Users are Facebook Advertising by Proxy

A complaint was lodged regarding user-generated posts on the official Facebook pages of VB and Smirnoff, which allegedly included sexist, racist, and discriminatory content, along with depictions of excessive and irresponsible drinking. The concern was that this content—appearing publicly on a brand's social media—could be viewed as advertising in breach of ethical standards. Smirnoff responded by stating that the content did not constitute advertising, as users who liked the page had already engaged with the brand and the platform merely facilitated community interaction. They argued that user comments do not reflect the brand's views. However, the Advertising Standards Board (ASB) disagreed. In a potentially industry-defining ruling, the ASB declared that brand-managed Facebook pages are considered marketing communications tools. That means all content, including user-generated posts, must comply with the Advertiser Code of Ethics. Interestingly, while the ASB upheld that the platform falls within the scope of advertising regulation, it dismissed the specific claims that the user posts in question breached the Code.

What This Means for Brands

This ruling shifts the goalposts for social media strategy in Australia. Brands can no longer treat their public Facebook pages as neutral forums. Instead, these pages are legally recognised advertising spaces, meaning businesses must take proactive responsibility for all visible content, including comments made by users. Key implications include:

1. Tighter Moderation Obligations

Brands are now accountable for moderating comments on their social platforms. This adds a significant operational burden, particularly for large companies with global pages. Failure to monitor user posts could mean breaching advertising codes, even if the content wasn’t brand-generated.

2. Erosion of Social Media Openness

Social media has historically thrived on openness and user interaction. This ruling may lead to increased censorship, as companies feel pressured to remove any potentially risky or controversial content. What was once a platform for authentic engagement may now become heavily sanitised.

3. Increased Legal Risk and Brand Exposure

For multinational brands, this raises complex questions of jurisdiction and compliance. For example, Coca-Cola’s global Facebook page dwarfs its Australian counterpart in audience size. Will companies need separate, moderated local pages? And can moderation at that scale be automated reliably?

The Bigger Question: Should Governments Regulate Social Media Content?

This case opens a broader debate—should governments and regulators control social media content, or should consumer sentiment be the ultimate judge? On one hand, regulatory oversight ensures ethical standards and protects vulnerable users. On the other, overregulation may stifle public discourse, pushing brands to over-censor and reduce transparency. Regardless of where you stand, one thing is clear: businesses must evolve. In today’s dynamic digital landscape, the lines between content, communication, and advertising are blurred. Corporate leaders must be aware of their obligations and act decisively to protect their reputation while respecting legal and ethical guidelines.

If you're unsure how this affects your digital strategy or how to implement compliant moderation processes, Dolman Bateman can help you assess your exposure and develop risk-smart social media protocols.

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Disclaimer:

The information provided in this article is general in nature and does not constitute personal financial, legal or tax advice. While every effort has been made to ensure the accuracy of this content at the time of publication, tax laws and regulations may change, and individual circumstances vary. Dolman Bateman accepts no responsibility or liability for any loss or damage incurred as a result of acting on or relying upon any of the information contained herein. You should seek professional advice tailored to your specific situation before making any financial or tax decision.