Business & Economy

South Korea to fine social media influencers for covert advertising

Seoul, Aug 12 (efe-epa).- South Korea will slap hefty fines on social media influencers who do not disclose that they are promoting a product or service in their online content.

The country’s Fair Trade Commission (FTC) on Wednesday announced new guidelines to bring an end to covert advertising on social media platforms, which will come into effect on Sep. 1.

From that day, texts, photos or videos that these South Korean internet celebrities, some with millions of followers, post on social media must clearly specify whether the placement of a brand has been “financially rewarded or intended for promotion,” according to local news agency Yonhap.

Both influencers and companies that fail to comply with the regulations will be punished with fines of up to 2 percent of the turnover generated from that promotion or 500 million won (about $421,500).

The new guidelines specify the size, color and type of font that should be used in messages informing people that a brand or product is being advertised and that there is an agreement between the influencer and the concerned company.

Misleading messages, including those thanking brands, explaining that the product has been tested for a week or stating that it is informational content, all commonly used so far by South Korean influencers for product placement on their sites, will be prohibited.

An FTC spokesperson told Yonhap there will be a grace period before the enforcement of fines until the agency considers that the online community has become familiar with the new regulations.

The measures come after a South Korean influencer, Cham PD, criticized the widespread use of covert advertising practices, especially within his own community, which is dedicated to “mukbang.”

“Mukbang” (meaning “eating” and “broadcast” in Korean) originated a decade ago and is a very popular format in the Asian country.

It usually consists of a live online show where the host consumes large amounts of food while interacting with the audience.

Following Cham PD’s allegations, one mukbang star, Tzuyang, who has more than 2 million followers, announced the closure of his account in the face of criticism.

Data collected by the Korea Consumer Agency between October and November last year showed that out of 582 cases of product placement in 60 popular accounts, only in 30 percent was it indicated that promotion was being done. EFE-EPA

asb/pd/tw

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