Influencer Marketing – Are Consumers Protected?

by , on Apr 02, 2024 07:56:52 AM

Protection for Consumers from Sponsored Posts on Social Media

In the realm of business, advertising holds paramount importance, serving as a vital tool for traders to convey information about their products to customers and consumers. With the advent of technology and social media, advertising has evolved into various forms, with companies increasingly leveraging influencers to promote their products.

This shift is evident in Malta, prompting an examination of influencer marketing and its implications under Maltese law.

Is the term ‘influencer’ defined under Maltese law?

The term ‘influencer’ lacks a specific definition in Maltese law. However, according to the Consumer Affairs Act, a ‘trader’ encompasses individuals or entities conducting business activities. Consequently, influencers often fall within this definition.

Influencers, whether celebrities, bloggers, or individuals with substantial social media followings, are perceived as authorities on product recommendations. However, a significant concern arises from influencers promoting products without transparently disclosing sponsorship arrangements.

Given the inherent power imbalance between consumers and traders, legal safeguards aim to protect consumers from unfair commercial practices. The Consumer Affairs Act and Directive 2005/29 prohibit traders from misleading consumers or exerting undue pressure on their purchasing decisions.

To comply with these regulations, influencers must ensure transparency in their commercial endeavors, clearly indicating sponsored content to prevent consumer deception and legal repercussions.

What is the ‘Influencer Legal Hub’?

Initiatives at the European level, such as proposed EU regulations and the establishment of the “Influencer Legal Hub” by the European Commission, demonstrate a proactive approach to address issues surrounding influencer advertising.

To avoid misleading consumers, influencers must refrain from disguised advertising, which blends commercial messages with non-commercial content. Clear disclosure of sponsored content is essential, utilizing appropriate hashtags or labels to inform consumers of the commercial nature of the post.

While existing legislation provides a framework for consumer protection, effective enforcement and the dissemination of clear disclosure guidelines are necessary. Regulatory authorities, such as the Malta Competition and Consumer Affairs Authority, should provide guidance to educate both influencers and the public on proper disclosure practices.

Ultimately, the goal is to ensure transparency in influencer marketing, safeguarding consumer interests and upholding the integrity of commercial practices.