Can you tell the difference? But he hasn’t done anything

Paid reviews by bloggers to come under FTC scrutiny

October 8th, 2009 at 08:55am

But after reading multiple articles on the matter, I am none the wiser as to who falls under FTC jurisdiction.

The story, in case you missed it a few days ago, is that the US Federal Trade Commission has decided that paid reviews by bloggers need to be disclosed as paid reviews, which seems fair enough although I don’t know how it can be enforced…especially seeing as the one time I wrote something which people thought was a paid review, it wasn’t, not that anyone could easily prove it one way or the other.

The FTC will require that writers on the Web clearly disclose any freebies or payments they get from companies for reviewing their products. The commission also said advertisers featuring testimonials that claim dramatic results cannot hide behind disclaimers that the results aren’t typical.

The FTC said its commissioners voted 4-0 to approve the final guidelines, which had been expected. The guides are not binding law, but rather interpretations of law that hope to help advertisers comply with regulations. Violating the rules, which take effect Dec. 1, could result in various sanctions including a lawsuit.

Testimonials have to spell out what consumers should expect to experience with their products. Previously, companies had just included disclaimers when results were out of the ordinary — such as a large weight loss — noting that the experience was not typical for all customers.
For bloggers, the FTC stopped short of specifying how they must disclose conflicts of interest. Rich Cleland, assistant director of the FTC’s advertising practices division, said the disclosure must be “clear and conspicuous,” no matter what form it will take.

For most bloggers, the threat of having to face an expensive lawsuit which they can’t afford to defend would be a big enough threat, and for that reason alone the story grabbed my interest and I wanted to know who this applies to…trouble is, I can’t work it out.

I should be safe as I’m an Australian resident blogging on a server located in Melbourne, owned by an Australian business…but I do have a .com domain name which falls under the jurisdiction of ICANN, who are American. That’s a tenuous link at best. Things become a bit more tricky if I ever decide to move the physical hosting of this site back over to the US, or if I write a paid review whilst in the US.

The point is, there is no clear boundary on the jurisdiction of the FTC, and it seems to me that if a blog has any part of itself in the US, it’s fair game, and the blogger should consider how the FTC’s rules apply to them. Yet another case where the lawyers are the winners.


Entry Filed under: IT News,Samuel's Editorials

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  • 1. Clayton Northcutt  |  October 13th, 2009 at 8:05 pm

    You do not fall under the jurisdiction of the FTC Samuel, as much as you might like to. There is no nexus between the corresponding laws in the US and Australia. It is partly the reason why no US companies themselves are bringing lawsuits against illegal music/movie/etc. sharers here.

  • 2. Samuel  |  October 14th, 2009 at 7:44 am

    I personally don’t come under FTC jurisdiction, but if I move the site back to a US server at some point, surely the hosting company providing the hosting service would come under FTC jurisdiction.


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