Advertising is regulated in Australia through both legislative and self-regulatory systems.

The primary piece of legislation is the Australian Consumer Law (ACL) (Schedule 2 to the Competition and Consumer Act 2010 (CCA)), which prohibits, among other things, misleading or deceptive conduct (including conduct that is likely to mislead or deceive) and the making of false or misleading representations.

There is also industry and product specific legislation, for example, at a state and territory level.

Food Acts prohibit misleading or deceptive conduct in relation to food advertising, packaging and labelling and also require compliance with the Australia and New Zealand Food Standards Code (FSC). Similarly, the advertising of therapeutic goods must comply with the Therapeutic Goods Advertising Code 2021 (TGAC), which has the force of law. In addition, the Corporations Act 2001 (Corporations Act), the Australian Securities and Investments Commission Act 2001 (ASIC Act) and the National Consumer Credit Protection Act 2009 (incorporating the National Credit Code) all have provisions dealing with misleading or deceptive conduct in relation to advertising of credit and financial products.

Australia's advertising industry self-regulatory system is administered by Ad Standards and is discussed at 1.7 Self-Regulatory Authorities.

The Australian Competition and Consumer Commission (ACCC) is the Federal government regulator for the ACL and it both investigates and enforces contraventions of the ACL (although individuals (corporate or otherwise) may also take, and do take, private actions under the ACL). Fair Trading Offices also investigate and enforce the ACL at the State and Territory level.

There are also industry-specific government departments, such as:

• the State and Territory Food Authorities which administer the FSC;
• the Therapeutic Goods Administration (TGA) which administers the TGAC; and
• the Australian Securities and Investment Commission (ASIC) which regulates legislation applying to the advertising of financial and credit products.

The remedies available to regulators such as the ACCC, ASIC and the TGA include infringement notices, court enforceable undertakings, declarations, injunctions, pecuniary penalties, corrective advertising and compliance programmes.

The advertiser is usually held liable for deceptive advertising, but this can also extend to persons who have aided or abetted, or have been knowingly concerned, in the deceptive advertising and can include individual employees of the advertiser and third parties such as advertising agencies.

There is no definition of “advertising” in the ACL; however, Ad Standards, the organisation responsible for administering Australia's advertising industry self-regulatory system, refers to advertising as a “form of marketing communication that aims to persuade and influence people to take a specific action, like buying a product or using a service”.

Moreover, the Australian Association of National Advertisers (AANA) defines advertising in the AANA Code of Ethics (ACE) as “any material which is published or broadcast using any Medium or any activity which is undertaken by, or on behalf of an advertiser or marketer, over which the advertiser or marketer has a reasonable degree of control, and that draws the attention of the public in a manner calculated to promote or oppose directly or indirectly a product, service, person, organisation or line of conduct”.

Generally, there are no pre-approvals required to be obtained from the government or other authorities before conducting advertising in Australia.

However, advertising on commercial television is required to be classified by ClearAds. ClearAds’ primary role is the classification of advertisements for the purpose of timing placement. Whilst ClearAds also reviews substantiation of claims in advertising, any approval of advertising or otherwise by ClearAds does not guarantee compliance with advertising laws.

Section 122(1)(d) of the Trade Marks Act 1995 provides that a registered trade mark is not infringed if a person uses the trade mark for the purposes of comparative advertising.

Section 67 of the Copyright Act 1968 provides that copyright in an artistic work is not infringed by its incidental inclusion in a film or broadcast (such as a TV advertisement). What is meant by “incidental” is a question of fact; however providing the artistic work in question is not the main or central focus of the film or broadcast, it is more likely to be considered incidental. In addition, the Copyright Act 1968 permits a fair dealing with a copyright work for the purposes of criticism or review and parody or satire.

Regarding the use of an individual’s name, picture, voice or likeness, there is no right of publicity in Australia. However, if the individual has a reputation (for example, a celebrity) and their name, picture, voice or likeness is used in advertising without their permission, then such use may misrepresent an association with the advertiser and/or the advertiser’s products or services and amount to a passing off at common law and/or misleading or deceptive conduct under the ACL.

Ad Standards is the peak national self-regulatory advertising body which administers a number of codes of practice developed by the AANA such as the ACE, the AANA Food and Beverages Code, the AANA Code of Advertising & Marketing Communications to Children, the AANA Environmental Claims Code and the AANA Wagering Advertising & Marketing Communications Code. It also administers the FCAI Voluntary Code of Practice for Motor Vehicle Advertising on behalf of the Federal Chamber of Automotive Industries (FCAI) and the Alcohol Beverages Advertising Code (ABAC) on behalf of the ABAC Scheme.

Ad Standards receives and determines consumer complaints in relation to the AANA codes of practice and the FCAI Voluntary Code of Practice for Motor Vehicle Advertising. Other industry bodies, such as the ABAC Scheme, determine complaints in relation to their own industry codes.

Ad Standards administers its industry codes of practice through the Ad Standards Community Panel (Community Panel) and the Ad Standards Industry Jury (Industry Jury). The former responds to consumer complaints about advertisements alleged to be offensive, violent or sexist, whereas the latter is a form of alternative dispute resolution for competitors where allegations of misleading or deceptive conduct are made.

Whilst self-regulatory codes are only binding on the respective industry group members, advertisers should note that broadcast licensees and operators of certain advertising mediums (including commercial television and radio and subscription services) may only broadcast content which complies with certain self-regulatory codes, including in particular the Commercial Television Code of Practice, the Commercial Radio Code of Practice and the ASTRA Codes of Practice.

