# FTC Compliance — Influencer Marketing Regulations

## FTC Endorsement Guides — Core Requirements

The Federal Trade Commission requires that **material connections** between endorsers and advertisers be **clearly and conspicuously disclosed**. A material connection exists when an influencer receives anything of value — payment, free products, affiliate commissions, or any other benefit — in exchange for an endorsement.

### Fundamental Rules
1. **Disclosure must be clear and conspicuous** — the average consumer must be able to notice and understand it
2. **Disclosure must be in the same medium as the endorsement** — a text disclosure for a video endorsement is insufficient
3. **Disclosure must be before or at the point of the endorsement** — not buried at the end
4. **The endorser must actually use the product** and express genuine opinions
5. **Claims must be truthful** — endorsers cannot make claims the advertiser couldn't make directly
6. **Both the brand and the influencer are liable** for non-compliant content

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## Platform-Specific Disclosure Rules

| Platform | Built-In Disclosure Tool | How to Use | Additional Requirements |
|----------|------------------------|------------|------------------------|
| **Instagram** | Paid Partnership label | Toggle in Advanced Settings > "Add Paid Partnership Label" | Must be used for all paid/gifted content; hashtag disclosure still recommended |
| **TikTok** | Branded Content toggle | Enable via "Content Disclosure" before posting | Must select "Promotional Content" — not just "Your Brand" |
| **YouTube** | Paid Promotion checkbox | Studio > Video Details > "This video contains paid promotion" | Verbal disclosure in video within first 30 seconds also required |
| **LinkedIn** | None native | Use text disclosure in post body | #ad or "Paid partnership with [Brand]" required in first two lines |
| **Facebook** | Branded Content tag | Use the branded content tool to tag the sponsoring brand | Works similarly to Instagram Paid Partnership |
| **Pinterest** | None native | Text disclosure on Pin description | "Sponsored by [Brand]" or #ad in Pin description |
| **Twitter/X** | None native | Text disclosure in tweet body | #ad within the tweet — not in a reply or thread |
| **Podcasts** | None native | Verbal disclosure at the beginning of the ad segment | "This episode is sponsored by..." before the endorsement |

---

## Disclosure Placement Requirements

### Where Disclosure MUST Appear

| Content Type | Acceptable Placement | Unacceptable Placement |
|-------------|---------------------|----------------------|
| **Static post** | First line of caption, before "See more" truncation | End of caption, buried in hashtag block |
| **Video** | Superimposed text in first 5 seconds + verbal mention | Only in video description, only at the end |
| **Story** | Superimposed text visible for full frame duration | Small text that blends with background |
| **Live stream** | Verbal disclosure at start and repeated every 15–20 minutes | Only at the very end of the stream |
| **Podcast** | Verbal at the top of the episode and before each ad read | Only in show notes |
| **Blog post** | Above the fold, before the endorsement content begins | Footer only, sidebar only |
| **Tweet** | Within the tweet body, not in a reply | As a reply to the original tweet |

### Accepted Disclosure Language
- **Strongest**: "Paid partnership with [Brand]" / "Sponsored by [Brand]"
- **Acceptable**: "#ad" / "#sponsored" / "Ad:" at the beginning of the post
- **Insufficient**: "#sp" / "#spon" / "#ambassador" / "#partner" (too ambiguous)
- **Unacceptable**: No disclosure / disclosure hidden / only "Thanks [Brand]"

---

## International Compliance Matrix

| Jurisdiction | Regulatory Body | Key Requirements | Penalties |
|-------------|----------------|------------------|-----------|
| **United States** | FTC (Federal Trade Commission) | Clear and conspicuous disclosure of material connections; endorsements must reflect honest opinions; both brand and influencer liable | Up to **$50,120 per violation** (adjusted annually); consent orders; injunctions |
| **United Kingdom** | ASA (Advertising Standards Authority) + CMA | All ads must be clearly identifiable; "#ad" required; CAP Code applies to social media | Referral to CMA for legal action; fines; platform-level enforcement; naming and shaming |
| **European Union** | UCPD (Unfair Commercial Practices Directive) + national authorities | Prohibits misleading omissions; commercial intent must be disclosed; varies by member state | Varies by country — fines up to **4% of annual turnover** in some jurisdictions |
| **Australia** | ACCC (Australian Competition & Consumer Commission) | Australian Consumer Law prohibits misleading or deceptive conduct; disclosure required for paid endorsements | Fines up to **AUD $10 million** per contravention for corporations |
| **Canada** | Competition Bureau + Ad Standards | Competition Act prohibits deceptive marketing; Ad Standards guidelines require disclosure | Fines up to **CAD $10 million** (first offense); **$15 million** (subsequent) |
| **France** | ARPP + DGCCRF | "Publicité" or "Partenariat" labels required; influencer law (2023) mandates registration for large creators | Fines up to **EUR $300,000** and up to **2 years imprisonment** for severe cases |
| **Germany** | Landesmedienanstalten | Interstate Media Treaty requires clear ad labeling; "Werbung" or "Anzeige" required | Fines vary by state; up to **EUR $500,000** |
| **Brazil** | CONAR + CDC | Consumer Defense Code requires transparency; CONAR guidelines for advertising identification | Fines, content removal orders, public warnings |

