As social media continues to play a dominant role in advertising and promotion, a recent decision involving Fosters and the Advertising Standards Boards (ABS) has prompted fear into the boardrooms of Australian businesses.
The win by the ABS held that the Facebook site of an advertiser is by definition a ‘marketing communication tool’ due to the fact that the advertiser has a ‘reasonable degree of control and which draws the attention of a segment of the public to a product, in a manner to promote that product’.
In effect, this means that any material posted by the company or a third party, must comply with any legal requirements for example, misrepresentation and the Australian Association of National Advertisers Code of Ethics.
Whilst not a court decision, this outcome is consistent with previous case law.
In the case of ACCC v Allergy Pathway (No. 2)  FCA 74, the Federal Court attributed liability to the company whose Facebook page displayed testimonials made by ‘fans’ which were subsequently held to be misleading. The court held that the company was in contempt of court, because they knew the statements to be false, however decided not to remove them.
From the case law and decisions, it seems that there is emerging authority that any company/business that facilitates comments contrary to the law or ethical standards, will be held liable notwithstanding whether it was published by the company or a non-related individual.
As a free marketing and promotional tool, and one that far outweighs television and radio for particular age groups, businesses should consider control methods they can implement to minimise the chances of an ACCC or ABS action because of a Facebook comment.
It is essential for the success of any business, that considered and professional advise is obtained. Please contact Affinity Lawyers on (07) 5630 688 for personalised business advice.