In recognition of the increasing influence of social media online, the Federal Trade Commission (FTC) on October 5, 2009, for the first time since 1980, issued new regulations governing online testimonials and endorsements by bloggers.
If you operate a blog site, your exposure to legal liability may have increased exponentially. Violators could be fined up to $11,000. And you face new liability associated with statements made by your endorsers, such as affiliates.
It's critical that you understand how these regulations affect your website business.
A Quick Summary
In a nutshell, the new regulations are aimed at protection of online consumers. The FTC wants to regulate blogs to see if they're trading testimonials and favorable reviews for some kind of financial reward. That's a good thing.
The not-so-good-thing is that the new regulations may be overbroad and even in conflict with existing legal precedent. As a result, they may subject harmless, every-day activities to potential liability. Serious liability.
A good way to see how the regulations affect you is to consider 3 basic questions discussed below.
No. 1 - Threshold Question: Are You Even Covered By The New Regulations?
If you have a blog on your site, or if a blog is essentially your site, and all you do is publish creative content about your areas of interest, you're not even covered by the new regulations.
No worries.
No. 2 - Are You Promoting Someone Else's Products or Services?
If you promote or pitch someone else's products or services on your blog, there are 2 key requirements under the new regulations:
* disclose "material connections" -- you must disclose all incentives you receive -- cash, gifts, benefits, etc. - for promoting or pitching the product or service, and
* disclose typical results -- you can't get away any more with small print disclaimers such as "results not typical"; you're now required to provide a more complete and forthright picture of what can be reasonably expected from a product or service.