CMA Issues Updated Social Media Compliance Principles to Combat Hidden Advertising and Fake Reviews Under New Consumer Law Powers

The Competition and Markets Authority (CMA) has published an updated set of six key compliance principles aimed at social media platforms, reinforcing that hidden advertising and fake reviews are harmful and illegal. Hidden advertising occurs where a content creator has been paid or otherwise incentivised to endorse a product, yet fails to clearly identify the content as advertising. The principles have been revised to reflect guidance the CMA has given on the obligations of publishers of reviews, contained in paragraph 13 of Schedule 20 to the Digital Markets, Competition and Consumers Act 2024 (DMCC Act). The CMA considers that social media platforms are far more likely to comply with consumer protection law and reduce the risk of future enforcement action if they implement these principles. Under the DMCC Act, the CMA now has power to issue fines and directions directly to those who break consumer protection law, and platforms should keep their compliance practices under review as technology and the law continue to evolve. The guidance applies to all formats of a platform’s service, including desktop, mobile and app-based formats, and the term “product” covers goods, services and digital content. Platforms have a duty under consumer law to take reasonable and proportionate steps to prevent the publication of fake consumer reviews, consumer reviews that conceal the fact they have been incentivised, and consumer review information that is false or misleading. They also have a duty to act with professional diligence under the DMCC Act. The CMA believes all platforms must have a clear policy on the prevention and removal of banned reviews, appropriate to the risks of such material appearing on their media, and should assess those risks based on factors such as the platform’s business model, the sources of content, the functionality of the publication medium, the type of content shown to consumers, and the potential impact of that content.

The first principle centres on informing users that incentivised endorsements must be clearly identified as advertising and clearly distinguishable from other content, and that fake reviews are absolutely forbidden. Platforms should ensure their users, especially content creators, are aware that hidden advertising and fake reviews are not allowed on the service, whatever format they are using, and that breaking this rule can lead to consequences. This should be set out in a published policy that is clear, readily accessible to users and clearly signposted from relevant parts of the service. The policy should state prominently that hidden advertising such as unlabelled incentivised endorsements is prohibited, that any reviews must be based on the person’s genuine experience, and that content creators must label content as advertising where they have been paid or otherwise incentivised to endorse a product, service or brand, or where they have a commercial interest in the brand or its products. Platforms should also require content creators to use any available labelling tool. In addition, platforms need to provide timely, clear, unambiguous and sufficiently detailed guidance, using examples where appropriate, covering what constitutes an incentivised endorsement, when disclosure is required, and how to label such endorsements using relevant tools. Platforms are also expected to make clear that there are potential sanctions for breaching their terms of service in relation to hidden advertising and fake reviews, and to flag and remind users of the main requirements at key moments, such as when they start using the service and when they are posting content. Regular assessment of the effectiveness of the information provided in preventing fake reviews and hidden advertising is also essential, so that platforms can adjust their approach as practices evolve.

The second principle requires platforms to provide content creators with tools that make it easy and effective to label any content as advertising. Platforms should make it simple for all content creators to label their content in a way which is clear and prominent, no matter what device they are using, so they can comply with their legal obligations. The CMA considers that the law requires content to be clearly recognisable as advertising as soon as the reader starts to engage with it. One practical example is offering a one-click tool that enables content creators to label their content as advertising, with the functionality identifying advertising consistently across the platform in a way that complies with the law and the Advertising Standards Authority’s CAP Code. Platforms should actively promote the availability of such tools so that content creators actually use them when posting advertising content. They should also use algorithms that identify potential unlabelled advertising content and automatically prompt content creators to label it as advertising. Regular reviews of the tool and its uptake by content creators are necessary, followed by steps to improve it where uptake remains low or creators struggle to use it. The overarching goal is to reduce the risk of hidden advertising appearing by lowering the burden on honest content creators and making compliance the default, rather than the exception. By embedding easy-to-use labelling mechanisms into the platform’s workflow, platforms can help ensure that consumers are not deceived and that creators understand their responsibilities. The guidance recognises that each platform is different and may develop its own ways of complying, but the expectation is clear: the tools must exist, must be promoted, and must be refined over time.

