The Financial Conduct Authority (FCA) has produced guidance on posting financial promotions on social media.
Type of communication
Any form of communication (including social media) can be capable of being a financial promotion, depending on whether it includes an invitation or inducement to engage in financial activity. The FCA states that this could include, for example, "advergames",
where promotional messages are placed in entertainment applications.
A financial promotion must be made in the course of business in order to fall within the regulatory perimeter.
Provision of information
All financial promotions must be fair, clear and not misleading, even if the information ends up in front of a non-intended recipient through (for example) others retweeting on Twitter or sharing on Facebook. The requirement to be fair and not misleading allows
consumers to appreciate the potential benefits and relevant risks.
Each tweet, Facebook update, or web page is a separate communication and needs to be considered individually and comply with the FCA’s rules.
There are requirements to include risk warnings or statements in promotions for certain products or services. This could be problematic when using character-limited social media and therefore images may be inserted to cover this requirement. However, the image
itself must be compliant.
For investments, image advertising is exempt from most of the detailed financial promotions rules and guidance, but it will still need to be fair, clear and not misleading.
Retweeting and forwarding
When a firm’s communication is shared or forwarded (such as retweeted), responsibility for compliance with the FCA’s rules lies with the person who retweets or forwards the communication. However, any breaches of the FCA’s rules in the original communication
are still the responsibility of the originating firm and not the ‘retweeter’.
The FCA has decided that hashtags are not an appropriate way to identify promotional content.
The FCA considers that paid-for advertising on several social media platforms already signposts that the content is promotional and it is not necessary to identify the communication as promotional.
Should you have any queries regarding the subject matter of this article, or need any assistance in connection with regulation generally, please contact
Keith Kennedy, Partner in the Corporate and Commercial Department at
email@example.com or telephoning 0161 833 9211.
The information and opinions contained in this article are not intended to be comprehensive, nor to provide legal advice. No responsibility for its accuracy or correctness is assumed by Berg or any of its partners or employees. Professional legal advice should
be obtained before taking, or refraining from taking, any action as a result of this article.