Facebook’s Instagram agrees restrictions with UK watchdog to curb paid influencers

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Instagram, the photo and video-based social network owned by Facebook Inc (NASDAQ:FB), has agreed measures with the UK’s Competition and Markets Authority (CMA) to curb hidden advertising by ‘influencers’ on its platform.

On Friday, the regulator said Facebook Ireland, which operates Instagram in the UK, has committed to a package of measures to tackle what it calls “hidden advertising”, making it harder for people on the platform to post an advert without labelling it as such, citing mandatory labelling of incentivised posts under consumer protection laws.

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“The [CMA] has been investigating hidden advertising on Instagram over concerns that too many social media influencers are posting content about businesses without making clear where they have been paid or incentivised to do so, and that the platform was not doing enough to tackle the problem. Instagram will now make it easier for all users – and the businesses they promote – to comply with consumer protection law when posting content”, the watchdog said.

The changes include Instagram prompting users to confirm if they have been incentivised in any way to promote a product or service and, if so, require them to disclose this fact clearly. The platform will also extend its ‘paid partnership’ tool to all users, allowing them to easily display a clear label at the top of a post, and to use technology and algorithms designed to spot when users might not have disclosed clearly that their post is an advert and report those users to the businesses being promoted.

“For too long, major platforms have shied away from taking responsibility for hidden advertising on their site. So, this commitment to tackle hidden adverts and overhaul the way people post on Instagram – making it difficult for users to ignore the law – is a welcome step forward”, CMA chief executive Andrea Coscelli said in a statement.

“These changes mean there will be no excuse for businesses to overlook how their brands are being advertised either – making life a lot harder for those who are not upfront and honest with their followers”, the CEO added.

Shares in Facebook were up 0.3% at US$267.5 in pre-market trading in New York on Friday.

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