How is the influencer marketing industry regulated?

Co-written with Myriam Roche, founder of “Les Gens d’Internet”

“Influencer marketing is a bit of a Wild West”. “The work of influencers is not really supervised”. These statements can come up at any time during a conversation between people who don’t work in the industry. Because no, on social media, the law of the strongest does not reign. There are rules to respect and they also concern content creators and advertisers.

The work of influencers is carefully monitored by government and legal services. Is there a specific legal framework for each country? What are the rules to respect? How will this framework evolve? How to talk about subjects like alcohol or online games on social media? What about child influencers?

With this article, we propose you to answer all these questions to help you to see more clearly.

The government’s approach to the regulation of influencers

In Europe, the European Union has chosen to better regulate online communication. Which laws have just been adopted?

The European Union’s supervision of influencers

The job of content creator was born more than ten years ago. On their blogs and then on their social networks, these professionals earn their living by creating partnerships with brands. The brands partner with them to reach a large audience and reach an objective (awareness, sales, brand image…). But all these activities lacked until now an identical legal framework in all European countries.

Since 2020, the European Union has been working on legislation to better regulate the activities of digital giants, companies and users. On July 5, 2022, two laws, the Digital Services Act and the Digital Markets Act were adopted by the European Parliament. They aim to fight against illegal content (racist attacks, child pornography, misinformation, sale of drugs or counterfeits …), to make online communications more transparent, to reduce misinformation or to help small European companies to make a place.

To implement these directives, a “digital services coordinator” will be appointed by each Member State. They will come together in a “European Digital Services Committee” to monitor whether the various actors follow the laws. These coordinators will be able to impose penalties and sanctions.

The texts will be applied from January 1, 2024. Platforms and search engines will be concerned from 2023.

The influence marketing legal framework per country

Before the adoption of these two European texts, each country has thought of a legal framework. Here is an overview of the regulations that have been issued, their applications and future work. 

Although the work carried out differs from one country to another, one rule is the same everywhere. When content creators make a paid partnership, influencers are required to specify, in their text accompanying their publication, one of the following words: “ad”, “advertising”, “sponsored” or “ad” if it is an English-speaking country, preceded by a hashtag. This is a clear way to warn the user.

Belgium

In Belgium, Eva De Bleeker, Secretary of State for Budget and Consumer Protection in the Belgian government, specified in April 2022 some rules to follow for content creators. A guide has been created to list all the right things to do.

https://twitter.com/SPFEconomie/status/1518545353812762624 

To ensure that these guidelines are properly applied, the federal service of economy, FPS Economy, is responsible for monitoring, reminding and sanctioning.

The Belgian government details all obligations towards influencers in this article:

https://economie.fgov.be/fr/themes/ventes/publicite/vous-etes-createur-de-contenu 

As a next step, a label was unveiled by the Belgian e-commerce federation BeCommerce on November 25. The objective is to facilitate the identification of influencer profiles that respect the rules shared by the FPS Economy. With this tool, Belgium wishes above all to fight against fraudulent advertising. Its deployment should be planned during 2023.

France

In 2023, in France, the government and some deputies are working on a clearer legal framework for the profession of content creators. Several actions have already been taken to achieve this:

  • On November 4, the deputy of Europe écologie les verts, Aurélien Taché filed a bill to better frame the partnerships between influencers and advertisers. The text can be read here.

https://twitter.com/Aurelientache/status/1588465665123713024 

  • On December 9th, the Ministry of Economy received several influencer agencies to better understand how the sector is structured. These actors shared their proposals in order to make the environment evolve.
  • On December 12, the two deputies of La France Insoumise François Piquemal and Nadège Abomangoli submitted a text to fight against online scams and do prevention.
  • On January 3, a public consultation was launched on the platform make.org, accessible to all until January 31. All those who wish to give their opinion on the best way to regulate the practices of influencers, can visit the site and make their proposals on the 11 measures concerning the influencer marketing sector.

https://twitter.com/FiAssemblee/status/1602305286488068098

The various initiatives launched in France and the opening of this public consultation show that we are moving in the right direction. According to Cathy Pill,

Co-founder of Stellar, “It is crucial to actively participate and speak out because we can positively impact our industry and collaborate with all its players to create a healthy ecosystem for everyone”.

The United States

In the United States, regulation of influence practices is overseen by the Federal Trade Commission (FTC). This is an independent agency of the government that monitors and enforces compliance. The agency has the ability to impose sanctions, as it did with Facebook in 2019

The FTC has released this document for influencers to clarify their duties. In particular, it states that they must not promote dangerous or untested products or that paid partnerships must be clearly specified.