The third principle focuses on taking appropriate, proportionate, proactive steps and using available technology to prevent hidden advertising and fake reviews from appearing on a platform’s site. Platforms should assess the risk of hidden advertising and fake reviews occurring on their site and take proactive steps to detect suspected content, prevent it from appearing, remove it, and hold content creators to account if hidden adverts or fake reviews still appear. The CMA encourages the use of technology and algorithms designed to identify proactively content containing incentivised endorsements that have not been clearly and prominently labelled as advertising. Such systems should enable platforms to invite content creators posting suspected hidden advertising to label it properly or confirm that it is not in fact advertising. Any algorithm put in place should be effective and, as a minimum, should take into account relevant factors such as metadata of any content, including captions that tag specific brands, embedded links to brands’ websites, or affiliate links added above or beneath content. It should also consider branded content prominently visible within image or video content that can be reasonably identified by automated image recognition tools. Platforms are expected to carry out regular tests and reviews of their systems and processes, updating them to ensure they remain effective and keep pace with evolving abuse, including by conducting manual checks of content. This is likely to be particularly important if platforms become aware that hidden advertising or fake reviews are still appearing on their site, whether through notifications, user or regulator reports, or through their own proactive means. Where an algorithm identifies suspected hidden advertising or fake reviews, platforms should take reasonable steps such as flagging the content to the relevant brand for confirmation. This proactive approach is central to the CMA’s vision of platforms taking ownership of the problem rather than waiting for consumers or regulators to complain.

The fourth principle requires platforms to make it simple for users to report suspected hidden advertising and fake reviews easily and effectively. Depending on how comprehensive the platform’s prevention measures are, it is likely to be necessary to enable other parties to report suspected hidden advertising and fake reviews so that the platform can take appropriate and effective action. It is particularly important that enforcers should have an effective means of contacting the platform to require action to be taken. Platforms should provide a publicly accessible mechanism for any users to report suspected hidden advertising and fake reviews, and should make clear that this tool can be used to report such content even if it can also be used to report other concerns. In addition, platforms should provide a tool or contact address for regulators to report suspected hidden advertising, fake reviews and any other concerns, and should ensure systems are in place to act rapidly to address the problem. This principle acknowledges that platforms cannot rely on their own detection alone; they must open additional channels for consumers, competitors, brands and regulators to alert them to violations. It also creates a clear expectation that platforms will take such reports seriously and act quickly, not simply acknowledge them. The fifth principle complements this by requiring platforms to facilitate legal compliance by brands. Hidden advertising and fake reviews by content creators is illegal, and platforms should take proactive steps to raise awareness and understanding among brands of the platform’s terms of service, policies and any other information relating to incentivised endorsements and fake reviews. Platforms should encourage brands to check that content which endorses them is properly labelled as advertising and is genuine. This could include taking appropriate action to inform the brand involved where content is identified either through algorithms or through reporting mechanisms, and promoting compliance by brands by providing functionality that makes it easy for brands to review content mentioning their brand and request action if necessary. By engaging brands as partners in compliance, platforms can reduce the incidence of hidden advertising and fake reviews at the source.

The sixth principle requires platforms to enforce their terms and conditions and take appropriate action when violations occur. The CMA explicitly warns platforms not to ignore hidden advertising or fake reviews posted by content creators, even where prevention steps have been put in place. Platforms should take action to encourage compliance with and enforce their terms of service so that banned content does not continue to appear. Practical steps include promptly removing content which has been confirmed as hidden advertising or a fake review, and applying proportionate and effective sanctions to content creators who have posted such material, to deter them from repeating the behaviour. Sanctions could include blocking content creators from posting for a defined period, placing warnings on their pages alerting users that they have posted banned content, suspending their account, and, if there are still infringements, closing the account completely. Sanctions should be escalated for repeat offenders. Platforms should conduct regular assessments of the effectiveness of their sanctions regime in light of observed and emerging practices, maintain records of the steps they have taken to deal with hidden advertising and fake reviews, and notify the CMA of systematic infringements by content creators. This record-keeping helps platforms apply appropriate sanctions to repeat offenders and demonstrate to enforcers that they have been taking the reasonable and proportionate steps necessary to ensure compliance with consumer law. The guidance also provides definitions: an incentivised endorsement means content where a brand directly or through an intermediary makes payment to a content creator in connection with promoting itself or its products, or where there is a commercial relationship such as payment made or offered in the prior year, a long-term ambassadorship, an ownership interest in the brand, or where the content creator is a director or management board member and their post depicts or refers to the brand. Payment includes monetary payment, commission, loans of a product or service, free products or services, discounts, shares or equity, free leases or rentals, freebies, free stays, and invitations to events. The CMA has also co-published a guide on how to label ads correctly with the Committee of Advertising Practice, as well as a guide for influencers on social media endorsements, and detailed guidance on fake reviews and unfair commercial practices, while noting that its guidance does not constitute legal advice.