Does Australian Consumer Law Apply to Influencer Marketing?

Influencer marketing has become a powerful way for businesses to promote their products and services, build brand awareness and connect with consumers. However, with sponsored posts, gifted products and paid partnerships now commonplace, it is important to understand where Australian Consumer Law (ACL) fits in.

Whether you are a business engaging influencers or a content creator working with brands, the rules around misleading advertising, transparency and consumer protection still apply. Understanding these obligations is essential to ensuring that promotional content is both effective and legally compliant.

What Does the Australian Consumer Law Say?

The ACL, contained in Schedule 2 of the Competition and Consumer Act 2010 (Cth), regulates how businesses promote and sell goods and services. Two provisions are particularly relevant to influencer marketing:

• Section 18: prohibits misleading or deceptive conduct, or conduct likely to mislead or deceive, in trade or commerce.
• Section 29: prohibits false or misleading representations about goods and services, including claims about their quality, benefits, performance or sponsorship.

These provisions apply to advertising across all platforms, including Instagram, TikTok and YouTube. A business cannot avoid its obligations simply because a promotion is delivered through an influencer rather than a traditional advertisement.

In practice, this means that claims made in social media posts, videos, captions and testimonials must be accurate, truthful and capable of being substantiated.

Do Influencers Need to Disclose Paid Partnerships?

Transparency is key to compliant influencer marketing.

Where influencers receive payment, free products, discounts or other benefits, sponsored content should be clearly identified as advertising. Vague disclosures such as “sp” or disclosures hidden among hashtags may not be sufficient.

The ACCC has identified inadequate disclosure of commercial relationships as a concern, highlighting the importance of clear and prominent disclosures for influencers and businesses.

Can Influencers Be Held Responsible?

Yes. Influencers may be subject to the ACL when engaging in conduct in trade or commerce.

For example, making unsubstantiated product claims or promoting services using misleading statements may have legal consequences. Businesses and marketing agencies may also be exposed depending on their involvement.

A commercial agreement does not remove a party’s obligations under consumer law, with responsibility depending on the circumstances and each party’s conduct.

What Should Businesses Do to Stay Compliant?

Businesses should take practical steps to reduce the risk of breaching consumer protection laws, including:

• Ensuring all advertising claims are accurate and supported by evidence.
• Requiring influencers to clearly disclose paid or gifted partnerships.
• Using written agreements that outline advertising obligations, disclosure requirements and approval processes.
• Monitoring sponsored content and responding to misleading statements or comments.
• Reviewing promotional material before publication to ensure it complies with the ACL.

Importantly, engaging an influencer does not remove a business's responsibility to ensure its advertising complies with the ACL. Businesses should also consider whether their internal marketing processes provide adequate oversight of external promotions.

What Happens if the Rules Are Breached?

Breaches of the ACL may result in ACCC investigations, infringement notices, court proceedings, penalties or other remedies. Misleading influencer campaigns can also damage a business’s reputation and consumer trust, making compliance an essential part of any influencer marketing strategy.

The Bottom Line

Influencer marketing offers businesses valuable opportunities to connect with consumers, but it is not exempt from Australian consumer protection laws.

Both brands and influencers should understand their obligations, ensure promotional claims are accurate and make commercial relationships clear. Taking these steps can help businesses build trust, protect their reputation and reduce the risk of costly compliance issues.

Need assistance?

At Lawgix, we understand the importance of protecting your business and navigating your legal obligations. If you have questions about advertising, consumer law or commercial agreements, contact our team to discuss how we may be able to assist.