The United States, already well advanced in the influence sector, wishes to fight more in the coming months against the propagation of false information and against fraudulent advertising.

Government agencies that monitor the work of influencers

Each country has been working on this issue. In order to implement the regulations, the governmental services are in charge of making sure that the directives are properly followed.

In detail, here are the different entities per country that manage this part:

 

Sanctions have already been pronounced. In France in 2021, it was the reality TV star Nabilla who was fined 20,000 euros for deceptive business practices. In 2018, she had promoted on Snapchat stock market products without specifying that she had been paid to do so.

Moreover, some countries are only at the very beginning of the debate, as the profession of content creator is more recent. In Luxembourg for example, no law is explicitly dedicated to the profession of influencers. However, they have to comply with all the legislation related to advertising: the ALIA (Autorité Luxembourgeoise Indépendante de l’Audiovisuel).

Institutions that help the government regulate the sector

Non-governmental organizations can support the government’s work. In France, for example, the Autorité de régulation professionnelle de la publicité (ARPP) plays an advisory role for advertisers and agencies. The team has worked on an ethical influence charter to better supervise influencers’ speeches.

ARRP has also come up with the Ethical Influence Certificate, a test that influencers have the opportunity to take before being issued a certificate. 250 French profiles have had it since September 2021. Companies such as Club Med or the BEL group only work with creators who have obtained it. Each European country has its own version of the ARPP. In Italy, it is the Istituto dell’Autodisciplina Pubblicitaria which is in charge.

The ARPP cannot impose sanctions. It plays an advisory role via its in-house lawyers, with companies, before their advertising campaign is broadcast. 

Beyond paid publications, what are the obligations online when talking about products like alcohol or sports betting? Do child influencers also have a specific legal framework to respect?

Special cases: child influencers, online gambling and alcohol

On social media, we are free to talk about anything. Really? In reality, when it comes to more sensitive topics in paid collaborations, there are rules to follow. For over 10 years, there have been plenty of exceptions.

Child influencers

Very young users are successfully working with brands. The best known example is 10-year-old YouTuber Ryan Kaji, who ranks in the top 3 highest paid videographers in the world every year according to Forbes.

Shooting, putting ourselves on stage, showing the camera the products we are offered… is like a real job. So, when we are only ten years old, what are the rules concerning us? The laws are still unclear in many countries. France has just ruled on this subject. Child influencers under 16 years old are in the same category as models. When a brand requests them for a collaboration, several documents are now required:

  • a prior individual authorization issued by the administration is required,
  • a prior declaration of their legal representatives to the administration.

 

All the money received from this work is blocked in an account until the child reaches the age of majority.

In Belgium, the deputy Leen Dierick, has filed a motion for a law aiming at regulating young influencers. With this text, she wants to better define the working hours and remuneration to avoid abuses.

In the United States, the issue also needs to be addressed. According to Wired magazine, the landmark Fair Labor Standards Act of 1938, which prevents “excessive child labor,” has yet to be amended to apply to child influencers.

Alcohol brands

When the good days arrive, the pictures of aperitifs here and there multiply on social media. However, communicating for an alcohol brand requires some knowledge of legal matters. 

In France, advertising in this sector is governed by the Evin law. In the United States, brands are committed to respecting the Distilled Spirits Council of the United States, the Beer Institute or the Wine Institute.

All have agreed on the same mechanism: advertising must not encourage people under 18 (21 in the United States) to drink and must also avoid encouraging any dependency. The phrase “alcohol abuse is dangerous for your health” must be visible.

The United States goes one step further regarding social networks. The regulation specifies that if a communication about alcoholic beverages is made to an audience where there are more than 28.4% minors, it is not allowed. On social media, this can quickly become the case.

Online gambling

Online gambling is becoming more and more visible on social media. Once again, the sector is regulated by certain laws. Only online gaming or betting operators are authorized in France by the National Gaming Authority to advertise. When advertising of this type is carried out, it is important to avoid any addiction to games.

In Belgium, the subject is under discussion, as the law does not concern social networks. Prime Minister Alexander De Croo wants to see all advertising on this subject banned by 2024 on applications.

The other exceptions

The list of exceptions can quickly get longer, since we can also talk about advertising around drugs, the voice of doctors influencers or mention all the subjects related to ecology. It is important to keep in mind that for each sector, there are particularities on which it is necessary to inform oneself to avoid any deviation.

In addition to the legislation put in place by the governments and organizations of each country, social networks also have their own policies on this subject. For example, TikTok prohibits commercial content around alcohol.

