Recognizing the potential consequences of false advertising, including financial harm to consumers, erosion of trust in corporations and unfair competition between said corporations,
Understanding that regulations are needed to make sure that products and corporations are truthfully represented,
The General Assembly hereby:
- For the purposes of this resolution, defines “corporations” as organizations recognized by law as a single entity which is engaged in commercial activities, for example companies and other organizations, regardless of their structure or ownership.
- It also defines “advertising” as a paid form of communication intended to influence consumers’ behaviors and draw audiences’ attention to a product or service. The payment used to create the advertisment [sic] is required to be given by the seller, and "advertiser" as the corporation that is engaged in advertising activities.
- Requires corporations to:
- Make sure that all advertising materials used, including but not limited to product descriptions, testimonies and claims are truthful.
- Substantiate controversial claims with supporting evidence when practicable.
- Disclose clearly the relationship between individuals who have close relationships with a corporation and said corporation when they give testimonies about the corporation being advertised.
- Requires corporations to disclose any information that may influence consumer behavior regarding said advertising product, including but not limited to potential side effects or risks due to the consumption of the advertised product or service.
- Corporations are not required to disclose specific details about competitor's pricing.
- Mandates corporations to show reasonable amounts of evidence for factual claims when such evidence is requested by authorities, such as endorsements or awards made in their advertising which have been conducted by independent evaluation.
- Subjective opinions, such as general praise or exaggerated comments should be distinguished as non-objective descriptions.
- Factual claims must not be exaggerated in a way that is misleading to consumers.
- Establishes the “Fair Advertising Commission”, which in the case that above advertising standards are not followed through and domestic authorities have not taken action, will conduct investigations and impose penalties on those corporations found guilty.
- The FAC will not impose penalties on corporations if domestic authorities have already penalized it for the same violation unless the penalties are deemed insufficient, and impose additional ones if neccessary [sic].
- Nothing in this proposal prevents member nations from having stricter regulations than those required by this proposal.