Self-regulatory industry codes of practice are binding only on the members of the specific industry group. Generally, compliance with applicable industry codes is incentivised by the potential for adverse publicity if an advertiser does not comply with the determination of a complaint. The ultimate sanction in relation to non-compliance with an industry body code of practice is expulsion as a member by the industry body.

In respect of industry codes of practice administered by Ad Standards, if the Community Panel or Industry Jury (as the case may be) determines that an advertisement does not comply with an industry code, the Community Panel or Industry Jury will request the advertiser to modify or withdraw the advertisement as soon as possible after making a determination. If the advertiser does not do so, Ad Standards may report such failure in a public case report, send the report to relevant media proprietors, publish the report on its website and, if considered appropriate, refer the report to an appropriate government regulator (such as the ACCC).

Consumers have a right of action in respect of alleged contraventions of the ACL. Remedies available for actions commenced by a consumer are the same as those available to competitors.

Consumers can also make complaints to the government regulator (eg, the ACCC). If sufficient complaints are received or if the conduct complained of is likely to result in significant public detriment, the ACCC may decide to investigate the complaint and/or take action against the advertiser. However, the ACCC is under no obligation to investigate a complaint or take action against an advertiser and may decline to do so.

A consumer may also lodge a complaint with the Ad Standards Community Panel about an advertisement which they consider to be offensive, violent or sexist.

Important legal/regulatory trends regarding deceptive advertising in the last 12 months include:

Greenwashing

The ACCC conducted an internet sweep in October 2022 which looked at 247 different businesses and/or brands over eight sectors, namely energy; motor vehicles; electronics and home appliances; textiles, garments and shoes; household and cleaning products; food and beverages; cosmetics and personal care; and takeaway packaging. The aim of the sweep was to identify industries or sectors which commonly use environmental and sustainability claims, and to assess whether these claims have the potential to mislead consumers.

The sweep identified the following issues:

• vague and unqualified claims;
• a lack of substantiating information;
• use of absolute claims;
• use of comparisons;
• exaggerating benefits or omitting relevant information;
• use of aspirational claims, with little information on how these goals will be achieved;
• use of third party certifications; and
• use of images that appear to be “trust marks”.

The ACCC has since been investigating a number of businesses during 2023 to determine whether the various environmental claims being made by these businesses breach the ACL.

In the meantime, the ACCC published in July 2023 a draft guide for businesses in respect of environmental and sustainability claims and has sought submissions by businesses in response to the draft guide.

Social media influencers

The ACCC conducted an internet sweep in January 2023 to identify misleading testimonials and endorsements by social media influencers. The sectors that were targeted during the sweep were those sectors where influencer marketing is particularly widespread including:

• fashion;
• beauty and cosmetics;
• food and beverage;
• travel;
• health, fitness and wellbeing;
• parenting;
• gaming; and
• technology.

In April 2023, the ACCC published its sixth interim report in respect of the Digital Platforms Services Inquiry which focused on social media services. In relation to social media influencers, the ACCC found that the disclosure of sponsored posts by influencers needs to be improved and that “lack of disclosure may lead consumers who may be unaware that endorsements by influencers are paid for, preventing them from making informed choices when purchasing products online.”

Cultural sensitivity and care should be taken by advertisers when seeking to depict indigenous Australians in advertising, so as not to offend their religious and cultural beliefs. Whilst there is no legislation in Australia which specifically regulates the depiction of Aboriginal people, such matters should be treated with special care in Australia.

In May 2022, a federal general election was held which resulted in a new Australian (Labor) Government. The election of a new Australian government has not impacted the regulation of advertising and/or enforcement of advertising regulations.

Interestingly though, there is currently no legal requirement at the federal level in Australia that the content of a political advertisement must be factually correct or truthful. At the state and territory level, only South Australia and the Australian Capital Territory have enacted such laws. Following the election, consideration is currently underway for the introduction of measures to govern truth in political advertising.

The ACL is the main piece of legislation which governs advertising claims. Its provisions have wide scope and prohibit misleading or deceptive conduct (or conduct that is likely to mislead or deceive) in trade or commerce, as well as the making of false or misleading representations in connection with the supply, possible supply, promotion of supply or use of goods or services, including (but not limited to) in relation to:

• the standard, quality, value or grade of goods or services;
• sponsorship, approval or affiliation;
• testimonials; and
• the existence, exclusion or effect of any condition, warranty, guarantee, right or remedy.

The standard that is applied in determining whether an advertising claim is misleading or deceptive (or is likely to mislead or deceive) is whether, in the context of the advertising claim, ordinary and reasonable persons of the class of persons to whom the advertising claim is directed are likely to be misled or deceived. The intention of the advertiser is irrelevant.

The advertising claim, when considered in context, must lead, or be likely to lead, a person into error. Mere confusion or wonderment is insufficient.

In determining whether the advertising claim is likely to mislead or deceive, the question is whether there is a “real or not remote chance or possibility regardless of whether it is less or more than fifty per cent,” that an ordinary and reasonable person in the circumstances would be misled or deceived.

Any advertising claim that is capable of substantiation, whether express or implied, will be subject to regulation.

