UK Office of Fair Trading: paid tweets and blog posts must be identified

Posted by Siobhan Doherty - 4.21pm - 20 January 2011

In a precedent-setting ruling, the UK's Office of Fair Trading (OFT) has held that online advertising and marketing practices which fail to identify paid comments and promotions are deceptive under the UK's fair trading laws.

In December 2010, the OFT found that Handpicked Media, the operator of a commercial blogging network across a variety of sectors, had published content on website blogs and microblogs (eg Twitter) which promoted the activities of Handpicked Media's clients without identifying to consumers in a sufficiently clear manner that the promotions had been paid for.

In particular, the OFT ruled that Handpicked Media had contravened the UK's Consumer Protection from Unfair Trading Regulations 2008 (Regulations) by engaging in practices which constituted: 

• misleading omissions, as Handpicked Media had failed to disclose (or disclosed in an unclear or untimely manner) that promotions were paid for, which had the potential to influence consumers' purchasing decisions; and 
• unfair commercial practices, as Handpicked Media had promoted products using editorial content without making it clear in the content or by images or sounds that the promotion was sponsored.

The OFT required Handpicked Media to give undertakings not to engage in promotional activity unless its bloggers prominently disclosed that promotions were paid for or otherwise remunerated. Handpicked Media cooperated with the OFT throughout the five month investigation.

Following on from the Handpicked Media decision, the OFT has said that it is not its place to specify particular language to be used by traders to comply with the Regulations. The OFT has confirmed, however, that disclosures should clearly identify, in a manner prominently displayed with the editorial content such that it would be unavoidable to the average consumer, that the promotion has been paid for. In relation to platforms such as Twitter, which limit messages to 140 characters, the OFT has indicated that the general disclosure principle still applies and that hashtags could be used to identify paid for tweets.

So how might this decision affect Australian businesses?

The Regulations apply to any trader in the UK (including foreign businesses with a presence in the UK) involved in the promotion, sale or supply of products to or from consumers. Equivalent laws apply to traders in other EU countries.

The position is not as clear where a business based outside the EU deals with consumers within the EU (eg over the internet), but as the Regulations seek to protect the general public there is a risk that they might be held to apply in that situation and therefore specific advice should be obtained.

Partner: Michael Whalley