Much has been made recently of the deceptive means utilized to purchase advertising during the 2016 U.S. presidential campaign.  In response, a number of social media platforms have implemented various policies requiring transparent political advertising disclosures.  In fact, Facebook recently announced efforts to ensure that candidates purchasing advertising space verify themselves.  

Generally speaking, digital advertisers are required to make disclosures clear and conspicuous to avoid deception.  Disclosures should be placed in close proximity to the relevant claim.  

The Federal Trade Commission has gone to great lengths to provide specific guidance that takes into account the expanding technological landscape and the rise of social media marketing.  Online marketers should consult with an experienced FTC defense lawyer to discuss agency policy pertaining to prominent disclosures across all devices and platforms used to view advertisements.

On the heels of social media executives testifying before Congress about foreign efforts to interfere in the U.S. election process, California lawmakers are now getting into the act by introducing legislation aimed at political advertisements on social media platforms.  If signed into law, the “Social Media DISCLOSE Act” would regulate online political advertising and become effective January 1, 2020.   

The “Social Media DISCLOSE Act” takes aim at the disclosure requirements in social media political ads by extending rules that apply to other forms of media.  Without limitation, political advertisers, social media platforms and search engines would face various disclosure obligations.  

The Act seeks to build on the existing “California DISCLOSE Act” which was enacted in 2017 to address perceived lax campaign finance disclosure policies.  Amongst other things the 2017 Act established new rules regarding the identification of donors to committees and ballot measures.

The proposed legislation applies to “online platforms,” defined to include websites and digital applications that sell advertising directly to advertisers, but not websites or apps that only display advertisements sold via another platform.  It also applies to political committees that place California political advertisements on online platforms.

In its present form, the bill provides that advertisers would be required to inform online platform providers when a political advertisement is being placed and the name of the advertiser.  Advertisers would also be required identify the issue or candidate being sponsored.

Platforms would need to ensure that all political advertisements properly disclose who paid for them, or a hyperlink, icon or tab with specifically designated text that discloses sponsorship information.  Platform providers would also be required to retain records of digitally disseminated advertisements, the dates of dissemination and total ad impressions.  Importantly, who paid for advertisements and amounts spent thereon would also have to be disclosed.  Platforms would be required to make the foregoing information publicly available and retain related data for no less than four years.

Some exceptions would apply for advertisements that already have associated disclosure obligations.

Assembly Speaker pro Tem Kevin Mullin authored the California DISCLOSE Act in 2017.  “Although AB 249 gave California the strongest campaign finance disclosure law in the country, it may not have been clear that social media platforms are included in last year’s legislation,“ Mullin has stated.