Paid to Post

Posted by on Sep 29, 2015 in Blog, Featured, Legal Services, Speaking Engagements | 0 comments

Paid to Post

by Kayte Lewis & Chris Chow
Chris Chow Creative Lawyers

Way back in 1999, before the bloggersphere, some of you may remember the infamous outcry about “cash for comment”.  In short, (those of you under 25 can see this as a history lesson) it was realised that talk back radio shock jocks Jones and Laws were being paid to make favourable comments about products and services on air. The payments were in cash but also in provision of hospitality services. It came up again in 2004 and there was an inquiry and sizeable fines were imposed by the Federal Court as the payments were not disclosed.

In the new world of social media, its almost a given that the ‘insta-famous’ are being given clothes and makeup in return for blogging about them or taking photos of themselves wearing them – yet disclosures of the commercial nature of these transactions seem to be few and far between.

A recent case in the US has brought the issue back into the news.  New York based ‘Lord and Taylor’ have been found to have breached Federal Trade Commissions guidelines by not disclosing they provided dresses and an undisclosed amount of compensation to high profile fashion bloggers.  The FTC in America required that when people are paid to post, they must disclose this. Australia also demands that there be transparent commercial relationships.  Compliance with these requirements can now clearly be seen on Facebook, where ads are now tagged as ‘sponsored’, and it’s possible to create the same level of transparency on Instagram with #tags like #sponsoredpost, #paid, or #ad.

The Australian Competition and Consumer Commission (ACCC) released guidelines in November 2013 providing governing principles addressing this change in consumer behaviour, acknowledging that consumers have developed a reliance on reviews and stating that reviews should have integrity, be transparent and not misleading.

The ACCC have taken action against misleading or fake online post since 2011 when Citymove were fined $6600 for infringing policy with fake online reviews. ACCC continue to do so and earlier this year took action against one company (Europcar) for posting misleading and fake testimonials on their website – see https://www.accc.gov.au/media-release/accc-takes-action-against-europcar-for-alleged-unfair-contract-terms-and-misleading-conduct.

Social media is a powerful advertising space and the ACCC has it in its sites, so we envisage more action is likely to follow.  If your business relies on the bloggerspere, or you’re a blogger, make sure you know your responsibilities and understand that commercial relationships must be disclosed.

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