That said, some types of advertising claims do not require substantiation, eg, puffery. Whether or not an advertising claim will require substantiation will depend on all of the facts and circumstances of the particular case, and a certain degree of “puffing” or exaggeration is generally accepted in the ordinary course of commercial dealings.

Generally, claims which are capable of objective assessment or comparative claims will require substantiation, as these types of claims have a greater likelihood of being misleading if incorrect, in comparison to clearly fanciful or non-comparative claims.

There are no specified standards as to the type of proof necessary to substantiate an advertising claim. However, evidence should be robust, credible and able to resist objective scrutiny.

There are no specific provisions addressing the use of product demonstrations in advertising. However, the general provisions under the ACL apply. That is, the depiction or use of product demonstrations should not be misleading or deceptive or likely to mislead or deceive.

The ACL specifically prohibits, in trade or commerce, in connection with the supply or possible supply of goods or services or in connection with the promotion by any means of the supply or use of goods or services, the making of:

• a false or misleading representation that purports to be a testimonial by any person relating to goods or services; and
• a false or misleading representation concerning:
1. a testimonial by any person relating to goods or services; or
2. a representation that purports to be such a testimonial relating to goods or services.

In light of the above, testimonials should be genuine and legitimate, and reflect typical cases and the actual experience of the individual giving the testimonial. In general, it is recommended that the advertiser should obtain permission from the individual to use the testimonial, and a signed record of the testimonial should be retained for substantiation purposes.

Where a claim can be substantiated by evidence, the evidence need not be disclosed in the advertisement unless to omit the information would result in the advertisement being misleading or deceptive. However, advertisers must be careful not to hide advertising material within other content, and, where it is not necessarily clear whether content is sponsored or part of a paid ad campaign, it must be clearly labelled as such.

Disclosures by way of disclaimers in superscript in a television commercial, statements at the end of radio commercials, or footnotes in print advertising may be necessary if, without the disclaimer, the overall impression of the advertisement would be regarded as misleading or deceptive. If this is the case, advertisers should also consider whether the placement, size and prominence of the disclaimer are sufficient enough to be effective.

Whether a disclaimer is in fact an effective means of correcting an otherwise misleading impression, or false and misleading representation, will depend on the specific circumstances of the advertisement and the overall impression created by the advertisement which is likely to be understood by an ordinary and reasonable person of the target audience. If the initial impression of an advertisement is overwhelmingly misleading, any disclaimer may not be sufficient to overcome that initial misleading impression.

In Australia, various pieces of federal and state or territory anti-discrimination legislation prohibit various forms of discrimination on the basis of defined grounds, characteristics and/or attributes. “Discrimination” can be “direct” (less favourable treatment) or “indirect” (factually neutral requirements that disadvantage people because of a protected attribute). The protected attributes generally include race, colour, ethnicity, national origin, gender, sexuality, age, disability, marital status, family/carer’s responsibilities, pregnancy, religion, political opinion and social origin.

The federal legislation includes the Racial Discrimination Act 1975, the Sex Discrimination Act 1984, the Disability Discrimination Act 1992, the Age Discrimination Act 2004 and the Australian Human Rights Commission Act 1986. The state or territory legislation is variously entitled the Anti-Discrimination Act, the Discrimination Act or the Equal Opportunity Act.

In addition to prohibiting discrimination in various contexts including employment/work, the provision of goods and services and accommodation, some of the laws also prohibit “vilification”, which is defined as a public act that “humiliates, intimidates, incites hatred, contempt or ridicule” as well as advertising in particular ways, namely the publication or displaying of advertisements that indicates, or could reasonably be understood to indicate, an intention to discriminate.

In addition, the ACE states that “Advertising shall not portray people or depict material in a way which discriminates against or vilifies a person or section of the community on account of race, ethnicity, nationality, gender, age, sexual orientation, religion, disability, mental illness or political belief”. The term “discrimination” is defined to mean “unfair or less favourable treatment” and the term “vilification” is defined to mean “humiliates, intimidates, incites hatred, contempt or ridicule”. An advertisement can humorously or satirically suggest stereotypical aspects of a group of people in society provided the overall impression of the advertisement does not convey a negative impression of people of that group on the basis of one or more of the attributes specified above.

Australia regulates environmental claims in advertisements in two ways.

• Firstly, the AANA Environmental Claims Code is a self-regulatory code of practice administered by Ad Standards that regulates the making of “Environmental Claims” in advertisements. The term “Environmental Claim” is defined to mean “any express or implied representation that an aspect of a product or service as a whole, or a component or packaging of, or a quality relating to, a product or service, interacts with or influences (or has the capacity to interact with or influence) the Environment”. Generally, the Code requires Environmental Claims to be presented truthfully and factually, provide a genuine benefit to the Environment and be capable of substantiation.
• Secondly, the provisions of the ACL prohibiting conduct that is misleading or deceptive (or is likely to mislead of deceive) and/or the making of false or misleading representations apply equally to environmental claims, or “greenwashing”. As noted in 1.9 Regulatory and Legal Trends, in July 2023 the ACCC published a draft guide for businesses in respect of environmental and sustainability claims. The draft guide sets out eight principles for “trustworthy environmental claims”.

The ACCC is currently considering the use of dark patterns on digital platforms as part of its general enforcement and compliance priorities for 2022-23 and its Digital Platform Services Inquiry 2020-25.

In the fifth interim report for the Digital Platform Services Inquiry, the ACCC commented how existing prohibitions in the ACL may deal with some types of dark patterns. However, many dark patterns would fall outside existing prohibitions.

