FTC Issues Enforcement Policy Statement and Guidance on "Native Advertising"

“Native Advertising” has been on the radar screen for several years, with consumer groups, businesses and regulators alike considering what the rules of the game should be to avoid deception as the nature of publishing and advertising continue to evolve at a dizzying pace.  Those rules became clearer on December 22, 2015, when the Federal Trade Commission (FTC) released an Enforcement Policy Statement on native advertising and deceptively formatted advertising, along with associated guide for business, entitled Native Advertising: A Guide for Business.

Emphasizing that its Enforcement Policy Statement applies to commercial speech under the FTC’s jurisdiction, the watchword is transparency.  The FTC’s policy cites decades of prior policy statements, guidance and cases, but in its business guidance, the FTC distills its recommendations into three basic points:

1.      From the FTC’s perspective, the watchword is transparency.  An advertisement or promotional message shouldn’t suggest or imply to consumers that it’s anything other than an ad.

2.      Some native ads may be so clearly commercial in nature that they are unlikely to mislead consumers even without a specific disclosure.  In other instances, a disclosure may be necessary to ensure that consumers understand that the content is advertising.

3.      If a disclosure is necessary to prevent deception, the disclosure must be clear and prominent.

Be fair and tell the truth.  These principles remain the lodestones by which the FTC will likely continue to evaluate advertising, including native advertising.