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Senate/House Committee Action
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Visit http://www.aaf.org/government/report.html to view the AAF Government Report archive.

March 5, 2009
Government Report

Jeff Perlman, Chief Operating Officer
Clark Rector Jr., Senior Vice President – State Government Affairs
Robert Kohlmeyer, Manager – Government Affairs

Rep. Waxman Reintroduces Tobacco Advertising Legislation

The House Energy and Commerce Committee has approved a bill that would transfer authority of tobacco advertising from the Federal Trade Commission to the Food and Drug Administration. H.R. 1256, the Family Smoking and Tobacco Control Act, would also direct the secretary of the Department of Health and Human Services to publish an interim rule enacting unprecedented advertising restrictions, including requiring many tobacco ads to be black text on a white background, mandating a government-dictated “brief statement” (in addition to the current Surgeon General’s warning), and banning all outdoor advertising for tobacco products within 1,000 feet of any elementary or secondary school or playground. Introduced by Energy and Commerce Committee Chairman Henry Waxman, D-Calif., the proposal is similar to a measure that passed the House last year, but was not considered by the Senate. An amendment introduced by Rep. Steve Buyer, R-Ind., would have removed most of the advertising restrictions in the bill and created a new program within the Department of Health and Human Services to regulate tobacco, rather than give the authority to the FDA. The AAF believes that advertising authority should remain with the FTC, the agency with the most experience and expertise in the regulation of consumer advertising. We are concerned that the advertising restrictions could be seen next in attacks on other forms of advertising, including alcohol, lotteries, food and even pharmaceuticals. The AAF sent a letter to members of the committee urging their opposition to the proposal, which is available here. Additionally, the AAF sent an alert to its members on the bill, available here, and a media alert condemning the proposal, available here.

Sens. Harkin, Brownback Seek Review of Food Marketing to Children

Senators Tom Harkin, D-Iowa, and Sam Brownback, R-Kan., have inserted language in the Omnibus Appropriations Bill currently before Congress that would create a new interagency group to examine food marketing to children. The group, led by the Federal Trade Commission, Food and Drug Administration, Centers for Disease Control and the U.S. Department of Agriculture, would study existing efforts and develop recommendations for change. The AAF believes this effort is duplicative of the Federal Trade Commission’s workshops examining progress made in food marketing efforts. The proposal also overlooks the outstanding self-regulatory work conducted by the Children’s Food and Beverage Advertising Initiative, led by 15 major food and beverage companies, as well as the National Advertising Review Council and the Children’s Advertising Review Unit.

Obama Names New Commissioners at FTC and FCC

President Barack Obama has designated Federal Trade Commissioner Jon Leibowitz as the new FTC chairman. Leibowitz, a Democrat, was first named a commissioner in 2004. Recently, Leibowitz has scrutinized behavioral advertising practices, calling on industry “to do a better job of meaningful, rigorous self-regulation, or it will certainly invite legislation by Congress and a more regulatory approach by our commission.” Because Leibowitz was already a commissioner, he does not require Senate confirmation in order to become chairman.

President Obama has nominated Julius Genachowski to chair the Federal Communications Commission. Genachowski was previously an adviser to Obama’s campaign and worked at the FCC from 1994 to 1997 as chief counsel to the chairman and as special counsel.

AAF Sends Letter Opposing New York Behavioral Marketing Bill

The AAF and a broad industry coalition have written to the speaker of the New York Assembly to oppose a bill that would unfairly regulate online behavioral marketing in the state. Assembly Bill 1393, introduced by Assemblyman Richard Brodsky, D-Westchester, would establish strict guidelines regarding the collection of nonpersonally identifiable information, including disclosure and prior consent. In our letter, the AAF argues that behavioral marketing benefits consumers by making online content and services free of charge to end users. Consumers and marketers both benefit from receiving advertisements that are appropriately targeted. A copy of the letter is available here.

