An online photo book retailer has been fined nearly $40,000 for asking social media influencers to not disclose they had been paid to post a review on Instagram.

It marks the first time a penalty has been handed down to an Australian business for an influencer not disclosing paid content.

The Australian Competition and Consumer Commission (ACCC) issued two infringement notices totalling $39,600 to Tomsem Consolidated, which trades as PhotobookShop, after an influencer reported concerns.

PhotobookShop sells photo books, photo canvases, photo puzzles and other products online.

The ACCC found that between August 2024 and September 2025, the company commissioned influencers to make reviews of its products online, and on 107 occasions, instructed those influencers not to disclose it compensated them with free PhotobookShop products worth between $50 and $400 for the review.

“Please ensure that your videos do not mention that the product is free, sponsored, or that PhotobookShop contacted you to create them in exchange for products,” a screenshot of one such written agreement released by the ACCC read.

The ACCC said one influencer created a review that did not disclose the commission or the free product. The ACCC issued an infringement notice, alleging PhotobookShop had presented to consumers that the review was an unpaid review.

“Businesses must not mislead consumers by posting misleading reviews or failing to disclose when an influencer has been paid to create social media content, whether that payment is free gifted products or services, or money,” ACCC deputy chair Catriona Lowe said in a statement.

“Influencers can be a powerful marketing tool, and the Australian consumer law applies as much to the digital world as it does to bricks and mortar retailers.”

Businesses advertising online, including through the use of influencers, need to disclose paid advertising under Australian consumer law, just as they would in other mediums like TV or radio.

For the second infringement, the regulator also found PhotobookShop had substantively edited a review from an influencer to remove negative content.

In a review of a hardcover photo book, an influencer said: “I used their AI assistant tool to help me make it [the hardcover photo book] and while it was a bit fiddly, it did help the overall experience and then I got the chance to modify anything I was unhappy with. It was a bit confusing but I am happy with my photo book.”

The ACCC alleged this was edited down to: “I used their AI assistant tool to help me make it [the hardcover photo book] and I am happy with my photo book.”

There was no acknowledgment on the post that the video had been edited, the ACCC said.

“PhotobookShop’s misleading reviews may have caused consumers to buy PhotobookShop’s products when they would not have bought them based on the complete video review,” Lowe said.

PhotobookShop was approached for comment. Posts from influencers on the company’s Instagram page now clearly state sponsored content and posts where gifts have been provided to those making the reviews.

Influencers have been a focus of the ACCC’s work for the past several years. A sweep was conducted in 2023 of platforms including Instagram, TikTok, Snapchat, YouTube, Facebook and Twitch, with a focus on fashion, beauty, travel, health and fitness.

The ACCC found 37% of those online reviews or testimonials that were assessed had raised concerns.

The regulator stated on Tuesday it would soon release guidelines for influencers outlining their obligations under Australian consumer law.