So, what can you do when you are an advertiser to avoid being in the illegal? What are the best practices to keep in mind?

Tools and best practices to adopt on social networks

Beyond advertising agencies and regulations, the networks have also developed features to help content creators and brands collaborate in a transparent way. They complement the mentions “partnership”, “collaboration” or “ad” for English-speaking countries, specified under the creators’ content. This way, the user is notified in different ways and the information cannot escape him.

Instagram

Since 2017, Instagram has implemented a very practical tool for business and creative accounts. It is visible in the top right of some publications, just below the username: a “paid partnership” mention appears.

https://www.instagram.com/p/ClmB_twNq43/ 

The influencer must specify this mention with the tools developed by the application. To set it up on their side, you need to:

  • go to your account settings, go to the “Creator” tab, then “branded content”,
  • configure the mention “partnership with” to be able to use it, the registration is done in a few seconds. Once it is effective, you can use this feature on your content. A button is visible when you post a publication or a story.

TikTok

TikTok has also implemented a similar button. As a brand, you can also ask the content creators you collaborate with to activate it.

Post a video as usual, then:

  • once on the editing page where you can write the caption, click on “more options” at the bottom of the page,
  • you have three choices, go to “branded content and advertising”,
  • on the last page, select “branded content”.

https://www.tiktok.com/@canocassandra/video/7178263169356270854?is_from_webapp=1&sender_device=pc&web_id=7093100442331317765 

By specifying this option, the “paid” message will appear on the video, above the influencer’s profile name when using the app.

YouTube

Finally, YouTube has developed a similar tool. The mention “commercial communication” appears a few seconds at the very beginning of the video, which allows users to know that a product placement is made.

https://youtu.be/1ldFvs88nvE 

As a brand, it is possible for you to direct the video maker to make this mention visible. All the YouTuber has to do is check the box “This video contains a commercial communication such as a paid product placement, sponsorship or promotion” on the editing page of his content. The details of the collaboration can also appear more clearly in the caption. The creator has the possibility to indicate which brand he is collaborating with.

https://support.google.com/youtube/answer/154235?hl=fr 

In addition to specifying “partnership” on YouTube, the content creator is also required to state this clearly when highlighting the product in the video. Generally speaking, videographers have taken to introducing the sponsor’s arrival in this way: “today, this video was prepared with *brand name*”. On Twitch or even in podcasts, creators take the time to warn their audience when a product placement is made.

Good practices to adopt as a brand

As you’ve already understood, when collaborating with an influencer, the partnership must be written in black and white. If some creators don’t yet have the reflex to inform about it on all the publications concerned, brands can help them to improve their transparency towards their audience. They can :

  • give the right indications in the brief: it must be specified that in the caption or on the post, the mention “collaboration with” must be clearly visible. It is also in this document that it must be specified if the communication includes a particular legal aspect, as for alcohol or sports betting.
  • repeat it during calls and emails exchanged with the influencer.
  • ask again if the day of the publication the mention is not visible.

Why is it important to be aware of this information at the beginning of the collaboration? First, because it is a regulation to follow in the advertising industry. Secondly, to allow the influencer’s audience to understand that it is an advertisement and that it is the brand that wanted to work on the content with them.


The followers are precious and it is to them that the brand communicates a very precise message. In order to create a bond of trust, it is always good to be as transparent as possible. It can also be a way to show how proud the creator and the advertiser are to work together.

Influencer regulation to better shape the industry

In France, for example, all these points are present in the penal code with laws concerning each of these issues. In the years to come, the sector will have to structure itself on many other subjects.

In the Web3 era, with the growing adoption of cryptocurrencies, new regulations have emerged. In Europe, on October 5, 2022, the Council of the European Union approved the MiCA (Markets in Crypto-Assets) and TFR (Transfer of Funds Regulation) regulations. The aim is to provide a legal framework for brokers and platforms offering services related to crypto-assets. The first text is expected to come into effect as early as January 2024. Influencer marketing regulation is always on the move, as new topics are always emerging.

Beyond the legal side, there is also a moral aspect that the influencer sector must work on. What about those influencers who are ready to promote products without having tested them or without worrying about whether they will be received by their followers who ordered them? 

In the statements of many content creators, this ethical side is strongly emphasized. They regularly state their position, specify that the products have been tested and explain their desire to work only with brands that share the same values as them. Ethics in influence is also to be taken into account if we want to have a structured and transparent market at all levels.

Co-written with Myriam Roche, founder of “Les Gens d’Internet”

Take your influencer marketing to the next dimension