Florida Tax Committee May Consider Advertising Tax Exemption

Florida’s House Finance and Tax Committee has released a list of 51 specific sales tax exemptions they will review in the upcoming legislative session, including several that will directly impact the advertising industry. In addition to removing the exemption on advertising services, the committee’s list includes exemptions on newspaper and magazine subscriptions, film and printing supplies, certain printed materials and printing services for out-of-state customers providing their own paper. AAF – Fourth District has contacted the tax committee to oppose the consideration of any advertising-related service as a new revenue source and will continue to work closely with legislators in the coming weeks.

March 12, 2009
Government Report

AAF Files Comments on Proposed Changes to FTC’s Endorsement and Testimonials Guides

The American Advertising Federation and American Association of Advertising Agencies have filed joint comments to the Federal Trade Commission arguing against proposed wholesale changes to the agency’s existing Guides Concerning the Use of Endorsements and Testimonials in Advertising. The new guides would virtually do away with the commonly used and understood “results not typical” disclaimer often used by individual endorsers of a product and would mandate a burdensome mandatory disclaimer of generally expected results. The proposed guidelines would also place an unfair burden on bloggers and other viral marketers by requiring unreasonable disclosure of material connections. For example, a blogger reviewing a video game system could be subject to liability by not disclosing that he or she was sent a complimentary copy to review. The FTC bases the proposed changes on two flawed and limited studies. Our comments ask the commission to slow the process and ensure that any future changes be better substantiated by research. A copy of our letter can be found here.

New Mexico Legislation Restricting Outdoor Alcohol Advertising Introduced

New Mexico Senator Mary Jane Garcia, D-Dona Ana, has introduced a bill that would prohibit outdoor alcohol advertising within 500 feet of any public playground, school or child care facility. Senate Bill 514, the Limiting Alcohol Near Youth Act, would also direct the alcohol and gaming division of the regulation and licensing department to appoint a youth alcohol advertising monitor. The AAF sent an alert to its New Mexico members urging that they contact members of the Senate to ask them to oppose the bill. In 2001, the Supreme Court struck down a Massachusetts law prohibiting outdoor tobacco advertising within 1,000 feet of schools and playgrounds. Additionally, the Outdoor Advertising Association of America Advertising Practices for Children already includes the rejection of advertising for all products illegal for sale to minors within 500 feet of schools, public playgrounds and established places of worship. A copy of our alert is available here.

Utah Video Game Ratings Bill Passes House

The Utah House of Representatives has approved a bill that would penalize retailers who permit the sale of mature-rated video games to children. House Bill 353, introduced by Rep. Michael Morley, R-Spanish Fork, would amend Utah’s “Truth in Advertising” law to target stores that promote compliance with the Entertainment Software Ratings Board (ESRB) system but sell mature games to minors. Retailers would face a fine of $2,000 per incident. According to the ESRB, a May 2008 FTC study found that nationally, retailers refused to sell mature-rated games to customers under 17 years old 80 percent of the time, far surpassing comparable compliance rates for movies and music. In Utah, compliance with the voluntary policy reached 94 percent.

AAF Holds Two Meet and Greets

The American Advertising Federation held two meet and greets this week. Industry leaders in Chicago met with Rep. Jan Schakowsky, D-Ill., to discuss advertising regulation in the new Congress. Schakowsky sits on the important House Energy and Commerce Committee and is vice chair of the Subcommittee on Commerce, Trade and Consumer Protection. The Energy and Commerce Committee has jurisdiction over the Federal Trade Commission and most advertising issues, including direct-to-consumer advertising of pharmaceuticals, food marketing and behavioral advertising.

In Washington, the AAF hosted a meet and greet with Eileen Harrington, acting director of the Federal Trade Commission’s Bureau of Consumer Protection. Harrington discussed the presidential transition’s effects on the agency, congressional efforts to refocus the FTC’s direction, and the proposed multiagency task force that would reexamine food marketing to children.

The AAF’s next meet and greet is scheduled for April 22 in Washington, D.C., with Rep. Bruce Braley, R-Iowa.

March 19, 2009
Government Report