Why commercial real estate’s rollercoaster year has made good legal advice a necessity

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The commercial real estate sector, like every other industry in the world, has had a rollercoaster of a 2020: ups and downs, some big thrills, and the occasional moments of nausea. We’ve seen investment in the Asia Pacific region fall by 31%, due to lower commitment from large Real Estate Funds, but this has been offset by increasing activity from private equity investors and their teams of lawyers and financiers, many of whom scent opportunity amongst the turbulence.

If 2020 has taught us anything, it’s that it’s risky to rely too much on projections, but for the foreseeable future, it does seem wise to rule out two things for the commercial property market: predictability and stability. If a COVID-19 vaccine is found quickly, the result may be a sudden boom in commercial property, but if the after-effects of the pandemic last longer we will likely see even more sales, restructurings and reconfiguring of properties. Either COVID-19 scenario will keep the market in a state of busy agitation and will require businesses in the sector to stay well informed and agile to adapt and take advantage.  That means you will need the best legal advice.

Now is the time to have the sharpest lawyers on your side

If you don’t already feel you have the sharpest property lawyers advising you, now is the time to remedy that. Commercial retail is one of the most legally complex industries in Australia and no matter what your plans for the future are, getting the right advice from the start is the only way to safeguard yourself from future litigation. To use an obvious metaphor, you wouldn’t start building a property without laying foundations, and you shouldn’t be building or growing your business without equally sturdy legal support.

You need experts who can help you on two pandemic-related legal fronts: the immediate impact of emergency legislation, and the laws you will need to keep in mind as you plot your post-COVID future.

Where the immediate impact is concerned, the Australian Government has tried to reduce the economic impact of the virus by introducing a number of new laws, regulations, schemes and codes to protect businesses. Many of these affect commercial property owners, particularly April’s code to regulate leasing arrangements, which protected the rights of renters but restricted owners’ room to maneuver. First-class lawyers will be monitoring future developments closely.

Some of the legal challenges the sector anticipates

When it comes to the future, one of the biggest legal challenges to anticipate is that the sector is also likely to see a bump in takeovers, which generally are always more likely during economic turbulence. Maria Sicola, a founding partner of CityStreams Solutions, a consultancy firm in commercial real estate put it like this: “Opportunistic investors are likely already keeping an eye on the market to swoop in on distressed properties. The risk-averse will remain on the sidelines. There will likely be more acquisitions and takeovers.”

In other words, those who have weathered the crisis well could be looking to absorb those who have not and either expand their Australian portfolios or create one for the first time. This is when top-class legal advice is a matter of business life or death. Whether you want to expand by taking over another business, protect your business from the ambitions of others, or simply get the best deal possible if you have decided to get out of the game, you will need a good commercial and property lawyer at all times.

Your next steps

It should be a given that any legal adviser you choose should understand Australian law intimately. Legislation regulating commercial real estate is complex in this country, with each state maintaining its own laws. Then there is the Native Title Act 1993, which rightly safeguards land that belongs to or is significant to indigenous people. International advisers have made mistakes in the past by not understanding how important this aspect of local land law is when planning new deals, and it’s not an error you can afford, since the public relations damage can be worse than the litigation.

Whatever your plans are, buckle up for the ride ahead. There’s been much discussion of a new normal, but in commercial real estate, you should get ready for a new abnormal, a time of nonstop change, challenge and opportunity. Times like this create winners and losers: getting the right legal advice can make all the difference to which group you end up in.

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We’d be lying if we told you that this bloke isn’t the big honcho of our team, but his name is a dead give-away. The founder of Lazarus Legal, Barry is an old school, tough as nails lawyer. They don’t forge litigators like this anymore. With decades of experience in both Australia and South Africa, his wisdom is as renowned as his name.

Labelling and packaging – a potential new minefield for future litigation

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You’d be forgiven if you didn’t know that right now is Australian Organic Awareness Month – after all, 2020 has been a rather eventful and distracting year. But if you work in the food and drink sector, it’s a month you should be paying attention to, given just how rapidly the once niche market for organic products is growing. We all know that whenever an industry is rising fast, it usually brings out lawyers, regulators and the danger of increased litigation.

