Legalizing the Responsibility of Influencers in Product Advertising

New obligations for influencers in advertising

The draft of the revised Advertising Law, published in early March 2024, introduces a series of new regulations managing the advertising activities of celebrities. These measures aim to address the issue of false advertising by celebrities and to protect consumer rights.

The draft law introduces a new legal concept: "influential product advertisers," identified in two ways: (1) individuals with social media accounts on cross-border platforms with 500,000 or more followers, or (2) experts, reputable individuals, or those who garner societal attention in specific fields, as defined by the Government.

Influential product advertisers must fulfill the following obligations:

• Comply with the laws on advertising and other related legal regulations concerning the features, quality, and utility of goods and services when advertising.

• Have a written contract with the organization or individual whose products, goods, or services are being advertised, with the content of the advertisement approved and confirmed by them before execution.

• Be directly responsible for the content of the advertisement regarding the features, quality, utility, and effectiveness of the advertised product, goods, or services.

Ambiguity in the responsibility of influential product advertisers

In product advertising, there exists a relationship between the advertised content delivered to the public and the actual quality of the products used by consumers. Regulatory authorities aim to address the discrepancy between advertised content and actual product quality through imposing responsibility on the advertiser.

However, a distinction should be made between two types of advertising content.

Firstly, there is the advertising content produced by the manufacturer or business entity, which the influencer then disseminates. In this case, the influencer does not have control over the product’s quality or the advertised content relative to its actual quality. The influencer can only request the manufacturer or business entity to provide evidence (if available) of the product's quality and verify that evidence. In such cases, it is unreasonable for the influencer to bear responsibility for actions they cannot guarantee. For example, it would be unfair to hold a model or beauty queen responsible for claims like "shiny hair all day long" in a shampoo commercial.

Furthermore, according to the 2023 Consumer Protection Law, the influencer engaged in advertising is considered “third party in providing information about goods and services to consumers.” This third party is not liable for providing inaccurate or incomplete information if they have followed all legal measures to verify the accuracy and completeness of the product information.

Secondly, there is advertising content created by the influencer based on personal experience. In this scenario, while the influencer cannot control the product’s quality, they can control the content of the advertisement relative to their personal experience with the product. Here, the influencer can be held accountable for the advertising content they publish. If an influencer posts false advertising content that causes harm to consumers, they may be subject to civil liability for damages, administrative liability for posting false information, or criminal liability for fraudulent advertising as per current laws.

Additionally, if an influencer who advertises a product is also the product's seller, they are considered the advertiser and are responsible for the quality of the product they are selling according to existing laws.

The current draft of the revised Advertising Law lumps together different cases of advertising content, potentially leading to ambiguous responsibility for product advertisers. Therefore, the drafting body should consider separating the two cases of advertising content and assign corresponding duties and responsibilities.

International experience in regulating influencer advertising behavior through industry standards

Globally, several countries and international organizations have developed ethical standards and codes of conduct for the advertising industry. These standards aim to ensure that advertising by influencers remains transparent and honest, combating deceptive advertising practices. Such standards generally impose two main requirements:

Firstly, influencers must publicly disclose when they are advertising, particularly when there is a relationship between the influencer and the product owner that could affect the honesty of the advertisement, such as financial relationships (being paid to advertise, receiving free or discounted products/services), employment relationships, or familial ties.

Secondly, the method of disclosure must be accessible, such as avoiding placing information in the "see more" section or directing viewers to another page via link, and using simple, clear language.

Other considerations include not speaking about personal experiences without using the product or service: not advertising products requiring scientific evidence (e.g., pharmaceuticals, supplements) without such proof, and complying with legal requirements when advertising age-restricted products (alcohol, tobacco) or those with attached rewards.

In several countries, specific online advertising standards for influencers have been issued, such as the Ad Standard Guidelines for Influencers by the Australian National Advertising Association (AAAA) and Disclosures 101 for Social Media Influencers by the U.S. Federal Trade Commission (FTC).

At the international level, voluntary bodies like the International Committee for Ad Self-Regulation (ICAS) have become global platforms promoting responsible advertising through effective implementation of industry standards. Additionally, the International Chamber of Commerce (ICC) Marketing and Advertising Communications Code is considered the gold standard in the advertising industry.

To achieve the short-term goal of addressing false advertising by influencers and the long-term goal of promoting honest and transparent advertising while protecting consumer rights, regulatory authorities in Vietnam should consider a flexible combination of legal regulations and industry codes of conduct. Authorities could establish strict rules on transparency obligations for influencers when advertising and either independently or in collaboration with associations develop codes of conduct for transparent advertising by celebrities.

According to Saigon Economic Times

(This translation was assisted by an automated AI translation tool.)