookmark the FTC portal on Alcohol Advertising and Marketing to follow the latest.

 

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