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Truth-in-Advertising Laws

Advertising & Marketing

Truth-in-Advertising Laws

Advertising laws are aimed at protecting consumers by requiring advertisers to be truthful about their products and to be able to substantiate their claims. All businesses must comply with advertising and marketing laws, and failure to do so could result in costly lawsuits and civil penalties. So before you start an advertising campaign, it's important you understand some basic rules.

The Federal Trade Commission (FTC) is the main federal agency that enforces advertising laws and regulations. Under the Federal Trade Commission Act:

  • Advertising must be truthful and non-deceptive;
  • Advertisers must have evidence to back up their claims; and
  • Advertisements cannot be unfair.

Additional laws apply to ads for specialized products like consumer leases, credit, 900 telephone numbers, and products sold through mail order or telephone sales. State and local governments also regulate advertising, and enforcement is usually the responsibility of a state attorney general, a consumer protection agency or a local district attorney.

The following resources and how-to guides help small business owners comply with federal advertising laws:

General Information

Pricing Rules

Endorsements and Testimonials

State and Local Advertising Laws

Individual states and some localities have also passed specific truth-in-advertising laws. The Consumer Action Handbook provides links to state and local agencies responsible for enforcing truth-in-advertising and related consumer protection laws.

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