The Government is Enforcing Social Media Influencers. Here Are 3 Takeaway’s From The Changes in 2020.

The Canadian Competition Bureau and the American FTC & FDA have begun stricter enforcement around Social Media Influencer Marketing. As of February, 2020 over 100 letters have been sent to brands and advertising agencies warning them to comply with the new Canadian Laws. Similarly, in America the FTC and FDA have defined disclosure rules for Social Media Sponsored postings in their latest release, “Disclosures 101 for Social Media Influencers”. 

Good news influencers, no need to go in panic mode researching this topic! Below Upwrd has broken down the most important takeaway’s and changes you can put into play today.

1) Adequate Disclosure is Required When Sponsoring a Product on Social Media

Canadian and American influencer’s must disclose any “material connection” they have to a brand. 

You must reveal if you’ve received:

  1. Payment in money or commissions.
  2. Free products or services.
  3. Discounts
  4. Free tickets to events or trips
2) In Canada Location of the Disclosure Matters, in America it Does Not!

Canadian Influencers:

Canadian influencers must make disclosures immediately visible on every sponsored post, on all platforms. A simple #ad or #sponsored hashtag in the post is not considered compliant because it will in most cases not appear on the post at first glace, one needs to click on “Read More” to see it.

American Influencers:

In the FTC’s release of “Disclosures 101 for Social Media Influencers.” There are two characteristics of a proper disclosure:

  • The placement of the disclosure should not be “hard to miss”
  • The disclosure should be clear and simple. Vague hashtags such as #spon or #collab are not compliant, however the use of #ad or #sponsored is enough. 
3) Both Canadian and American Governing Bodies Are Studying The Impact and Role of Endorsements, Therefore More Changes Are Coming.

Governing bodies are currently researching how consumers respond to posts clearly marked with endorsement disclosures and comparing them to posts with no disclosures at all. “In both studies, we are interested in the role of endorsement and payment status on participants’ recall, benefit and risk perceptions, and behavioral intentions,” the FDA has written. 

If you require more information on this topic, feel free to check out the following two links:

Canada: https://www.competitionbureau.gc.ca/eic/site/cb-bc.nsf/eng/04512.html

America: https://www.ftc.gov/system/files/documents/plain-language/1001a-influencer-guide-508_1.pdf

Upwrd Company is an industry pioneer in providing accounting support for Social Media Influencers. We help influencers secure government grants to fuel their growth, keep track of government tax filings, deliver real time profitability reports, and help incorporate their business. We would like to join your team and become your on-demand accountants, contact us today if you would like to learn more.


  • Joe

    Great read...these are some important changes and many influencers do not know about them.

  • admin

    Thank you Joe. Appreciate the share on your blog. There are many new regulations coming and we will continue to post about them as we learn more!

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