For a while now, there’s been an increasing movement of Australian consumers choosing products, particularly food and drink, with an eye on health and ecological impact. According to Ipsos, the environment is now our number one national concern, cited by 41% of Australians in January of this year. However, most experts think that in the long-term COVID-19 will intensify this trend, not supplant it. That would mean an ever-growing demand both inside and outside Australia for products which portray themselves as organic and healthy, or as contributing to a more sustainable, environmentally friendly future.

Can you demonstrate that you have earned what you promise on your label?

Focus on the keyword there being “portray”. Why? Well, many organic food businesses are concerned by the number of producers or distributors that claim they are organic or environmentally friendly but aren’t able to demonstrate exactly what they have done to earn this status. Some claims truly are window dressing. That’s why the major theme of this year’s Australian Organic Awareness Month is false claims and mislabeling.

There have already been some cases of mislabeling which got serious enough to involve commercial litigation lawyers. In 2018, the Australian Competition and Consumer Commission fined a company called GAIA Skin Naturals for false claims, after its products – labelled “Pure/ Natural/ Organic” – were found two contain at least two synthetic chemicals. However, the actual fine was dismissed by some as almost meaningless (less than $40,000) and the case was a rarity, proved on the grounds of deception rather than a strong standard for use of the term “organic”. Yet, this problem remains prevalent as other companies continue to call their products organic or natural without any real justification or basis.

Clearer definitions of things like “organic” or “environmentally friendly” is crucial

It doesn’t help that clear definitions of “organic” or “environmentally friendly” are still vague to non-existent in a regulatory sense. The organic produce trade organization, Australian Organic Limited (AOL) has been working with the Government for years now to press for clear definitions and mandatory regulation aligned with export requirements.

AOL argues that greater clarity will significantly benefit Australia as it seeks to export food products in a world which is increasingly keen for genuinely environmentally friendly products, but also wary of imports that may not live up their claims. Paul da Silva of Arcadian Organic & Natural Meat, Australia’s most successful global supplier of organic meat, says that weak regulation makes it difficult to convince overseas markets of the veracity of organic products and that this is an example of “a big export opportunity for Australia being hampered by red tape.”

Not only for legal purposes but also for your consumers and brand image.

While there is a long way to go before tighter regulations are agreed, it seems certain that they will be introduced in the coming years. If not because of the commercial imperatives suggested by DaSilva, then through people power. Consumers now pay closer attention and have learnt to become more sceptical about claims they see on the packaging or advertising and will press for greater transparency. That means that food and drink businesses which are already labelling their products as organic or are planning to in the near future may need a commercial litigation lawyer on their team, an expert capable of keeping up with regulatory and legal developments.

Of course, this shouldn’t be about meeting legal minimum thresholds but about genuine honesty with consumers and real positive impact on the world, backed up by proof and independent monitoring. That’s the only sure way of staying on the right side of future litigation. Neither good intentions nor a clever marketing team will be enough to keep a business out of trouble if they are taking the shortcuts or are talking the talk but not bothering with the walk.

The good news is that truly ethical and rigorous businesses will win out ultimately. If your company has a truly organic and environmentally focused ethos you will be able to demonstrate the many ways in which you live up to your labelling and will be rewarded by increasingly savvy consumers within Australia and beyond.

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Mark Lazarus, the visionary behind the business and the fresh blood of the Lazarus Legal team, Mark (or Laz as he is often known) owes much of his success to his past experiences. And he’s made it his personal goal to bring that wisdom and formula to the firm.

Combating climate change can be the key to future competitive advantage

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While some countries still debate whether climate change is real, most Australians now accept it as a settled fact, especially after the devastating bush fires at the end of 2019. Even newspapers that have previously resisted the theory, have publicly stated they recognise the problem. So now that we acknowledge the problem, how do we go about solving it? With political and scientific arguments still raging over questions such as whether renewable energy sources can be enough on their own, a solution is in the making. . Recently making the news was that retail giant ALDI has committed to powering its Australian operations with 100% renewable electricity by 2021 even more striking, a laying down of the gauntlet.

