Last week, the Interest-Based Advertising Accountability Program (Accountability Program) released a compliance warning regarding the use of online-behavioral advertising (OBA) in conjunction with native advertisements. The compliance warning states that native advertisements tailored to a consumer based on the consumer’s browsing history (i.e., OBA) must comply with the Self-Regulatory Principles for Online Behavioral Advertising (“OBA Principles”), just like any traditional-based advertisement utilizing OBA would. Enforcement of the compliance warning will begin January 1, 2015.

The Accountability Program was developed by leading industry associations in order to regulate online behavioral advertising across the Internet. The Program issues compliance warnings to provide guidance on how to comply with the OBA Principles. The two key pillars of the OBA Principles are transparency and consumer control. The transparency principle requires companies to ensure that consumers are aware when their data is being collected for OBA purposes. The consumer control principle requires companies to provide consumers with an easy-to-use mechanism to opt out of having their data collected.

Companies, whether displaying native advertisements or traditional-based advertisements, must take the following steps if the advertisements are served in connection with OBA: First, provide “enhanced notice” to consumers that the advertisement is being tailored to the consumers, based on their browsing habits. The notice should be in the form of a link in or around the ad while the consumers are actually viewing the ad. The link should take the consumer to a landing page where the consumer can learn more about OBA and have the ability to opt out (it should be noted that companies often use the familiar Advertising Option Icon to fulfill the notice requirement). The information provided by the link landing page (including the opt-out mechanism) should also be on the company’s own website. And second, the company must provide consumers with a functional, easy-to-use way of opting out of the collection and use of their data. It should further be noted that website publishers who allow third parties to collect data for OBA purposes on their websites must provide notice of that data collection (whether the ad being served is a native ad or a traditional-based ad).

For more information on staying compliant and avoiding potential FTC action, read our previous blog post covering this issue.