The Advertising Standards Bureau has recently determined that brand owners are responsible for ensuring that user generated content appearing on their Facebook® pages complies with advertising codes. The determination follows an earlier Federal Court decision which suggests that brand owners may also be held liable for user generated social media content that contravenes Australian consumer laws. These decisions place a heavy onus on brand owners to closely monitor and moderate their social media pages.
Advertising code compliance on Facebook
Advertising regulation in Australia
Advertising in Australia is self-regulated by a set of codes that are administered by the Advertising Standards Bureau (ASB).
The codes apply to "Advertising or Marketing Communications", which are generally defined as:
broadcast or published material and activities over whichthe advertiser has a "reasonable degree of control" and that "draws the attention of the public in a manner calculated to promote or oppose directly, indirectly a product, service, person, or organisation".1
General advertising standards are set out in the Australian Association of National Advertisers Code (the AANA Code). The AANA Code provides that, amongst other things, advertising must not:
- mislead or deceive or be likely to mislead or deceive;
- be discriminatory;
- use inappropriate language; or
- be contrary to prevailing community standards on health and safety.
The AANA Code is complemented by other guidelines directed at particular types of advertising, such as advertising to children, and the advertisement of food, beverages and alcohol.
Enforcement of advertisement standards
Whilst compliance with the codes is voluntary, the ASB may refer advertising that contravenes enforceable regulations and laws to other government bodies (such as the ACCC), which have the power to issue fines, and order the cessation and correction of illegal advertisements.
The ASB may also unilaterally release its adverse determinations to the public and liaise with industry and media bodies to procure the removal of noncompliant advertisements.
Recent complaint in relation to Smirnoff Vodka's Facebook page
Earlier this year, the ASB received a complaint asserting that the brand owner of Smirnoff Vodka, Diageo Australia Ltd, had contravened the AANA Code by instigating, allowing or facilitating the posting of discriminatory and obscene comments on the official Smirnoff Facebook page.2
In response, Smirnoff contended that:
- the Code did not apply to its Facebook page, as the page was simply used as a networking tool for existing product consumers, and did not meet the definition of "Advertising or Marking Communications" (set out above);
- the statements published by users did not represent the opinion of Smirnoff; and
- it wanted to try and allow its Facebook page to be an "honest open channel for discussion" and to that end, did not keenly control user generated content. Smirnoff described this practice as "a universal strategy recommended by Facebook and applied by many successful global brands".
User generated content on social media is "advertising"
Whilst the ASB ultimately concluded that the advertising complained of did not contravene advertising codes, it determined that the codes applied to content generated by advertisers as well as the material or comments posted by users on brand owner Facebook pages, and that, as a result, brand owners are responsible for ensuring that such content complies with advertising standards.
A 2011 decision of the Federal Court also suggests that brand owners may be held liable for false or misleading statements posted on their Facebook and Twitter pages by users or subscribers.3
In the decision, (which was referred to in the advertising complaint against Smirnoff) the Court found that an allergy treatment company, Allergy Pathway, and its sole director had breached certain undertakings previously given to the Court by knowingly allowing false and misleading user generated testimonials to remain on its official Facebook site.
The Court's decision was supported by English defamation case law standing for the proposition that publishers assume liability for the defamatory comments of others in circumstances where the publisher is "aware of the material being published and has accepted general responsibility for its publication".4
Whilst the undertakings were couched in different terms to Australia's misleading and deceptive conduct statutory provisions5, the Courts findings are likely to influence future determinations of liability under these consumer laws in Australia.
In this regard, the ACCC has recently indicated its support of the ASB's Smirnoff Vodka decision, and has explained that the ACCC is committed to pursuing brand owners in respect of misleading and deceptive comments posted by third parties on official brand social media pages.6
Lessons for brand owners using social media
- Recent Australian decisions suggest that brand owners are responsible for ensuring that user generated content appearing on their social media pages complies with advertising codes and consumer laws.
- The decisions place a heavy onus on brand owners to closely monitor and moderate their social media content for compliance.
- Brand owners should familiarise themselves with Australian advertising and consumer laws and review their social networking policies to ensure a correct balance is reached between the censorship of user views on the one hand, and the risks of advertising and consumer law non-compliance on the other.