BBB Adds Negative Option Guidance to Advertising Code

For the first time, the Better Business Bureau (BBB) has added guidance on negative option billing plans to its “Code of Advertising.” The Code governs advertising disputes for the 112 BBB chapters in the US and Canada. Although the BBB is best known for disputes through the National Advertising Division (NAD), the BBB’s local chapters last year dealt with more than 10,000 advertising disputes and the BBB reports that complaints about negative option plans alone number in the thousands annually.

The BBB’s advertising guidance generally does not differ significantly from Federal Trade Commission (FTC) guidance, but it could indicate growing scrutiny in negative option plans. Among other suggestions, the BBB Code of Advertising notes that negative option features must i) include a clear and conspicuous disclosure of all material terms; ii) disclose how consumers can return items that they do not want; and iii) that advertisers must not interpret a consumer’s silence as consent to enroll in a negative option feature.

For additional background on negative options, please see our past client alerts, available here and here.

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