Even if, as the small print reveals, ALDI’s delivery vehicles aren’t included in this commitment, it’s still a huge undertaking. ALDI is the 64th biggest user of electricity in Australia, with its 555 stores and eight distribution centres. It has already managed to reduce its emissions by 40% since 2012, but this new pledge – to be delivered through a combination of solar and wind power – will send it straight to the top of the league when it comes to environmentally friendly retailing. Which is, of course, a large part of the point. While ALDI is doubtless truly committed to the fight against climate change, it also knows that proving its eco-credentials to customers will deliver a competitive advantage in the years ahead.

Consumers are increasingly motivated by environmental concerns

Consumers are increasingly motivated by environmental concerns backed up by a plethora of research conducted, so much that you could stack it one metre high, though – given the topic – we don’t recommend you print it to find out. According to Ipsos, by January of this year concern for the environment had risen from a fringe concern to the number one worry of Australians, cited by 41% of the population overall. What’s more, Millennials – key tastemakers, and the demographic who will be the largest consumer group in the future– are even more environmentally conscious, with 48% calling it their top priority.

Whilst COVID-19 has overtaken climate change in media coverage this year, there is an abundance of evidence that the pandemic is actually deepening many young people’s commitment to “build back better” and ensure that the world’s recovery from COVID-19 sets the planet on a better and more sustainable path. These consumers are likely to increasingly embrace brands which can demonstrate they are trying to combat climate change, and reject those that do not.

This has huge implications for all retailers and producers, not just giants like ALDI. If you run a smaller business and still think of environmental awareness as a luxury or passing trend, wake up now or risk being left behind. You should be looking at every aspect of your business, from the vehicles you use to deliver your product to the packaging that ends up in consumer’s hands, and working out how you can make changes towards sustainability.

What this means for you as a business.

If you aren’t a retailer or producer yourself but part of the supply or service chain that supports them, then you need to honestly assess whether you are likely to be seen as part of the problem. Many retailers will come under increasing pressure to cut ties to partners which are seen as environmentally harmful, such as delivery chains which use inefficient vehicles. Last year, there was controversy over climate activists engaging in “secondary boycotting”, and this is likely to intensify as concerns over ecological damage grow. Wise businesses will anticipate and adapt now.

If, on the other hand, you are a business who can be seen as part of the solution, then the coming years will be full of opportunity. If you are a small food or drink producer, for example, who can solve a packaging problem like New Zealand-founded coffee brand Allpress Espresso did with their compostable coffee bags, doors will open much more quickly for big new partnerships. If you are a supplier who can help a large retailer or producer meet their climate change targets through an innovative business model or new technology, you may be able to elbow your way past much larger rivals for new contracts.

The coming months and years are likely to be turbulent all over the world, and you need to be ready to seize opportunities while dodging disasters. As always, that’s going to mean assembling a first-class team to have on your side. In the past, that has usually meant appointing first class financial advisers, legal experts and marketers, but in the future, it will also mean environmental consultants able to keep you informed on the latest climate change developments and guide you towards solutions. Just as in the dot com boom, late adopters will probably never be able to catch up.

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Mark Lazarus, the visionary behind the business and the fresh blood of the Lazarus Legal team, Mark (or Laz as he is often known) owes much of his success to his past experiences. And he’s made it his personal goal to bring that wisdom and formula to the firm.

The winds of change are blowing when it comes to corporate criminal responsibility

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There are many adjectives you could pin on 2020, but uneventful isn’t one of them. It’s therefore unsurprising that most businesses probably haven’t paid close attention to the controversy over a range of legal reforms that have been simmering away in legal circles since November of last year. That was when the Australian Government appointed Australian Law Reform Commission (ALRC) released a discussion paper laying out potential – and, some would say, long-overdue – reforms of corporate criminal responsibility law.

It’s definitely unsurprising that this discussion paper proved contentious, given that it was itself one of the many offspring of another controversial reform document, the damning Hayne Commission report recommending sweeping reforms of the banking sector. That report revealed several acts of malfeasance on the part of some financial services companies, and made it inevitable that the question of corporate criminal responsibility would need to be revisited for the first time since 1995.

