Consumers readily associate Red Bull energy drink with the slogan “Red Bull Gives You Wings,” but most consumers do not actually believe they will grow wings after drinking a Red Bull energy drink. This type of clearly exaggerated advertising language normally would not fall within the scope of false advertising regulated and punishable under Article 21 of Taiwan’s Fair Trade Act. However, the distinction between commercial puffery and false advertising is not always so clear. The difficulty in drawing this line can particularly be seen in the case of “superlative claims” in advertising. This article will analyze the definitions of and distinction between commercial puffery and misleading advertising from the perspective of superlative claims.

In intensely competitive markets, in order to stand out from other competitors, companies often use exaggerated advertising language, such as “number one,” “champion,” “the maximum,” “the biggest,” and other superlative claims to catch the attention of consumers and increase the visibility of their products. However, is such advertising language used truthfully? Can consumers trust these advertising claims and rely on them to make transactions? These are significant questions, and that is why Taiwan’s Fair Trade Commission (FTC)—in Table 2 “Examples of Types of False or Misleading Representation or Symbol Cases” (hereinafter, the “Case Types”) of the FTC Disposal Directions (Guidelines) on Handling Cases Governed by Article 21 of the Fair Trade Act—specifically lists, as one form of false advertising, the use in advertisements of superlative claims linked to objective statements, but without objective supporting data such as sales figures or opinion surveys (Case Type No. 29). Accordingly, advertisers using superlative claims in their advertisements must be especially attentive to avoid crossing the red line and being sanctioned or punished by the FTC.

According to the description of Case Type No. 29 and past decisions by the FTC, the use of superlative words in advertising does not automatically constitute false advertising. Whether false advertising is constituted can be analyzed through a two-step test: the first step is to determine whether the content of the advertising claim corresponds to subjective feelings or objective facts; the second step is to determine whether the wording of the advertisement is misleading to consumers and likely to cause them to transact out of a mistaken belief.

First step: subjective feelings vs. objective facts

As the first step, it is necessary to determine whether the superlative words are linked to subjective feelings or objective facts.

If it is the former, the FTC tends to consider such advertising content as a subjective and reasonable commercial exaggeration or customary sales technique that by its nature is not objectively provable, and so does not demand proof by objective supporting data. A review of FTC decisions in past cases shows that common superlative words used to describe subjective feelings include “best,” “optimal,” “greatest,” “strongest,” etc. (in Chinese characters). For example, in the Rou-Shu (literally, “soft and comfortable”) toilet paper case, the FTC determined that its claim of “the best, greatest, highest quality tissue” was a subjective determination.[1] In the Smart Stock case, it was determined that its claim of “strongest function” was a self-aggrandizing boastful advertisement.[2] This type of “boastful/self-praising” subjective commercial statement is considered by the FTC to be subjective superlative language that does not and cannot require provision of objective evidence because it involves personal subjective feelings and lacks definite standards for proof.

If the superlative words are linked to objective statements, however, because such statements can be supported by objective proof and checked for truth or falseness, the FTC generally requires advertisers to provide objective evidence to prove such advertising claims are true. In practice, superlative words commonly considered by the FTC to be used to express objective facts include: “the number one,” “the champion,” “the only,” “the fastest,” “the longest,” “the highest,” “the most,” “the largest,” etc. (in Chinese characters).

Although dividing superlative terms into those expressing either subjective feelings or objective statements may initially seem straightforward enough, in many cases it is necessary to consider the overall context of the advertising message to make a precise judgment. For example, in the Daikin Air Conditioner case, the FTC determined that the Japanese term “ichiban” not only had the meaning of “number one,” but also the meaning of “the best”, and was a subjective recommendation.[3] In the La Jolla Group International Co., Ltd. case, in which the company claimed that its product was “the number one titanium-germanium luxury product in the United States,” the FTC determined that the use of the term “number one” in that case was merely self-puffery because the advertiser did not link the superlative term to any objective information.[4] Therefore, in determining whether the use of superlative words in an advertisement crosses the red line of false advertising, it is necessary to carefully consider the relevant advertising content, context, and expression imparted to consumers, and confirm what the superlative word is linked to in the advertising content, rather than simply dividing words in advertisements into the opposing categories of subjective feelings or objective statements based on the common definitions of the words.

Second step: whether the advertising content is false or misleading

Following on the first step of the test for analyzing the legality of superlative claims, if the advertisement is of the subjective commercial self-puffery type, the FTC usually finds that general consumers can understand the advertising language as simply a hyperbolic or exaggerated tactic to attract buyers and does not constitute content of the product. Thus, consumers will not be misled, and the FTC will typically not impose punishment for such subjective puffery advertising language.

