FTC Updates Social Media & Online Advertising Guidelines – Disavowing Settled Practices and Imposing Tighter Disclosure Requirements for Digital Advertising


The Federal Trade Commission (FTC) recently released new guidance for making effective disclosures in digital advertising, proposing stricter requirements that should lead all those participating in digital advertising to re-examine their current practices and procedures. Released on March 12, 2013, the new FTC .com Disclosures guidance updates its original May 2000 Dot Com Disclosures that provided guidance for making disclosures in the online world. The FTC’s recent update attempts to account for the current mobile advertising environment, the rise of social media marketing, and experience under the original disclosure guidance. The old guidance merely allowed for “proximity” of disclosures – that is, disclosures that were “near, and when possible, on the same screen.” The new guidance places heightened emphasis on disclosures being clear and conspicuous to consumers across all platforms. The newly announced principle is that disclosures should be “as close as possible,” with short form disclosures such as hyperlinks or hashtags permitted only when their meaning is understood by consumers.

This change is potentially significant, and the new .com Disclosures guidance should be carefully understood by those participating in digital advertising. For example, under the new guidance, the FTC advises that “#Sponsored” likely is acceptable in a sponsored tweet, but that “#spon” likely is not acceptable – and is deceptive – because consumers might not understand what “#spon” means. The new guidance also addresses at length the challenges presented by advertisements on mobile devices, taking the position that if a platform is not capable of displaying clear and conspicuous disclosures, then the platform should not be used for digital advertising. On this basis, the FTC advises against using Flash media for disclosures since its use is not yet universal.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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