Corporations made criminally liable for any wrongdoing by rogue employees?

In the following ten months, many lawyers and law bodies have spoken out publicly about the proposed reforms, some in favour and some more critical, including the powerful Law Council of Australia. Arguably the most controversial reform was proposal eight, which “deems the conduct and state of mind of any “associate” to be that of the company”. As legal experts argued, this would make corporations criminally liable for any wrongdoing by rogue employees and increase costs for consumers. The prospect of a new and poorly defined legal risk alarmed many businesses who were paying attention.

On the last day of August, the final set of recommendations from the ALRC were finally published and the good news is that the Commission appears to have listened on this point. Proposal eight has been dropped from the final set of reforms that were tabled in Parliament. Elsewhere, there is much that businesses need to pay attention to, given the impetus behind these reforms and the strong likelihood that they will indeed lead to changes in laws and regulations.

At first, the news might seem alarming for businesses, given that – as Lawyers Weekly notes – the reforms are focused on “strengthening criminal action enforcement against corporations.” However, closer inspection reveals that this stronger stance will be mostly directed at large corporations indulging in the most appalling practices. In this sense, they remain true to the Hayne Commission report which first sparked the reforms into life. Given that some of the offences named include tax evasion, slavery, human trafficking, violation of foreign sanctions, torture, crimes against humanity, war crimes and financing of terrorism, it is to be hoped that most businesses will neither disagree with the reforms nor fear them.

Good news for small businesses?

There is, in fact, some good news for small and medium-sized businesses in that the reforms address the injustice that in the past it was more likely that a small corporation would be targeted for prosecution than a large corporation, with their armies of lawyers. The ALRC makes this absolutely clear in their report: “Small corporations are more likely to be targeted than large corporations, even though the wrongdoing of large corporations may potentially affect far more people.”

There is more good news for small and medium-sized companies. Currently, there is a bewildering range of laws that could potentially apply to businesses. The ALRC’s research identified over 3,100 criminal offences across 25 statutes, which create a significant regulatory compliance burden that impacts all enterprises. The reforms seek to simplify and streamline these laws, reducing the amount of red tape for businesses in the future. Another key recommendation is that there should be greater national consistency with respect to corporate criminal misconduct, something which has been needed in Australia for some time.

How does it impact organisations doing business overseas?

Unfortunately, if you are doing business overseas, the reforms may pose greater challenges. Partly as a result of transnational scandals, particularly in financial services, the reforms seek to beef up laws in this area. This will likely add greater responsibility to companies to ensure compliance with the laws against corporate misconduct not just in Australia but also overseas, which will mean a greater regulatory burden, not a lesser one.

Don’t think that this subject is closed now, however.  Although the Government has pledged to examine the reforms closely, this is likely to be a long process and – as Bennet & Co note – “all or none of the recommendations may be accepted and put into legislation”. If the reforms are adopted they will almost certainly require a major overhaul of Commonwealth legislation, something which is likely to generate further controversy. No matter what happens, smart businesses will need to keep an eye on the reforms as they proceed, or make sure they have legal advisers who monitor developments on their behalf. The winds of change are blowing when it comes to corporate criminal responsibility, and it’s always better to adjust your sails before those winds hit you than be caught by surprise and capsized.

Have any question about commercial law? Get in touch and one of our experienced and competent lawyers will be on your side.

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Mark Lazarus, the visionary behind the business and the fresh blood of the Lazarus Legal team, Mark (or Laz as he is often known) owes much of his success to his past experiences. And he’s made it his personal goal to bring that wisdom and formula to the firm.

Two fast-food giants go head to head

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We all know McDonald’s iconic ‘Big Mac’ trademarked burger sold internationally and renowned on the market since 1967, but have you heard of Hungry Jack’s new ‘Big Jack’ burger? Well just recently on the 28 August, McDonald’s, the giants of the fast-food industry have filed documents in court to sue Hungry Jacks for their “substantially identical with or deceptively similar” burger.

