A recent ruling of the Appeals Board (in Dutch “CvB”) of the Dutch Advertising Code Foundation deserves special attention of producers/brands/advertisers who work with brand partners.
Extended duty of care
In this ruling, the CvB stressed that the Social Media & Influencer Marketing Advertising Code (in Dutch “RSM”) implies an active duty of care for advertisers and brands to prevent their products from being recommended with inadmissible and misleading claims. Moreover, the CvB stressed that the term “distributor” in the RSM may also include brand partners (as well as content creators, bloggers, vloggers and influencers).
What makes this interesting? In this case, the express aim of the agreement seemed to be to authorize the brand partner to sell the producer’s products on the Dutch market, and the contractual clauses concerning promotion were only incidental to this. But this did not exculpate the producer.
Content with consequences
This case started with an Instagram post in which a brand partner recommended food supplements by means of health claims. These claims were found to be impermissible. The Advertising Code Committee, now followed by the CvB, held that the brand partner qualifies as a distributor in this case, and that the relationship between this brand partner and the producer is a relevant relationship within the meaning of Article 2 (d) RSM. This was the case because the brand partner was receiving sales-based commissions. Hence, the agreement between the producer and the brand partner indirectly induced the latter to advertise the brand. The fact that content creating, for example, is not mentioned expressly in the agreement does not detract from this.
It all starts with prevention (but does not end there)
Another interesting aspect about this ruling is that the CvB referred expressly to, and gave some substance to, the active best efforts obligation from Article 6 RSM. Under this article, advertisers and brands are obliged to require the brand partners working on their instructions to comply with the obligations of the RSM. The advertiser or brand concerned is expected to take rigorous action as soon as any rule is breached. The CvB further considered that preventive measures alone (such as contractual bans, trainings, and providing fact sheets) do not suffice to fulfil this active best efforts obligation. The obligation also (or maybe even especially) includes “taking adequate action against infringing acts”.
Clear warning
This ruling shows that advertisers and brands cannot look away; whoever engages commercially with distributors (which may also include brand partners) bears a shared responsibility for the legitimacy of the content that those distributors post.
Door Noortje van Schuppen en Merel Rondhuis
