Office of Fair Trading has taken unprecedented action against Handpicked Media for engaging in commercial social media activity “without sufficient disclosures in place to make it clearly identifiable to consumers that the promotions had been paid for”. OFT took the initiative of investigating Handpicked Media by opening the case on 7th July 2010.

Following the investigation Handpicked Media was asked to sign undertakings to comply with Enterprise Act 2002. The signed undertakings prohibits Handpicked Media from propagating content which does not clearly identify its promotional commercial nature.

OFT said:

‘The internet plays a key role in how people purchase products and services and the importance of online advertising continues to grow. The OFT has bolstered its expertise in this area and is taking targeted action to ensure that the law is clear, increase business compliance and empower consumers.

‘The integrity of information published online is crucial so that people can make informed decisions on how to spend their money. We expect online advertising and marketing campaigns to be transparent so consumers can clearly tell when blogs, posts and microblogs have been published in return for payment or payment in kind. We expect this to include promotions for products and services as well as editorial content.’

This judgement could have a huge impact on some SEO strategies utilized by search engine marketing agencies in the UK. Paid editorial links with targeted anchor text is against Google’s guidelines, Google penalizes sites who sell editorial links.

Going against Google’s guidelines might not be taken seriously by some SEOs but going against state law has to be taken seriously, unless you are an offshore SEO.  Acquiring links through ethical link building strategies is not very easy as it is, OFT’s judgement will pose another huge obstacle for link builders and seo agencies.

OFT’s strategy for protecting consumers shopping online
Investigation into inadequate disclosures in respect of commercial blogging activity