A massive dispute over beef patties

In the ‘fast feud’, McDonald’s claims that Hungry Jacks is acting in ‘bad faith’ by purposefully imitating their ‘Big Mac’ burger in terms of appearance by using strikingly similar ingredients and ultimately infringing on the internationally prominent trademark. McDonald’s further argues in the hefty lawsuit that even the promoted tagline “two all-beef patties, special sauce, lettuce, cheese, pickles, onions – on a sesame seed bun”, which has been used to advertise the famous burger since at least 1974 has been adopted by the new ‘Big Jack’ which uses a substantively similar tagline. Advertised from early July this year, Hungry Jacks have been promoting their ‘special’ new item to excite customers for the upcoming ‘Big Jack’. McDonald’s‘ Mega Mac’s are another trademarked iconic burger that contains double the amount of the ‘Big Mac’. In a similar vein, Hungry Jacks have also been selling their new ‘Mega Jack’ burgers from mid-July. 

Litigation between McDonald's & Hungry Jack's

Source: The Age

How did Hungry Jacks respond to these accusations?

Well, the multinational fast-food giant released a statement on the 4th September 2020 stating that it was “bemused by the trademark lawsuit filed in the Federal Court” and claims that the two burgers are significantly dissimilar in their taste, size, packaging and presentation. The fast-food chain made a statement saying Big Jack is a registered trademark of Hungry Jack’s and it is clearly evident that customers are not confused or misled that the Big Jack and Mega Jack burgers are only available at Hungry Jack’s”. A further statement was made by Hungry Jacks, arguing that their ‘Big Jack’ burger not only flame grills their patties and uses fresh onions, but it also has 25% more beef opposed to the McDonalds product.

 

Nevertheless, with all its rivalries, McDonald’s remains at the apex of the Fast food brands.

 

Outside the burger world, rivalries have always existed and still do. Pepsi vs Coca-Cola, Hershey’s vs Mars Chocolate and Dunkin Donuts vs Starbucks are just some examples of the endless unavoidable feuds between fast food companies internationally.

These rivalries are inevitable in the FMCG domain but...

in many ways can be the catalysts for innovation in terms of advancements, updates, new products, better customer experience, as each business tries to get ahead of the game.

As author Alcott states “Rivalry adds so much to the charm of one’s conquests”.

 

It is certainly exciting to see how the current feud between the two burger giants unfold in the coming weeks.

Have any question about trademarks, copyrights and or need assistance with a business dispute or litigation? Get in touch and one of our experienced and competent lawyers will be on your side.

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Mark Lazarus, the visionary behind the business and the fresh blood of the Lazarus Legal team, Mark (or Laz as he is often known) owes much of his success to his past experiences. And he’s made it his personal goal to bring that wisdom and formula to the firm.

Legalities of Playing Copyrighted Music In Your Business

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Is your business licensed to play music? If not, don’t let your background music come back to bite you.

No-one particularly likes silence, especially if you want to create a vibe for your customers while they sip on their roasted double espresso or meander through your store. What’s the solution here? Legally, what are your responsibilities around music licencing?

Some clearly audible yet not intrusive background music, maybe streamed straight of your specifically-compiled Spotify playlist or your favourite radio station. 

Nothing could possibly go wrong! Right?

Unfortunately it can if you don’t hold the correct music licenses which permit you to play copyrighted sound recording in your business. This isn’t a bad thing – it’s a way for artists and record labels to earn income from their work.

In October 2018, Melbourne Bar Hairy Little Sista learned this the hard way when they were
ordered to pay nearly $200,000 in damages for playing nine songs by popular artists including the Beetles and Blue Suede in their venue without paying license fees. 

Despite being warned numerous times that Hairy Little Sista was unlicensed and was therefore infringing copyright, they brazenly continued to do so. Several more letters and one Federal Circuit Court of Australia judgment later, the small business was ordered to pay $185,000 in damages plus costs.

How can you ensure you don't get fined when playing copyrighted music within your business?

Simple... Get Licenced

It’s illegal to play copyrighted music for commercial purposes without a license. Under the Copyright Act 1968 (Cth), anyone who wishes to broadcast, communicate or publically perform copyrighted sound recordings must obtain a license to do so from the copyright
holders.

It’s not just music streaming or CD’s that you need to be licensed for. You also need a license if you play music videos on a screen in your business, or the radio as telephone hold music.

