FTC Declares Bloggers Must Disclose Paid Endorsements
The Federal Trade Commission issued new guidelines Oct. 9 that
require bloggers receiving cash or an in-kind payment for product
reviews to disclose the connections they share with the seller of the
product or service. The rules are part of a wider effort by the FTC to
redefine disclosure requirements between endorsers and advertisers.
The rule changes are the first in almost 30 years to address the
relationship between reviewers or endorsers of a product and the first
to include bloggers. The
revised Guides Concerning
the Use of Endorsements and Testimonials in Advertising, also add new
examples to illustrate the long standing
principle that "material connections" (sometimes payments or free
products) between advertisers and endorsers -- connections that
consumers would not expect -- must be disclosed.
"The revised guides specify
that while decisions will be reached on a case-by-case basis, the post
of a blogger who receives cash or in-kind payment to review a product
is considered an endorsement," The FTC said in a statement. "Thus, bloggers who make an endorsement
must disclose the material connections they share with the seller of
the product or service."
The FTC did not specify the manner in which bloggers must make their material connections available to readers. The rules take effect Dec. 1 and penalties include a possible $11,000 per violation.