Paid influencers must label posts as ads, German court rules

If the influencers are not paid, they can show products without the advertising label, says ruling

BERLIN:

Social media influencers who receive money from companies to promote products must clearly label such posts as advertisements, a top German court ruled on Thursday.

If the influencers are not paid, they can show products without the advertising label, the Federal Court of Justice ruled in the cases of three influencers on Facebook's (FB.O) social media site Instagram.

Influencers with thousands of followers can earn large fees from companies to promotes a product on Instagram.

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The court said one fitness influencer should have been clear she was advertising when she was paid to promote a brand of jam.

However, it dismissed a case against television presenter and influencer Cathy Hummels, whose post about a stuffed toy had led people to the manufacturer's site. She had not been paid for the promotion so was not obliged to label it as an ad, the court ruled.

Instagram last year reached a deal with Britain’s Competition and Markets Authority (CMA) to crack down on hidden advertising by influencers on its photo and video platform.