Confusingly, businesses will often require two licenses, one for the actual song (the composition and lyrics) and another for the recording of that song.

PPCA License - The first type of music licence

The first license is from the Phonographic Performance Company of Australia (PPCA), which is an organisation that represents the interests of record companies and Australian recording artists.

The PPCA collects license fees on behalf of recording artists and labels, ensuring that they receive a fair return for their music. There are a variety of different licenses available, depending on what you are using their music for, for instance, telephone hold music or background music in a store.

You can apply for a PPCA license below.

APRA License - The second type of music licence

The second license commonly required is issued by APRA AMCOS (APRA), who represent songwriters, composers and music publishers.

APRA licenses organisations and businesses to play, perform, copy, record or make available music, and collect royalties on behalf of their members. As APRA issues specific licenses depending on the type of business you are operating (for instance, a restaurant, fitness centre, hotel, or background music for an office), it’s important that you select the license which corresponds to how you
intend to play music.

You can select and apply for the correct APRA AMCOS license below.

No cookie-cutter licensing solution

Of course, the needs of every business is different, and that includes how they play copyrighted music or videos. If you want to ensure that your business is correctly licensed, contact one of our intellectual property experts today on 02 8644 6000 or info@lazaruslegal.com.au.

References

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Anneliese Oldcastle Lazarus Legal

Anneliese Oldcastle is proof that good things come in small packages. With a strong background in both commercial and family law, Anneliese’s practice focuses on family law, succession law and family provision claims, as well as contract law and consumer or commercial disputes. She’s an advisor proficient in untangling the complexities of relationships, legal or otherwise.

Legal Implications of Influencer Disclosure

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Do influencers fully understand their obligations to disclose?

I get it, ‘Legal protection’ doesn’t fill you with excitement when thinking about starting your own business or protecting yourself as a social media star. In fact it’s probably the last thing on your mind……the thing is, it’s kinda important. I know it’s not glamourous but it could jeapordise everything you’ve worked so hard to create if you ignore it.

This is the first of a ‘mini-series’ of posts aimed at educating individual influencers and businesses on legal considerations you need to keep up to date with. The first in this series deals with ‘disclosure’ as an influencer.

When social media was in the early stages, influencers would post photos, advertise brands, get paid for promotions with no regard to the implications. To be fair social media grew so quickly I don’t think the law could keep up. However, things have changed and there are some things you need to know about as an influencer and disclosure.

What changed?

Last year (around March 2017) you may have noticed your favourite influencers disclosing ‘paid promotion with….’ at the top of their posts or #ad in the hashtags. In fact, there was a lot of hype over the new laws requiring influencers to disclose this to their audience.

The effect came about because of the need for transparency for the target audiences of influencers who are being subjected to an advertisement. The new provision was implemented by the Australian Association of National Advertisers (AANA) in March 2017.

Specifically, the AANA stated: “Advertising or marketing communication must be clearly distinguishable as such to the relevant audience” and the advertiser has ‘a reasonable degree of control’ over the material.

What kind of marketing does this apply to?

The most common type of influencer marketing is when a company arranges with an influencer to post content on their social media regarding their brand. In this case, it must be clearly distinguishable as determined by the AANA. This is done correctly when we see posts including a tag @ the company, hashtags regarding the company name, #ad or similar wording which has the same effect.

If, on the other hand an advertiser sends the influencer product with no conditions attached and the influencer goes ahead and posts about the product, then the new provision of the code would not apply due to the lack of content control by the advertiser.

Are the new regulations working?

According to an industry report titled ‘The state of social media and influencer marketing in 2018’ published by the Exposure Co, they found that the majority of the participants did not understand the regulations and how to use them. According to the research ‘six out of 10 participants said they did not know the meaning of #sp (sponsored post) or #ad’.

There is no absolute requirement that advertising, or marketing communication must be labelled. If the relevant audience can make a clear conclusion that the content is commercial in nature, then no further disclosure or distinguishing element is needed.

legal obligations of influencers

What if you are in breach of the code?