### Multi-Market Campaign Compliance Checklist
- [ ] Identify all markets where content will be viewable (not just where creator is based)
- [ ] Apply the **strictest applicable standard** when content reaches multiple jurisdictions
- [ ] Include localized disclosure language where required (e.g., "Werbung" for Germany)
- [ ] Verify platform disclosure tools are activated for each market
- [ ] Document compliance review in campaign records

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## Contract Compliance Clause Templates

### Standard FTC Compliance Clause
> Creator agrees to comply with all applicable advertising disclosure laws, including the FTC Endorsement Guides (16 CFR Part 255). Creator shall clearly and conspicuously disclose the material connection with Brand in all sponsored content using language approved by Brand, including but not limited to the platform's native branded content tools and the hashtag #ad. Failure to comply may result in termination of this agreement and forfeiture of unpaid compensation.

### Enhanced Compliance Clause (For Regulated Industries)
> Creator shall submit all content for pre-publication legal review. Creator warrants that all claims made regarding the Product are truthful, substantiated, and reflect Creator's genuine experience. Creator shall not make health claims, efficacy claims, or comparative claims not expressly approved in writing by Brand. Creator acknowledges that violations of advertising regulations may result in personal liability and agrees to indemnify Brand for any fines or penalties resulting from Creator's non-compliance.

### International Compliance Addendum
> For content distributed in or accessible to audiences in the territories listed in Schedule A, Creator shall comply with the advertising disclosure requirements of each jurisdiction, including without limitation: [list applicable regulations]. Brand will provide jurisdiction-specific disclosure guidelines, and Creator shall implement these guidelines for all content viewable in covered territories.

---

## Common Violations & Penalties

| Violation | Description | Risk Level | Typical Consequence |
|-----------|-------------|------------|-------------------|
| **No disclosure** | Sponsored content posted with zero disclosure | Critical | FTC warning letter; $50,120/violation fine |
| **Buried disclosure** | #ad hidden in hashtag block or below the fold | High | FTC enforcement action; platform penalties |
| **Ambiguous disclosure** | Using #partner, #collab, or #ambassador alone | Medium | Warning letter; required corrective disclosure |
| **Wrong medium** | Text-only disclosure for video content | Medium | Required re-posting with proper disclosure |
| **Missing material terms** | Failing to disclose free product, affiliate relationship | High | Enforcement action against both brand and creator |
| **False claims** | Endorsing results the creator did not actually experience | Critical | Litigation; injunctions; substantial fines |
| **Deceptive formats** | Making ads look like organic editorial or news | Critical | Multiplied penalties; consent orders |

---

## Compliance Monitoring Process

### Pre-Publication Review
1. **Brief compliance check**: Ensure brief includes required disclosure language and placement instructions
2. **Draft review**: Verify disclosure appears correctly in submitted draft content
3. **Legal review** (if applicable): Route regulated industry content through legal team
4. **Platform tool verification**: Confirm native branded content tools are activated

### Post-Publication Audit
1. **24-hour check**: Review published content within 24 hours for disclosure compliance
2. **Spot checks**: Random monthly audits of active creator partnerships
3. **Screenshot documentation**: Capture and archive all sponsored posts for compliance records
4. **Engagement monitoring**: Watch for creator responses to comments that may make additional claims

### Quarterly Compliance Review
- [ ] Audit all active influencer partnerships for disclosure compliance
- [ ] Review any FTC updates or enforcement actions in your category
- [ ] Update disclosure guidelines based on new regulatory guidance
- [ ] Re-train creator partners on any updated requirements
- [ ] Document compliance findings in internal audit log

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## COPPA Requirements for Children's Content

The Children's Online Privacy Protection Act (COPPA) applies when content is **directed to children under 13** or when the creator has **actual knowledge** that children under 13 are in the audience.

### COPPA Compliance Checklist
- [ ] Determine if the creator's audience includes a significant percentage of children under 13
- [ ] If children's content: no behavioral advertising, no data collection without parental consent
- [ ] Comply with platform-specific children's content designations (YouTube "Made for Kids")
- [ ] Avoid content formats that blur advertising and entertainment for young audiences
- [ ] Do not use child influencers without verifying compliance with child labor laws AND COPPA
- [ ] Ensure landing pages and linked sites are also COPPA-compliant
- [ ] Review FTC's updated COPPA Rule for social media and connected device requirements

### Child Influencer Considerations
| Requirement | Details |
|-------------|---------|
| **Parental consent** | Written consent from parent/guardian for all commercial content |
| **Child labor laws** | Comply with state/local child performer laws (Coogan Law where applicable) |
| **Trust accounts** | Some jurisdictions require a portion of earnings be held in trust |
| **Content restrictions** | Heightened scrutiny on products marketed through child endorsers |
| **Privacy** | No sharing of child's personal information, school, or location details |
| **Platform age limits** | Most platforms require users to be 13+; content featuring minors requires additional safeguards |
