Page 96 - Foundations of Marketing

The Marketing Environment, Social Responsibility, and Ethics | Chapter 3 63

Table 3.2 Major Federal Laws Affecting Marketing Decisions ( continued )

Act (Date Enacted) Purpose
Consumer protection legislation

Do Not Call Directs the Federal Communications Commission (FCC) and the FTC to coordinate so that their
Implementation rules are consistent regarding telemarketing call practices, including the Do Not Call Registry
Act (2003) and other lists, as well as call abandonment.

Credit Card Act (2009) Implements strict rules on credit card companies regarding topics such as issuing credit to
youths, terms disclosure, interest rates, and fees.

Dodd-Frank Wall Street Promotes fi nancial reform to increase accountability and transparency in the fi nancial industry,
Reform and Consumer protects consumers from deceptive fi nancial practices, and established the Bureau of Consumer
Protection Act (2010) Financial Protection.

Trademark and copyright protection legislation
Lanham Act (1946) Provides protections and regulation of brand names, brand marks, trade names, and trademarks.

Trademark Law Revision Amends the Lanham Act to allow brands not yet introduced to be protected through registration
Act (1988) with the Patent and Trademark Office.

Federal Trademark Gives trademark owners the right to protect trademarks and requires relinquishment of names
Dilution Act (1995) that match or parallel existing trademarks.

Digital Millennium Refi nes copyright laws to protect digital versions of copyrighted materials, including music
Copyright Act (1998) and movies.
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Regulatory Agencies

Federal regulatory agencies influence many marketing activities, including product develop-
ment, pricing, packaging, advertising, personal selling, and distribution. Usually, these bodies
have the power to enforce specific laws, as well as some discretion in establishing operating
rules and regulations to guide certain types of industry practices.
Of all the federal regulatory units, the Federal Trade Commission (FTC) influences mar-
keting activities most. Although the FTC regulates a variety of business practices, it allocates
considerable resources to curbing false advertising, misleading pricing, and deceptive packag-
ing and labeling. When it receives a complaint or otherwise has reason to believe that a firm
is violating a law, the commission issues a complaint stating that the business is in violation.
If a company continues the questionable practice, the FTC can issue a cease-and-desist order
demanding that the business stop doing whatever caused the complaint. The firm can appeal
to the federal courts to have the order rescinded. However, the FTC can seek civil penalties
in court, up to a maximum penalty of $ 10,000 a day for each infraction if a cease-and-desist
order is violated. The FTC also assists businesses in complying with laws and files lawsuits
against those engaging in deceptive marketing practices. For instance, the FTC investigated
whether Google had engaged in anticompetitive practices by unfairly favoring its own prod-
ucts while making it more difficult for competing products to be displayed prominently in its
search results.
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Unlike the FTC, other regulatory units are limited to dealing with specific products or
Federal Trade Commission
business activities. For example, the Food and Drug Administration (FDA) enforces regula-
(FTC) An agency that regulates
tions prohibiting the sale and distribution of adulterated, misbranded, or hazardous food and
a variety of business practices
drug products. The Consumer Product Safety Commission (CPSC) ensures compliance with and curbs false advertising,
the Consumer Product Safety Act and protects the public from unreasonable risk of injury misleading pricing, and decep-
from any consumer product not covered by other regulatory agencies. tive packaging and labeling

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