However, if the advertisement involves objective factual advertising content, the FTC will further require the advertiser to provide objective evidence to prove that the objective statements in the advertising content are consistent with the facts. If the claims made in an advertisement are not in line with the facts, the FTC will further judge whether the false or misleading claim would likely cause consumers to transact on the basis of a mistaken belief.

Generally speaking, if the advertiser presents evidence of superlative claims but its examination/investigation report does not cover all competing businesses; or the sources, methods, or institutions from which it obtained the basic data examined/investigated are not reliable; or if too long a time had passed between the examination/investigation and the time the advertisement was released, the FTC tends to find that such evidence is inadequate proof of the objective facts mentioned in the advertisement and the advertising claims are thus false or misleading. In such cases, the advertiser may be found in violation of Article 21 of the Fair Trade Act and sanctioned or punished accordingly. For example, Taiwan Star Telecom claimed in its advertising that it was the champion of mobile Internet speed on New Year’s Eve for three consecutive years, but the FTC found that the data it provided to support the claim was incomplete and the benchmark Internet speed it used was determined in testing done by Taiwan Star Telecom itself, the standard of which deviated from that used in test methods by other telecommunication companies to compare Internet speed. On these grounds, the FTC found Taiwan Star Telecom to be in violation of the Fair Trade Act.[5] From this case, it can be seen that if the content of a superlative advertising claim involves statements of objective facts, the advertiser must take particular care, and the evidence it uses to support the claim must be sufficiently objective, fair, and complete. Otherwise, the evidence might not be accepted by the FTC and the advertisement may consequently be determined to be false or misleading.

It bears particular note, however, that what the Fair Trade Act contemplates is whether the behavior of a business will affect the overall fair trade order. In cases of false or misleading advertising, the FTC and the courts will further determine whether the discrepancy between an advertisement and the facts exceeds what is acceptable to the general or relevant public, and is likely to cause mistaken understanding or decisions. Even if the content of a superlative advertising claim is a statement of objective facts that is not supported by objective evidence, if “the difference between the advertised and actual product can be accepted by consumers” or “the content of the advertisement does not affect consumers’ decision-making considerations,” the FTC or the court may still determine that the content of the advertisement does not violate Article 21 of the Fair Trade Act. As an example, a Taiwanese construction company advertised a project as “Taiwan’s first building that can breathe,” although it was not actually the first building in Taiwan with a ventilation function. However, the court found that the patented ventilation method used in the project was indeed the first of its kind in Taiwan, and the difference between the advertisement and the actual condition of the building was within an acceptable range. Further, whether the building was the first one to have ventilation was not found to be a primary factor in consumers’ decision whether to transact, nor to affect the safety of the transaction. Therefore, the advertisement was determined not in violation of Article 21 of the Fair Trade Act.[6]

Conclusion

If an advertiser wishes to attract consumer attention through an advertisement containing superlative language, it is advisable to pay special attention to whether the content is subjective feelings of exaggeration or puffery or statements of objective fact. If it is the latter, before releasing the advertisement, it is necessary to confirm whether the advertising claims are supported by objective, reasonable, and fair objective evidence, and to ensure that the claims will not mislead consumers or cause them to form mistaken beliefs. In this way, effective advertising can be achieved without violating the law.

This is a translation of the original article in Chinese, which can be found here. Translation by Niki Chen and Paul Cox.

If you would like to know more about advertising regulations, please feel free to contact Ling-ying Hsu at lhsu@winklerpartners.com.

Written December 20, 2022 By Ling-ying Hsu, Helen Chen.

Translated on January 4, 2023 By Niki Chen and Paul Cox

[1] Fair Trade Commission Decision No. Gong-Chu-099119 dated October 25, 2010.

[2] Fair Trade Commission Decision No. Gong-Chu-100269 dated December 29, 2011.

[3] Fair Trade Commission Decision No. Gong-Chu-099011 dated January 28, 2010.

[4] Fair Trade Commission Decision No. Gong-Chu-100097 dated June 8, 2011.

[5] Fair Trade Commission Decision No. Gong-Chu-107012 dated March 2, 2018.

[6] Fair Trade Commission Decision No. Gong-Chu-097015 dated January 31, 2008, and Taipei High Administrative Court Judgment No. 2388 dated February 17, 2009.