Influencer marketing has transformed how brands connect with consumers, leveraging social media’s power to convey authentic, relatable messages. Since followers often view influencers as trustworthy persons, their product endorsements carry credibility, particularly when woven into personal experiences.
This approach significantly shapes consumer attitudes and purchasing behaviour. Studies show that followers tend to react more favourably to posts where the commercial intent isn’t apparent, making influencers’ disclosures crucial for enabling consumers to make informed decisions.
While there is currently no EU-specific law exclusively regulating influencer marketing, these commercial practices are however still governed by the Unfair Commercial Practices Directive (UCPD). This directive protects consumers from misleading practices that could distort their purchase choices.
Specifically, Article 7 (2) of the directive considers a misleading omission if material information, including the commercial nature of a post, is hidden or presented ambiguously. In addition, Annex 1 (11) of the directive forbids using editorial content to promote products without clear disclosure when payment is involved. Annex 1 (22) prohibits false claims or creating the impression that the trader is not acting for purposes relating to their trader, business, craft or profession, or falsely representing oneself as a consumer.
The European Commission’s updated UCPD guidelines extend these prohibitions to influencer marketing, recognising it as a commercial practice with significant implications for consumer behaviour.
These regulations apply to all business-to-consumer transactions. Under the UCPD, a ‘trader’ is anyone acting in a commercial capacity. By engaging in regular, profit-oriented activities like paid endorsements, bartering for services, or affiliate marketing, influencers, regardless of the size of their audience, qualify as traders. This means they must comply with consumer protection regulations and are legally obliged to disclose their commercial relationships transparently.
To ensure compliance, influencers are required to: a) clearly disclose the commercial intent of their posts, whether they are sponsored, bartered or affiliate-linked; b) avoid pretending to be ordinary consumers when representing a brand or their own business; and c) abstain from claiming personal use of a product they have not really used.
Disclosures such as thanking a brand for an experience, gift, or service without a clear mention of a paid partnership, are considered unacceptable
Influencers are required to explicitly state in writing that their content includes advertising, using clear labels or hashtags like #advert or #advertising. Each individual post, reel or story should be labelled accordingly. Additionally, disclosure labels and hashtags should be placed at the beginning of captions or prominently on the first screen of content. It is crucial that these disclosures are visible, with appropriate contrast between the text and background to ensure clarity for viewers.
Disclosures such as thanking a brand for an experience, gift or service without a clear mention of a paid partnership, are considered unacceptable. The use of vague hashtags like #gifted, #partner or #ambassador is also discouraged, as they do not clearly communicate the commercial nature of the relationship.
Disclosures should also not be limited to simply tagging the brand. Additionally, sharing discount codes without clarifying the business connection, using ambiguous phrases like ‘thank you’, or hiding the disclosure among other text or hashtags are all practices that fail to meet transparency requirements.
Under EU consumer law, influencers, brands and marketing agencies share the responsibility of ensuring transparency. Failure to disclose commercial relationships constitutes a breach of consumer protection laws, which may lead to investigations and judicial proceedings. The Civil Courts (Commercial Section) may impose penalties or compliance orders on non-compliant influencers, marketing agencies or brands.
To facilitate compliance with consumer protection rules, the Malta Competition and Consumer Affairs Authority (MCCAA) is organising an informative seminar titled ‘Building Trust: Influencer Marketing and Consumer Rights’ aimed at the local influencer marketing industry. The seminar is designed to provide influencers and marketing agencies with crucial insights into consumer protection laws and regulations. The interactive session will also serve as a platform to discuss common challenges influencers and agencies face when creating or disclosing commercial content on social media, offering practical solutions and guidance to ensure compliance with consumer laws.
The information session will be held on Thursday, from 10am till noon at the Poseidon Hall, AX ODYCY Hotel, Qawra. Those interested in attending may register by e-mailing mccaaevents@mccaa.org.mt.
As influencer marketing continues to shape consumer behaviour, transparency remains the cornerstone of consumer trust. Influencers must observe consumer protection rules to avoid misleading their followers. This responsibility reinforces the importance of disclosures, ensuring consumers can distinguish between genuine endorsements and commercial content.
Odette Vella is director, Information and Research Directorate, MCCAA.