Starting a new business requires careful planning.  It also requires publicity.  Publicity is what connects you to your consumers, regardless of your chosen field.  Whether you offer good or services, you need consumers.  Fortunately, in the digital age, reaching them is easier than ever.  With some careful planning, and perhaps some marketing assistance, you can reach thousands of potential consumers with the click of a button.  That’s a pretty hard opportunity to ignore.  However, there are some potential challenges that can arise when you take your business online.  Social media marketing can start robust and dynamic online discussions.  Often, they’re largely outside of your control.  There is always the risk that online engagement may head in the wrong direction, and take your business’s good name with it.  That can have consequences in terms of publicity.  But even more importantly, it can have legal consequences.  So let’s take a look at the obligations placed upon you when you take your business online.

Risk and reward: social media has lots to offer, but there are legal risks too


We should start by clarifying that online marketing is invaluable.  In fact, in today’s commercial environment, maintaining a social media presence is almost essential.  An overwhelming majority of businesses maintain significant online engagement with their clients and customers over social media.  That includes your competitors!  For that reason, presenting your business to the public is just about a commercial necessity.  And where better to do so than social media?  But before you open for business on Facebook or Instagram, consider the risks.


Your business’s social media page is effectively a publication.  As far as the law is concerned, you—as the business owner—are the publisher.  As a result, you assume some responsibility for what is written on your page—even if you didn’t write it yourself.  Then there’s privacy; social media pages aren’t exactly secure.  For that reason, any private information that is transmitted over your social media pages may risk compromise.  With all of that in mind, let’s move on to the solutions: here’s how to manage some of your newly assumed online responsibilities.


Navigating your online obligations under Australian Consumer Law


As a business owner, you are probably familiar with Australian Consumer Law.  If you’re not, here’s a quick summary: consumer law governs the relationships between businesses, and consumers.  One of its many focuses is advertising.  Under consumer law, businesses must ensure that the content they publish is accurate.  It doesn’t matter if you publish a statement on a brochure, a social media page, or even a sandwich board; that statement still needs to be accurate.  Australian Consumer Law uses the phrase ‘false or misleading statements’ to cover issues relating to false advertising.  That phrase is deliberately quite broad.  The term ‘misleading’ is taken to include a wide range of representations, including silence.  Under consumer law, businesses that fail to correct their consumers’ falsely held impressions of a product, can be liable for a breach.


Luckily, consumer law is a pretty well-established field among business owners.  And with some input from an experienced commercial lawyer, breaches are easy to avoid.  However, social media can add an extra layer to your obligations.  If someone posts a false or misleading comment to your page, you can be liable for breach in some cases.  As the administrator of the page, you are effectively the editor and publisher.  You need to make sure you set clear boundaries, and react promptly to address any potential breaches as they arise.


Defamation: Australian has expansive defamation laws, and online breaches are common


Defamation is a field of law designed to protect people and businesses from reputational harm.  To that end, defamation law offers certain safeguards that you and your business can enjoy.  However, if you contravene the laws against defamation, there may be expensive consequences.  Before we go any further, let’s take a quick look at defamation law in Australia.  Defamation law allows individuals to seek compensation for false and damaging statements that have caused reputational harm.  There are a range of remedies available for defamation, but the most common are monetary damages, and injunctions.  Damages offer a sum of money, as recompense for the damage caused.  Injunctions prevent ongoing damage, by ordering that damaging publications be removed.


Social media has prompted significant and recent developments in defamation law.  The most significant, though, was seen in New South Wales.  There, a Supreme Court decision found that prominent media outlets were responsible for defamatory comments made on their social media pages.  Those comments related to stories that the media outlets had posted online, and they were made by readers who had no connection to the media.  The Court stated that: [a] defendant cannot escape the likely consequences of its action by turning a blind eye to it.  So, what does that mean for you?  Essentially, it means that you are responsible for all content on your social media page—including comments!  If one comment crosses the line, you may find your business liable for defamation.


Privacy: consider your obligations when it comes to the information you convey or receive online


Privacy obligations are many and varied, when it comes to business.  However, a significant proportion of privacy obligations arise in the course of information collection, and transmission.  That means a lot of social media engagement falls within the scope of privacy laws.  Those laws impose restrictions on what you can do with the information you collect, and how you can store it.  The main reason for that is data security.  Social media accounts don’t always offer the highest standard of data security.  There are things you can do to strengthen yours—like regularly changing your passwords.  But it’s important to be aware that social media isn’t an appropriate forum to transmit sensitive information.  If you intend to collect personal information over social media, you should seek professional legal advice.  It may the case that social media simply isn’t the right forum over which to collect the information you are seeking.


Intellectual property: here’s how to ensure your online engagement is compliant


Intellectual property law has an interesting intersection with social media content.  The area of law, at least as it relates to social media, is still developing.  However, some trends are emerging, which suggest that social media posts can infringe the intellectual property rights of others.  In a broad sense, posting or sharing online posts may amount to a reproduction of copyright work.  But in the case of posts on Facebook, for example, the terms of service can also intervene.  The Facebook terms of service create a form of ‘IP licence,’ which permits posts to be reproduced in many ways without the need for compensation.


That is not a complete protection, though.  There remains plenty of space for intellectual property rights to be breached online.  One example exists in page names; businesses must comply with trademark regulations on social media, just as they do anywhere else.  Again, it’s useful to have expert advice when you’re navigating intellectual property and social media.  Contact an experienced commercial lawyer if you need assistance.


Contact a legal professional to help you maintain online compliance


Social media platforms are evolving at a very rapid rate.  The law is working hard to keep up, as well.  That means your legal obligations are very dynamic, in relation to social media and your online presence.  As a business owner, you should aim to remain abreast of your obligations and those of your business on social media, and online more broadly.  But it’s also important to recognise that those obligations are governed by technical and evolving laws.  If you encounter any difficulties in understanding your position, it’s vital to seek professional help.  Don’t risk falling foul of the law; contact an experienced commercial lawyer.


The information provided by Kafrouni Lawyers is intended to provide general information and is not legal advice or a substitute for it. Business people should always consult their own legal advisors to discuss their particular circumstances. Kafrouni Lawyers makes no warranties or representations regarding the information and exclude any liability which may arise as a result of the use of this information. This information is the copyright of Kafrouni Lawyers.

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