Consumer Protection Law and Influencers

Hiding Payments? You're at Risk

If you're like many people who share their personal experiences on social media, you might know the case of Yael Bar-Zohar and Shai Mika. They shared an interview about ostensibly authentic experiences, but it turned out to be sponsored content not properly marked. As a result, they and all other involved parties were exposed to a class-action lawsuit. This issue is not unique to this case. Kim Kardashian also had to pay a $1.2 million fine after failing to disclose the payment she received for promoting cryptocurrency. She thought saying "this is not financial advice" was enough, but it wasn't.

The most important point is that hiding payment for recommendations on social media is not only a violation of the Consumer Protection Law but also exposes you to personal lawsuits.

What Do Courts Actually Consider?

Courts in Israel focus on whether the average consumer can understand that the advertisement is sponsored content. If an influencer receives payment and does not clearly state it, it is considered misleading under the Consumer Protection Law. The law requires full transparency in any sponsored advertisement. It's not a matter of courtesy but a legal obligation. Any advertisement involving payment or benefit must be properly marked. Regarding the influencers themselves, liability is personal. Not only the companies that fund are exposed to lawsuits, but the influencers themselves face legal risks.

When Is This Relevant — A Checklist

✓Did you receive payment for promoting a product?
✓Did you explicitly state it was sponsored content?
✓Does your content appear as a personal recommendation?
✓Are you afraid of negative reactions if you disclose the payment?

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The Specific Law That Applies

חוק רלוונטי

Consumer Protection Law

Defines the obligation to indicate sponsored content

Violation can lead to legal action and heavy fines

The Consumer Protection Law in Israel mandates transparency in any sponsored advertisement. This means any content where there is any form of benefit must be marked as such. Violation of this law can lead to class-action lawsuits and heavy fines for both the advertiser and the influencer.

Questions Everyone Asks — But No One Asks a Lawyer

What if I just recommend products I genuinely like?−

Even if you like the product, if you received payment or benefit for the recommendation, you must disclose it.

What counts as sponsored content?−

Any content where you received payment or any benefit to promote or recommend.

What to do if I've already posted content without disclosure?−

First, update the post and disclose the payment. If you encounter issues, seek legal advice immediately.

Can the fines be high?−

Yes, fines can reach very high amounts, especially if it's a class-action lawsuit.

How to protect myself going forward?−

Always clearly state any benefit received for promotion. Be transparent with your followers.

Real Situations — Which Side of the Line Are You On?

Ronit, a popular beauty blogger, receives payment from a cosmetics company but does not disclose it — at high risk. Avi, a tech influencer, states in his post that it's a sponsored ad — acting according to the law. Lily, a fitness coach, receives products to test but does not disclose it — at high risk.

What to Do Right Now

The first step is to review all the content you are publishing and ensure it is properly marked. Don't sign any advertising contracts without suitable legal advice. If you ignore the issue, you might find yourself in the midst of a costly and complex legal process. Seek legal advice to protect yourself.