New legislation could reshape the landscape for sports influencers
With 2024 shaping up to be a bumper year for sport, it goes without saying that marketing by sports influencers is also set to see an increase as brands look to take advantage of the fixtures to raise their profiles.
But expert lawyers are warning these brands and influencers not to fall foul of consumer laws with the Digital Markets, Competition and Consumers Bill expected to pass through parliament in the first half of this year.
Stephen Green, a partner in the corporate and commercial team at national law firm Clarke Willmott LLP, said this summer’s biggest sporting events could coincide with the launch of the Competition and Markets Authority (CMA) new powers to sanction the non-compliant.
He said: “Influencers can be any human, animal or virtually produced persona that is active on an online social media platform. Any persona that falls within this definition will be deemed to be an influencer even if they use a different title or descriptor, for example “blogger”, “content creator” or “celebrity”. This means that footballers and athletes are likely to be influencers in the eyes of the CMA, even if they do not think of themselves this way.
“Most regulation of influencers has focussed on labelling requirements relating to advertising. Both the ASA and the CMA are clear that any promotion of a brand or product by an influencer needs to be immediately clear to the consumer as an advert.
“The new Bill will significantly increase the CMA’s enforcement powers including imposing significant fines on those who breach the regulations, these can be up to 10% of annual global turnover, or where action is brought against an individual, up to £300,000.”
Other powers include being able to directly investigate any suspected infringements of the CPR as well as any practice which it believes may harm the wider interest of the UK consumer. The CMA will also establish breaches of the law and issue “enforcement notices” without needing to go to court, the only regulator with such powers.
What can businesses do to demonstrate compliance with the law?
Have clear guidelines or policies in place and communicate to employees, influencers and their agents what is expected from them when promoting the brand.
Consider including clear instructions relating to content creation and influencer’s obligations in any free items which are sent to influencers. It would be prudent to do this even where there is no requirement or expectation that the influencer will use or feature the free gift in their content.
Back up guidelines or policies with clear contractual obligations requiring the influencer to comply with the relevant laws and guidelines and, where necessary, setting out consequences for breaching the obligations.
Make sure that relevant members of staff understand the legal obligations which apply to both brands and influencers relating to influencer marketing. This is likely to include ensuring that relevant members of staff receive comprehensive training to help them to identify non-compliant content.
Take a proactive approach to managing influencer marketing, for example by reviewing, and where necessary, making changes to influencer generated content before it is posted and also reviewing content after it is posted and working with influencers to edit or remove non-compliance content.
What can influencers do to demonstrate compliance with the law?
Make sure that they undertaking their obligations relating to labelling requirement, and any additional brand specific requirements relating to products or services that they receive.
Make use of advertising disclosure tools on social media platforms, but be aware that the ASA and CMA have made clear that relying on the disclosure tools along may not be enough.
Stephen continued: “Brands and influencers should take steps now to make sure that they are compliant with influencer marketing laws and guidelines. Both brands and influencers are equally responsible for ensuring that their influencer marketing campaigns are compliant with the CPR’s and, since the Bill doesn’t change the law or introduce any new disclosure requirements, it is unlikely that the CMA will allow a long grace period for non-compliant practices following the Bill becoming law. This means that the CMA’s new powers may come into effect as brands and influencers start to promote content linked to the Euros ad Olympics.
“Given the possibility of headline grabbing fines for non-compliance and the negative publicity that goes along with this brands and influencers alike would do well to avoid attracting publicity for the wrong reasons this summer.”
Clarke Willmott is a national law firm with offices in Birmingham, Bristol, Cardiff, London, Manchester, Southampton and Taunton and is this year celebrating its 135th anniversary.
For more information on how the bill might affect you or your business, you can contact one of Clarke Willmott’s specialist sports solicitors. Visit www.clarkewillmott.com