A complaint or a breach of the Code can be made to the independent Advertising Standards Bureau. If a dispute is lodged, the bureau’s complaints board must decide whether or not any of the advertising claims disputed are not substantiated. They then provide a case decision to the advertiser with an invitation to produce an Advertiser Statement stating whether the claims will be modified or discontinued. The Board then issues a final case report to the parties after a response has been received, identifying the advertiser, the product, the subject matter involved and the decision. Where an advertiser does not agree to modify or discontinue an advertisement found in contravention of the Code, the Board can also refer the case report to an appropriate government agency and/or forward it to media proprietors. For example, in some instances there could be potential liability under the Competition and Consumer Act 2010 (Cth) for misleading or deceptive conduct, in which case the case report might be referred to the ACCC[1]. The Australian Competition & Consumer Commission (ACCC) is the Federal Government regulator looking after the interests of consumers and competition in the Australian market place. It administers the Competition & Consumer Act 2010 and this Act contains the Australian Consumer Law (ACL) which applies to the commercial practices of any person, company or business in Australia.[2] As mentioned above and important for the influencer industry, the ACL prohibits misleading or deceptive conduct and specific misrepresentations, including testimonials (Sections 18 and 29). Breaches of the ACL are far more serious and court action can be brought against all parties involved in the publishing of a post, including the brand, agency and influencer. For individuals, the penalties for each infringing post can be as much as $220,000 and for company brands up to $1.1 million[3].

What are the 'Grey Areas'?

As with any rules and regulations and with social media platforms developing so quickly there are bound to be some grey areas that haven’t been considered.

When a company sends an influencer a free product in the mail, without any obligation that they post about this product on their social media channels. The AANA’s Code of Ethics says that since the company has no control over whether any promotion occurs following this, if it happens to be posted by the influencer, it is NOT considered advertising or marketing communication.

Another implication is if the post was made during the course of trade or commerce. Because if it is, and the post is likely to mislead the consumer public, it could well still fall under the realms of the ACL.

Are the laws in Australia the same overseas?

This article discusses the law here in Australia and the legislation does vary a bit from country to country. In the US it is worth looking at the Federal Trade Commission (FTC) to stay updated with their disclosure laws. In the US, the rules go so far as to say that influencers must even disclose all free products they talk about.

Is there a checklist for Influencers?

Disclose and label your posts to be transparent and authentic! It is just not worth hiding when you are getting paid to promote a product or market a brand. 

I also think transparency as an influencer builds trust and engagement with your audience. If you are unsure, I would disclose the nature of the agreement with the brand concerned – e.g. ‘Because I believe and use X Brand so much, they just sent me this awesome activewear set to help them promote it and share with you all! #ad’ and tag the brand to make it completely transparent to your audience.

References

[1] http://pointonpartners.com.au/advertisers-beware-social-media-influencers-paid-promote-products-must-disclose-commercial-nature-posts/

[2] https://mumbrella.com.au/brands-agencies-influencers-can-avoid-legal-trouble-comply-new-ad-transparency-rules-424597

[3] https://mumbrella.com.au/brands-agencies-influencers-can-avoid-legal-trouble-comply-new-ad-transparency-rules-424597

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Sophie Benbow

Sophie Benbow is part of the team at Lazarus Legal in Sydney and has a special interest in Social Media law and Intellectual Property. She also has a blog herself and has been exposed to the social media industry. She wants to provide creatives, small businesses, influencers and start ups with current and concise information surrounding their own brand and business.

If you would like to get in touch with Sophie, feel free to contact Sophie and the Lazarus Legal team on info@lazaruslegal.com.au.

Energy drinks – to drink or not to drink that is the question!

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Energy drinks have been reasonably quiet in the media for some time now, so it was only a matter of time before they made their way back into the headlines! Find out more…

They Trade Marked What?

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From song lyrics to colours, to signature poses. Over the years, there have been some unusual and unexpected trade marks that have been both successfully and unsuccessfully registered.

Fast Moving Consumer Goods – Protect Your Brand!

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You may have probably already seen the cheap knock-offs in the dollar store of products that are designed to look a lot like popular culture brands – transforming toys that aren’t quite “Transformers” or “Space Wars” ships and aliens that remind you of a popular movie series.