The ACCC strongly supports the introduction of a general prohibition on unfair trading practices into the ACL which will help capture the use of “harmful” dark patterns. Government consideration of this is currently underway. Alternatively, the ACCC has recommended further consideration be given to specific measures designed to regulate the use of dark patterns on digital platforms.

In addition, the 2023 Privacy Act Review Report (Privacy Act Review Report) considered the use of dark patterns which encourage users to select “more privacy intrusive settings” and “detracts from the effectiveness of consent”. To address this, the Office of the Australian Information Commissioner (OAIC) has recommended that the definition of consent (for the collection, use or disclosure of personal information) be amended to provide that consent must be voluntary, informed, current, specific and unambiguous.

The Broadcasting Services (Australian Content and Children's Television) Standards 2020 (Standard) prohibits broadcasters from broadcasting TV advertisements that mislead or deceive children, put undue pressure on children to purchase products, or are unclear in the presentation of the product. The Standard also contains specific requirements regarding the use of disclaimers and references to premium offers and competitions in TV advertisements to children. In addition, the Standard prohibits the broadcast of TV advertisements during preschool classified programmes and restricts the broadcasting of TV advertisements during C classified programmes. The Standard also prohibits the broadcast of TV advertisements to children that demean persons on the basis of race, nationality, ethnicity, gender, sexual preference, religion or mental or physical disability; or show images or events that are unduly frightening or distressing to children or show unsafe uses of a product.

Further, the AANA Code for Advertising & Marketing Communications to Children is a self-regulatory code of practice that regulates the content of advertisements directed primarily at children. “Children” refers to persons that are 14 years old or younger. The Code contains an over-arching requirement that advertisements primarily directed at children must not contravene “Prevailing Community Standards” and contains specific restrictive provisions or prohibitions in relation to the factual presentation of advertisements, placement, sexualisation, safety, social values, parental authority, qualifying statements, competitions, popular personalities, premiums, alcohol, privacy and food and beverages.

Section 2.7 of the ACE requires that advertising must be clearly distinguishable as such.

Advertisers should be careful not to conceal advertising material within other content and where it is not readily apparent that such content is sponsored or part of a commercial arrangement, it must be clearly labelled as such. The ACE Practice Note provides further guidance for ensuring advertising content is clearly distinguishable from non-advertising content.

Other industry codes, such as the Commercial Television Industry Code of Practice and the Media Entertainment & Arts Alliance (MEAA) Journalist Code of Ethics, require the disclosure of commercial arrangements. Further, the Commercial Radio Code of Practice requires an advertisement to be presented in a manner which is clearly identifiable as advertising material.

In addition to the above, the usual ACL provisions apply, including in respect of conduct that is misleading or deceptive and false or misleading representations.

Claims about where a product’s ingredients or components came from or where it was processed are “country of origin” claims and are regulated under the misleading or deceptive conduct and/or false and misleading representations provisions of the ACL. Country of origin claims include claims that a product was “made”, “produced” or “grown” in a certain country.

“Made in” claims refer to the production of the product – that is, the goods must have been substantially transformed in the country of origin being claimed. “Product of” claims are used to demonstrate that each significant component or ingredient of the goods originated in the country and the production processes took place in the country. “Grown in” claims are used to demonstrate that each significant ingredient or significant component was grown in the country of the claim and the production or manufacturing processes occurred in that country.

In addition, food offered for retail sale in Australia is required to carry country of origin labelling under the Country of Origin Food Labelling Information Standard 2016 (Information Standard), made under the ACL. The Information Standard aims to make it easier for consumers to see where their food originates from.

Use of the term “free” in advertising is specifically referred to in the ACCC’s Advertising and Selling Guide and the ACCC warns that businesses should be particularly careful of the use of the word “free”. This is especially so, as consumers will usually think of “free” as meaning absolutely free.

Whilst there are no specific rules or restrictions that apply to comparative advertising claims, special care should be taken when making comparative claims. This is because generally comparative claims are more likely to mislead or deceive if the comparison is inaccurate as opposed to non-comparative claims, and because comparative claims are more likely to be scrutinised by a competitor.

As noted in 1.6 Intellectual Property and Publicity Rights, Section 122(1)(d) of the Trade Marks Act 1995 provides that a registered trade mark is not infringed if a person uses the trade mark for the purposes of comparative advertising. Accordingly, under the Trade Marks Act 1995, it is permissible to use a competitor's trade mark in a comparative advertisement.

On the other hand, if the trade mark is a logo and constitutes an artistic work, no such comparative advertising exception exists under the Copyright Act 1968. However, as noted in 1.6 Intellectual Property and Publicity Rights, Section 67 of the Copyright Act 1968 provides that copyright in an artistic work is not infringed by its incidental inclusion in a film or broadcast (such as a TV advertisement). What is meant by “incidental” is a question of fact; however, providing the artistic work in question is not the main or central focus of the film or broadcast, it is more likely to be considered incidental. Accordingly, if the competitor’s logo, or other artistic works that may appear on the competitor’s product packaging, is incidentally included in a TV advertisement, such inclusion may not amount to an infringement of the competitor’s copyright. That said, in the context of a comparative TV advertisement, where the main or central focus of the advertisement is a comparison between the advertiser’s product and the competitor’s product, it is difficult to envisage a situation where the inclusion of the competitor’s logo or other artistic works is not part of the main or central focus of the TV advertisement.

