[Asia Economy Reporter Kim Bo-kyung] Starting next year, the scope of penalties related to so-called 'hidden advertisements'?where advertisements are not properly disclosed on social media platforms such as YouTube?will be expanded.
Until now, only advertisers were punished for violating the Act on Fair Labeling and Advertising, but going forward, YouTubers, influencers, and celebrities will also be subject to sanctions.
According to the Fair Trade Commission (FTC) on the 25th, the "Guidelines on Labeling and Advertising for Recommendations and Endorsements," which prohibit hidden advertisements on SNS, will undergo a grace period until the end of this year and will be fully enforced starting January next year.
Businesses that engage in unfair advertising, such as posting content disguised as "product reviews" without disclosing that it is an advertisement, must pay a fine of up to 2% of related sales or income, or up to 500 million KRW.
While "businesses" typically refer to advertisers, the FTC considers YouTubers who promote products on SNS in exchange for economic benefits as engaging in business activities, as well as influencers who gain significant profits from related content.
Although the guidelines have been in effect since last month, the FTC has decided to focus on education until the end of the year by organizing a consumer monitoring group to request voluntary corrections of hidden advertisements instead of immediately imposing penalties.
This approach is based on the view that it is more effective to encourage the industry to voluntarily comply with the guidelines rather than the FTC individually cracking down on the numerous videos and photos posted on YouTube and Instagram.
On the 23rd, FTC Chairman Cho Sung-wook attended a symposium on "Consumer Issues on SNS Platforms" and stated, "We plan to support industry self-compliance activities and strengthen monitoring of unfair advertisements on SNS."
The FTC plans to form a consultative body with the industry to encourage advertisers and popular YouTubers to follow the guidelines.
However, if YouTubers or influencers continue to engage in hidden advertisements next year, they may be punished for unfair advertising.
An FTC official said, "If the industry reports cases of hidden advertisements, the FTC will request voluntary corrections, and if not corrected, will consider sanctions. We will encourage voluntary compliance until the end of the year, but if unfair advertising continues thereafter, we will strictly enforce the law."
Since consumers watch videos without knowing they contain hidden advertisements, and both influencers and advertisers profit, the responsibility of related online platform operators such as YouTube is expected to increase.
An FTC official stated, "Online platform operators need to find ways to make advertisement disclosures easier and consider restricting the use of YouTubers who fail to disclose hidden advertisements."
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