Overview
Influencer marketing is now a well-established part of the digital economy, but with its growth comes increasing scrutiny. Regulators, brands, platforms, and the public expect influencers to comply with a range of legal obligations – particularly those concerning advertising, consumer protection, financial promotions, and intellectual property.
Operating in this space means navigating rules set by authorities such as the Advertising Standards Authority (ASA), the Competition and Markets Authority (CMA), and the Financial Conduct Authority (FCA).
Failure to comply with these legal frameworks can result in reputational damage, financial penalties, content takedowns, or even personal liability.
This article outlines common compliance issues and best practice recommendations for influencers and brands engaging in influencer marketing. It is intended for general informational purposes only and does not constitute legal advice.
Advertising Standards & Transparency
Transparency in advertising is a core requirement under both the ASA and CMA’s guidance. Influencers are legally obliged to disclose commercial content clearly and unambiguously. Any post that involves payment, gifted items, or a commercial relationship, such as promoting a brand the influencer owns or has financial interest in, must be identified as advertising.
This disclosure should appear at the beginning of a post, caption, or video, and use terms that leave no room for ambiguity. The ASA recommends label such as #Ad, Advert, or Paid Partnership, which must be prominent and easy to spot. Hiding disclosures in a list of hashtags, buried in comments, or behind expandable captions is not compliant.
Common compliance failures include the use of vague terms such as “#spon”, “#collab”, or “in association with”, which do not meet the standards for clear disclosure. Misleading “native” advertising that appears to be organic content but is in fact sponsored can also attract enforcement action.
Non-compliance with advertising rules may lead to public rulings, removal of posts, damage to relationships with brands, and enforcement action from regulatory bodies.
As influencer marketing continues to professionalise, consistent and transparent disclosure is not only a legal obligation, but a trust-building practice for an influencers’ audience.
Financial Promotions & FCA Compliance
Promoting financial products or services introduces a much higher level of legal risk. This includes content relating to cryptocurrency platforms, trading apps, investment tools, or buy-now-pay-later schemes. Under UK law, such promotions are regulated by the Financial Conduct Authority (FCA). Section 21 FSMA states that a person must not, in the course of business, communicate an invitation or inducement to engage in investment activity unless (i) the financial promotion is communicated by an authorised person, (ii) the content of the promotion is approved by an authorised person, or (iii) an exemption applies. Thus the financial promotions regime applies to both influencers and the firms or companies who engage the influencers as affiliate partners.
If an influencer is not authorised by the FCA, they cannot legally communicate financial promotions unless the content has been pre-approved by a firm authorised to do so. This is a critical point: influencers who post unapproved promotions could be held personally liable, even if acting in good faith or on behalf of a brand. It is also crucial that influencers do not rely on pre-existing FCA authorisation for a separate activity as anyone who is authorised by the FCA, is only authorised for that specific activity.
Influencers will be in breach of section 21 FSMA if they (i) share non-compliant financial promotions, even if approved by an authorised person; or (ii) make unauthorised and illegal promotions. These includes where celebrities which are paid for promoting financial products or other influencers who share recommendations on what to do.
Content relating to financial products must be fair, clear, and not misleading. This includes providing appropriate risk warnings, ensuring accuracy of performance claims, and avoiding exaggerated promises. Paid promotions, referral codes, or affiliate links relating to financial services must be clearly disclosed.
High-risk areas include cryptocurrency promotions, investment recommendations, and any referral activity involving regulated products. Given the heightened regulatory attention in this space, influencers must exercise particular caution when working with fintech or financial brands.
Copyright and Use of Third-Party Content
Under the Copyright, Designs and Patents Act 1988, influencers must respect the rights of content creators and other third parties when using images, music, logos, or videos not created by themselves. Copyright protects original works, including product photos, user-generated content (UGC), and brand materials [refs].
Simply reposting or sharing content without permission, even with attribution, can constitute copyright infringement. Tagging the creator or brand does not provide a legal right to use the material.
To stay compliant, influencers should use their own original content or obtain express permission from the copyright holder. Special care should also be taken when using music, memes, or viral content, as these often involve layered or unclear rights ownership.
Despite the above, there are certain exceptions to copyright that allow individuals to use the work of others without permission, which we can advise on further.
Brand Partnership Contracts
Entering into a commercial agreement with a brand requires careful review of the contract terms. These agreements often include exclusivity clauses, usage rights, payment schedules, and disclosure requirements, all of which can have significant legal and financial implications for influencers.
Exclusivity clauses may restrict the influencer from working with competing brands for a defined period. Usage rights may allow the brand to reuse or repurpose content across different platforms or in perpetuity, which could limit the influencer’s control over their work. Payment terms, including timing, method, and conditions, should be clearly defined to avoid disputes.
Many agreements also include strict disclosure wording that influencers are contractually obligated to use in sponsored content.
Legal advice before signing can help protect intellectual property rights and ensure the influencer is not taking on risk that properly belongs to the brand, particularly around consumer law compliance.
Platform Terms and Content Removal
In addition to legal requirements, influencers must also adhere to the terms of service and community guidelines of the platform they use, which have their own rules regarding acceptable content, advertising, intellectual property, and monetisation.
Breaches can result in serious consequences, including removal of posts, loss of monetisation, account suspension, or permanent bans.
Platform enforcement is often automated or swift, with limited avenues for appeal.
It is therefore essential for influencers to stay informed about changing terms, particularly around branded content tools and use of third-party media.
How We Can Help
Quastels LLP can advise influencers, content creators, talent managers, and brands on a full range of legal and compliance matters within the influencer marketing ecosystem. Our services include reviewing influencer agreements, ensuring regulatory compliance with the ASA, CMA, and the FCA, resolving intellectual property disputes, and developing risk mitigation strategies.
Whether you are launching a campaign, signing a long-term partnership, or facing content takedown, we can provide clear and commercially focused legal advice to help you stay complaint and protect your brand.
To discuss your requirements and find out how we can help you, please get in touch.
