Summary
- Businesses must disclose all commercial relationships with influencers, including gifted products, to avoid breaching the Australian Consumer Law (ACL).
- Editing reviews to remove negative feedback or systematically deleting negative reviews may constitute misleading or deceptive conduct under the ACL.
- Sponsored content must be clearly identified as such, even when reposted on a business’ own channels.
- This article explains the legal obligations under the ACL that apply to Australian businesses engaging in influencer marketing and online reviews, serving as a practical guide for business owners.
- The content has been prepared by LegalVision, a commercial law firm that specialises in advising clients on Australian consumer law and digital marketing compliance.
Tips for Businesses
Always disclose commercial relationships with influencers, including gifted products. Never edit reviews to remove negative feedback. Ensure sponsored content is clearly labelled, even when reshared. Avoid systematically deleting negative reviews. Follow the AANA Code of Ethics and AiMCO Code of Practice, and monitor ACCC guideline updates.
Influencer marketing lets businesses pay or reward individuals to promote their products and services on social media. Australian Consumer Law governs how businesses must handle these arrangements, requiring transparency and honesty in all advertising. Recently, the Australian Competition and Consumer Commission (ACCC) issued $39,600 in penalties to an online retailer for misleading influencer reviews. This article serves as a timely reminder of how the ACL applies to the digital world and online advertising.
Do Not Hide Commercial Relationships
A common misconception is that a commercial relationship only exists when cash changes hands. Under the ACL, providing an influencer with free products or services in exchange for a review is considered a form of payment.
Businesses must not instruct influencers to conceal these arrangements. For example, asking an influencer to avoid mentioning that a product was “free”, “sponsored”, or “gifted” is highly likely to mislead consumers.
Do Mandate Clear Disclosures
Transparency is essential. If you work with an influencer to create content, whether you pay them or give them free products worth $50 to $400, it must be clear to viewers that it is a paid partnership.
Ensure that influencers you work with clearly disclose the partnership in their posts. Furthermore, if your business shares or reposts that content on your own channels, you must also ensure the disclosure remains clear.
Continue reading this article below the formCall 1300 544 755 for urgent assistance.
Otherwise, complete this form, and we will contact you within one business day.
Do Not Edit Reviews to Remove Negative Content
It can be tempting to polish a review before sharing it with your audience, but substantively editing a review to remove negative feedback can breach the ACL.
For example, if an influencer says a product was “a bit fiddly” or “confusing” but still liked the result, you cannot edit out those negative comments. Cutting the video to only show that they were “happy with the product” changes the meaning and is misleading.
Do Present the Genuine Overall Impression
When a business posts a review on social media, consumers reasonably assume that the post genuinely reflects the reviewer’s actual experience. If you are sharing a review, it must reflect the overall impression of the original content.
Misleading edits can cause consumers to purchase products they otherwise would not have bought had they seen the complete, unedited review. Always ensure that the testimonials you use are accurate, complete, and representative of the reviewer’s true opinion.
Reviews on Your Own Platforms
If you operate your own website or social media pages, you generally have discretion over what content appears there. However, if you systematically delete negative reviews while keeping positive ones, you could be creating a misleading overall impression of your products or services. This selective curation may represent to consumers that your products are better received than they actually are, which could constitute misleading or deceptive conduct under the ACL.
Do Follow Industry Codes of Practice
In addition to the strict legal obligations under the ACL, businesses and influencers should adhere to industry-led practices and guidelines. These provide a reliable standard for advertising in Australia:
- The Australian Association of National Advertisers (AANA) Code of Ethics: Requires that advertising is clearly distinguishable as such to the relevant audience.
- The Australian Influencer Marketing Council (AiMCO) Code of Practice: Outlines good practice for companies and influencers engaging in influencer marketing, including detailed guidance on how to properly disclose advertisements.
The ACCC is also set to release specific guidelines for influencers that will clearly outline their obligations under the ACL. Staying up to date with these guidelines and ensuring your marketing practices are transparent will help maintain consumer trust and ensure compliance with Australian law.
Starting or managing an online and ecommerce business? Download this free guide to learn the key legal essentials, from contracts and employment to data protection and brand protection.
Key Takeaways
Businesses must disclose all commercial relationships with influencers, including gifted products. Sponsored content must be clearly identified, even when reposted on your own channels. Never edit reviews to remove negative feedback, as this may breach the ACL. Any testimonial you publish must reflect the reviewer’s genuine overall experience. Systematically deleting negative reviews while keeping positive ones may constitute misleading conduct. Follow the AANA Code of Ethics and AiMCO Code of Practice for compliance guidance. Monitor ACCC developments, as specific influencer guidelines are expected to be released soon.
LegalVision provides ongoing legal support for businesses through our fixed-fee legal membership. Our experienced eCommerce lawyers help businesses manage contracts, employment law, disputes, intellectual property, and more, with unlimited access to specialist lawyers for a fixed monthly fee. To learn more about LegalVision’s legal membership, call 1300 544 755 or visit our membership page.
Frequently Asked Questions
Yes, the ACL applies to influencer marketing across all social media platforms, including Instagram, TikTok, and YouTube.
Yes, businesses can face penalties if they instruct or encourage influencers to make misleading claims or conceal commercial relationships.
Influencers should use clear hashtags like #ad, #sponsored, or #gifted to disclose commercial relationships transparently.
Deleting one negative review is unlikely to breach the ACL. However, systematically removing negative reviews while keeping positive ones may constitute misleading conduct.
We appreciate your feedback – your submission has been successfully received.