An advertiser can challenge claims made by a competitor, either through the courts or via the alternative dispute resolution process provided by Ad Standards’ Industry Jury.

If an advertiser challenges a competitor’s claim through the courts, then an advertiser will generally seek an urgent court hearing seeking a declaration that the claim is likely to mislead or deceive under the ACL and an interlocutory injunction to prevent the competitor from continuing to make the claim pending a final hearing of the matter at a later date. The advertiser will also usually seek damages and legal costs. As a court order is legally binding, failure by the competitor to abide by a court’s order is likely to amount to contempt of court.

If the advertiser chooses to challenge the competitor’s claim via the alternative dispute resolution process provided by Ad Standards’ Industry Jury, then the advertiser will submit a complaint against the competitor’s claim under Section 1 of the ACE. If the Industry Jury upholds the complaint, the competitor will be requested to modify or withdraw the advertisement containing the claim. If the competitor does not do so, Ad Standards may report such failure in a public case report, send the report to relevant media proprietors, publish the report on its website and, if considered appropriate, refer the report to an appropriate government regulator (such as the ACCC).

If an advertiser is seeking to urgently stop a competitor from making a claim, or continuing to make a claim, then commencing court proceedings and obtaining a court order to that effect would be the more appropriate course of action.

In Australia, there is specific ambush marketing legislation that applies in certain circumstances.

• The Olympic Insignia Protection Act 1987 (Cth) prohibits all unauthorised commercial use of the word OLYMPIC and other Olympic expressions.
• Event-specific legislation is often enacted for major sporting events. For example, the Sydney 2000 Games (Indicia and Images) Protection Act 1996 (now repealed) prohibited the unauthorised use of Sydney 2000 games indicia or images for commercial purposes. The Explanatory Memorandum emphasised that the purpose of the Act was to preserve the financial integrity of the games which could be adversely affected by ambush marketing. Similar legislation has been enacted in respect of the Melbourne 2006 Commonwealth Games and the Grand Prix.

• At a federal level, the Major Sporting Events (Indicia and Images) Protection Act 2014 (Cth) provides that a person cannot use a major sporting event’s protected indicia or images for commercial purposes during the event’s protection period, unless the person is an official user for the event. The list of major sporting events which are protected by the Act is updated regularly.
• Major events legislation in many Australian states and territories also prohibits the unauthorised commercial use of official insignia and advertising visible from event venues (including aerial advertising) to assist with the prevention of ambush marketing.

In addition to the above, the usual ACL provisions apply, including in respect of conduct that is misleading or deceptive and false or misleading representations about sponsorship, approval or affiliation. Also, victims of ambush marketing can seek redress through the common law tort of passing off.

There are no special rules or regulations that apply to advertising online or on social media. The provisions of the ACL and the various AANA and other industry codes of practice apply equally in the online and social media space.

In addition, the Digital Industry Group Inc.’s (DIGI) Australian Code of Practice on Disinformation and Misinformation (updated 22 December 2022) requires its digital platform signatories (including Apple, Adobe, Google, Meta, Microsoft, Redbubble, TikTok and Twitter) who offer digital advertising services to use commercially reasonable efforts to deter advertisers from repeatedly placing digital advertisements that contain verifiably false or misleading or deceptive information. 

In Australia, advertisers have been held liable (and will continue to be held liable) for user-generated content that has been posted on advertisers’ websites or social media pages where such content consists of misleading or deceptive testimonials or false or misleading representations where the advertisers were aware of the content (or should have been aware) and did not remove it, or did not remove it promptly.

The disclosure requirements that apply to advertisements in the online and social media space are no different than traditional forms of media. See 2.6 Disclosures.

Of particular note, however, is the current concern with social media influencers not disclosing, or not appropriately disclosing, their commercial arrangements with advertisers as is required under the “Clearly Distinguishable Advertising” requirement of the ACE. Such conduct can also amount to misleading or deceptive conduct under the ACL.

Subject to DIGI’s Australian Code of Practice on Disinformation and Misinformation (see 4.1 Disclosure Requirements), there are no special requirements in relation to the use of social media platforms in Australia, nor are there any social media platforms that are not permitted to be used in Australia.

There are no special rules that apply to native advertising in Australia.

The same requirements regarding “Clearly Distinguishable Advertising” under the ACE and the misleading or deceptive conduct provisions under the ACL apply equally to native advertising.

Accordingly, it is incumbent on an advertiser to ensure that native advertising clearly and prominently discloses that the content is a paid advertisement for the advertiser as opposed to editorial or entertainment content.

There are no special rules or regulations that apply to the use of influencer campaigns. The provisions of the ACL and the various AANA and other industry codes of practice apply equally to influencer campaigns. That said, the current concern with social media influencers not disclosing, or not appropriately disclosing, their commercial arrangements with advertisers as is required under the “Clearly Distinguishable Advertising” requirement of the ACE has given greater prominence to that requirement. Such conduct can also amount to misleading or deceptive conduct under the ACL.

In addition, the Australian Influencer Marketing Council’s (AiMCO) Australian Influencer Marketing Code of Practice (11 August 2021) sets out best practice disclosure requirements in respect of influencer marketing which reiterates both the “Clearly Distinguishable Advertising” requirement of the ACE and compliance with the misleading or deceptive conduct provisions of the ACL.

Under the ACE, an advertiser can be held liable for the content posted by its influencers provided that the advertiser has a reasonable degree of control over the content that the influencers post.

As an influencer, or an advertiser, has yet to be sued by a regulator (such as the ACCC) for engaging in misleading or deceptive conduct under the ACL in respect of content posted by an influencer, it is not entirely clear whether an advertiser would be held liable for that content. However, if the advertiser was aware of the content (or should have been aware) and took no steps to have the content removed or amended (so that it was no longer misleading or deceptive), is possible that an advertiser could be held liable for that content. Accordingly, advertisers should actively monitor their influencers’ posted content (as they are required to do in respect of content posted on their own websites).

There are no special rules or regulations that apply to the solicitation and use of consumer reviews. The provisions of the ACL apply equally to the solicitation and use of consumer reviews as they do to any other conduct in trade or commerce. Specifically though, the testimonial provisions specified in 2.5 Endorsements and Testimonials apply to the solicitation and use of consumer rules.

Essentially, the creation by an advertiser of fake or misleading consumer reviews, and/or arranging for others to create fake or misleading consumer reviews, will contravene the above provisions as well as amount to misleading or deceptive conduct under the ACL.

In addition, the manipulation of negative consumer reviews by an advertiser, such as suppressing, editing or removing negative consumer reviews, may also amount to misleading or deceptive conduct under the ACL.

Further, advertisers who offer incentives for customers to write positive consumer reviews and do not disclose the incentive also risk engaging in misleading or deceptive conduct in contravention of the ACL.

It is possible that an advertiser who has formed a view that a customer review is false or misleading and does not take steps to remove the review, or have the review removed (if it is on a third party site or platform), may itself be held liable for engaging in misleading or deceptive conduct under the ACL.

However, advertisers must be careful to ensure that they have a proper basis for forming a view that a customer review is misleading or deceptive before removing it or requesting it to be removed, as removing or requesting the removal of a customer review that was genuinely created may also amount to misleading or deceptive conduct under the ACL.

Email marketing is regulated by the Spam Act 2003 (Cth) (Spam Act).

The Spam Act provides that commercial electronic messages (where the purpose of the message is to offer, advertise or promote the supply of goods or services) with an “Australian link” requires:

• the express or inferred consent of the recipient;
• information about the individual or organisation who authorised the sending of the message; and
• a functional unsubscribe facility.

An “Australian link” includes any message that originates in Australia, where the sender is present in Australia or where the recipient is in Australia.

Failure to comply with these obligations can result in substantial penalties and injunctions. The Australian Communications and Media Authority recently issued an infringement notice which required the Commonwealth Bank of Australia to pay a penalty of AUD3,552,000 for breaching the Spam Act by sending commercial electronic messages without consent and a functional unsubscribe facility.

Proposal 20.2 of the Privacy Act Review Report recommends the introduction of an unqualified right for individuals to opt-out of their personal information being used or disclosed for direct marketing purposes.

The Do Not Call Register Act 2006 (Cth) (DNCRA) prohibits the making of unsolicited telemarketing calls to a telephone number registered on the Do Not Call Register, unless the account holder of the telephone number has consented to receiving the call.

The Do Not Call Register is a database where individuals can register their numbers to opt out of most unsolicited telemarketing calls.

A business must crosscheck its marketing lists against the Do Not Call Register to ensure that it does not call those numbers. If a business outsources telemarketing calls, both the business and the service provider are responsible for complying with the DNCRA.

Failure to comply with these obligations can result in substantial penalties and injunctions. Infringement notice penalties range up to AUD313,000 for each day on which contraventions occurred. A court may award significantly higher penalties, with a maximum penalty of AUD3,130,000 for each day on which contraventions occurred.

Text messages are also regarded as “commercial electronic messages” and are subject to the same regulations as emails under the Spam Act. See 6.1 Email Marketing.

The Privacy Act does not apply to advertisers targeting consumers using information which is not about an identified individual, or an individual who is reasonably identifiable. Interest-based advertising is conducted by collecting web browsing activities and linking this to certain non-identifying information, such as an IP address, in order to direct targeted adverts to web pages visited by the user of that IP address. Accordingly, no personal information is being collected, used or disclosed and the Privacy Act does not apply.

Importantly, even if the information used by advertisers does not constitute “personal information” on its own, if it can be connected with other information held by the business (even if it is stored separately), or a related entity, or is reasonably accessible based on the “motivated intruder” test, to the extent that, when connected, it is capable of identifying an individual, then it must be treated as personal information and the Privacy Act will apply. Accordingly, the more information that is collected, the easier it becomes to identify an individual and the more likely it is that the Privacy Act will apply.

The Australian Best Practice Guideline for Online Behavioural Advertising sets out self-regulatory principles for interest-based advertising and aims to promote transparency and consumer awareness and to encourage best practice and accountability.

Further, the Privacy Act Review Report contains a number of proposals that would give individuals more control and transparency in respect of direct marketing, targeting and trading of their personal information.

The Privacy Act does not contain any special rules that apply to the collection or use of personal information from children. For consent to be valid, an individual must have capacity to consent.

Guidance provided by the OAIC indicates that a business must decide if an individual under the age of 18 has the capacity to consent on a case-by-case basis. If it is not practical to do so, a business may assume an individual over the age of 15 has capacity, unless there is something to indicate otherwise.

The Privacy Act Review Report contains a number of proposals that would introduce child-specific protections into the Privacy Act.

The OAIC has a number of enforcement powers to deal with breaches of the Privacy Act, including powers to:

• accept an enforceable undertaking;
• make a determination;
• seek an injunction; or
• apply to the court for a civil penalty order. The maximum penalty for serious or repeated privacy breaches is the greater of:
1. AUD50 million;
2. three times the value of any benefit obtained through the misuse of information; or
3. 30% of the company’s adjusted turnover in the relevant period.

Under Australian Privacy Principle 7, an organisation must not use or disclose personal information it holds for the purpose of direct marketing to an individual unless the individual reasonably expects it, or consents to it, and there is a simple “opt out” process by which an individual can elect not to receive direct marketing communications.

Australian Privacy Principle 7 does not apply in circumstances where the Spam Act or DNCRA applies.

Sweepstakes (called trade promotion lotteries or games of chance in Australia) and contests (games of skill) are regulated at the state and territory level, although overarching federal legislation, such as the misleading or deceptive conduct provisions of the ACL and the provisions of the Privacy Act, also applies to the conduct of trade promotion lotteries and games of skill.

Each state and territory has enacted specific legislation in relation to the conduct of trade promotion lotteries. No specific legislation exists in relation to the conduct of games of skill.

Of the eight states and territories, four require either a permit, licence or authority to be obtained in order to conduct a trade promotion lottery in their respective jurisdiction, depending on the value of the total prize pool of the trade promotion lottery. Those four states and territories and their respective threshold total prize pools are as follows:

• New South Wales (NSW) – more than AUD10,000;
• South Australia (SA) – more than AUD5,000;
• Northern Territory (NT) – more than AUD5,000; and
• Australian Capital Territory (ACT) – more than AUD3,000.

If the value of a trade promotion lottery’s total prize pool is less than the threshold amounts mentioned above, then a permit, licence or authority is not required in that state or territory. Further, the NT does not require a permit to be obtained if another state or territory has already issued a permit. Accordingly, an NT permit is usually not obtained in respect of an Australia-wide trade promotion lottery where a permit, licence or authority has been issued in either NSW, SA or ACT.

Irrespective of whether a permit, licence or authority is required in respect of a trade promotion lottery, the sponsor or promoter of a trade promotion lottery is required to comply with each state and territory’s legislative and lottery office requirements in relation to the conduct of a trade promotion lottery in each state and territory’s jurisdiction. Entry to a trade promotion lottery must be free, but proof of purchase of a good or service as a condition of entry is permissible.

Games of skill do not require a permit, licence or authority.

A trade promotion will be regarded as a trade promotion lottery if there is any element of chance in the determination of the winner. Mixed games of chance and games of skill will be regarded as a trade promotion lottery.

A game of skill is where there is no element of chance in the determination of the winner and the winner is selected from the set of criteria that is set out in the rules of the game.

Depending on the total value of the prize pool, games of chance may require a permit, licence or authority in the various states and territories mentioned in 7.1 Sweepstakes and Contests in order to be lawfully conducted in those states and territories.

Generally, permits, licences or authorities are obtained from the respective state or territory's Fair Trading Office or Department of Gambling and Racing. 

See 2.12 Other Regulated Claims in relation to the use of the term “free” generally. In addition, the ACL specifically prohibits the offering of any rebate, gift, prize or other free item with the intention of not providing it, or of not providing it as offered. The rebate, gift, prize or other free item must also be provided within the time specified in the offer, or if no time is specified, within a reasonable time after making the offer.

In relation to reduced-price offers or what is commonly referred to as “was/now” claims, goods or services offered must have been offered at the “was” price for a reasonable period of time before advertising the “now” price. The “was” price must also be the realistic former sale price which may not necessarily be the same as the ticketed price.

Depending on the circumstances, automatic renewal/continuous service offers in a consumer contract or small business contract may amount to an unfair contract term (UCT) under the ACL. A term is unfair if it:

• would cause a significant imbalance in the parties’ rights and obligations arising under the contract;
• is not reasonably necessary in order to protect the legitimate interests of the party who would be advantaged by the term; and
• would cause detriment (whether financial or otherwise) to a party if it were to be applied or relied on.

The ACCC considers that automatic renewal clauses are not necessarily unfair, but are concerning when:

• they are not adequately disclosed;
• no notice is provided that a contract is about to renew;
• the publisher can change the cut-off date for cancellation of the renewal; or
• the customer will incur large early termination charges if they cancel after the contract has automatically renewed.

As UCTs are an ACCC enforcement priority, automatic renewal clauses that do not heed the ACCC’s concern are likely to be regarded as unfair.

Australia is yet to introduce any AI-specific legislation. The current regulation of AI relies on the following:

• general regulations (such as the ACL, privacy law, online safety law, intellectual property law and common law of tort);
• industry-specific regulations (such as food, therapeutic goods and financial services); and
• voluntary or self-regulatory frameworks such as Australia's eight Artificial Intelligence Ethics Principles which are designed to provide guidance to businesses designing, developing and implementing AI.

In June 2023, the Federal Department of Industry, Science and Resources published a discussion paper titled Safe and Responsible AI in Australia. The paper seeks industry views as to the opportunities and challenges presented by AI and whether further regulation is required to manage the potential risks of AI.

As noted in 8.1 AI & Advertising Content, existing prohibitions under the ACL, such as misleading or deceptive conduct, or false representations as to the performance characteristics, uses or benefits of a product, will extend to the promotion of AI products or products that use AI.

When making AI-related claims, a business should ensure that:

• any claims are truthful, accurate and capable of substantiation; and
• it does not exaggerate the characteristics, uses or benefits of the product.

Until any AI-specific legislation is introduced, the use of chatbots should comply with existing regulations, including ensuring that:

• any content generated by a chatbot is truthful and accurate;
• any personal information is handled in accordance with the Privacy Act;
• any content generated by a chatbot does not infringe third party intellectual property rights; and
• any advertising material generated by a chatbot does not inadvertently breach the ACL and/or the advertising provisions of the various self-regulatory codes of practice.

If a crypto-asset (such as cryptocurrencies and NFTs) is a financial product, then it will be subject to the usual Australian regulations that relate to the advertising, marketing and sale of financial products pursuant to the Corporations Act and the ASIC Act, as well as the requirement to hold an Australian Financial Services (AFS) licence.

If the crypto-asset is not a financial product, the misleading or deceptive conduct provisions of the ACL will apply equally to the advertising, marketing and sale of the crypto-asset (as it would in relation to any other good or service).

Interestingly, where a trade promotion lottery requires a permit in the ACT, the ACT Gambling and Racing Commission will refuse to approve an application for a permit where a prize in the promotion consists of a cryptocurrency or an NFT.

There are no specific Australian laws or regulations that apply to advertising within the metaverse. However, existing laws such as the ACL and the Privacy Act may extend to the metaverse.

On 26 September 2022, the Australian Senate referred an inquiry into the Influence of International Digital Platforms to the Senate Economics References Committee. The inquiry will consider:

• issues with the metaverse and whether it is necessary to begin regulating the metaverse now, or if authorities should wait in order to better understand how it will function;
• what regulatory frameworks are required both internationally and in individual jurisdictions to address the risks associated with the metaverse; and
• how any regulatory frameworks encompassing the metaverse would be enforced.

In addition, Standards Australia has published its Metaverse and Standards Whitepaper, which was produced in collaboration with the Responsible Metaverse Alliance. The whitepaper encourages policymakers to explore unique regulations that guarantee basic “Immersive Rights” for consumers which (among other things) would require all promotional material and spokespeople to be visually and audibly distinct and would prohibit all emotional profiling.

As noted in 1.1 Primary Laws and Regulation, there are specific rules and restrictions that apply to the advertisement of various products including the following:

• Food advertising must comply with the FSC, which regulates issues in respect of the use of health, nutritional and advertising claims in advertisements and on packaging/labelling. There are also various self-regulatory industry codes that deal with food and beverage advertising to children and fast food advertising directed at children.
• Therapeutic goods advertising is subject to the TGAC, which prohibits (amongst other things) misleading advertising, advertising which arouses unwarranted expectations or causes consumers to self-diagnose, the offering of incentives to sales staff and the offering of samples. The TGAC also deals with the use of testimonials, professional recommendations, scientific information and comparative advertisements. The TGAC also prescribes wording which must be used in advertisements.
• The advertising of firearms and alcohol is also highly regulated. The ABAC is a self-regulatory code of conduct which also addresses the packaging and advertising of alcohol.
• Tobacco advertising is banned in Australia and labelling and packaging is also highly regulated under the Tobacco Plain Packaging Act 2011.

From an advertising regulation perspective, there are no special rules in relation to product placement in entertainment content. As with any other form of conduct in trade or commerce, product placement is still subject to the misleading or deceptive conduct provisions of the ACL.

In relation to the ACE’s requirement that advertising must be clearly distinguishable as such, the AANA’s practice note acknowledges that where advertisers have made commercial arrangements for their branded product to feature as a product placement, no disclosure may be required. This is because the use of the branded product may be sufficient to distinguish the material as an advertisement and/or there is a prevailing community view that audiences do not need to be notified of this sort of product placement.

In addition to the products identified in 10.1 Regulated Products, there are also rules and restrictions that apply in relation to the advertisement of the following products and services.

• Advertising of financial and credit products is subject to the Corporations Act, the ASIC Act and the National Credit Code. The legislation generally prohibits misleading or deceptive conduct and is supported by ASIC’s regulatory compliance guide (RG 234), which details what is expected in relation to disclaimers, advertising of returns, benefits and risks, comparisons, use of forecasts and information about fees, and media-specific related matters.
• The advertising of gambling is highly regulated. The Interactive Gambling Act 2001 regulates the advertising of gambling services via online, a website, an app or a telephone. In May 2023, the Federal Government introduced the Broadcasting Services Amendment (Prohibition of Gambling Advertisements) Bill 2023 which seeks to amend the Broadcasting Services Act 1992 to prohibit the broadcasting of gambling advertisements on certain television and radio broadcasting services and prohibit the provision of gambling advertisements on certain online content services.
• The Telecommunications Consumer Protections Code contains rules about the advertisement of telecommunications products and services. These include general rules about what information must and must not be included in advertisements.
• The advertising of health services provided by health practitioners is subject to the Health Practitioner Regulation National Law 2009(National Law) which prohibits (among other things) misleading or deceptive conduct, the use of testimonials, creating unreasonable expectations and encouraging the indiscriminate or unnecessary use of health services. Since 1 July 2023, new Guidelines for registered medical practitioners who advertise cosmetic surgery (Guidelines) have come into effect and the Guidelines regulate in detail how cosmetic surgery can be advertised.