Advertising in the United States: what changes

Three layers, and the strictest one governs

Federal law sets the baseline: advertising must not be deceptive or unfair, and the Federal Trade Commission enforces that standard across most industries. State law adds its own requirements, particularly on privacy and on how data may be collected and shared. Platform policy sits on top with its own rules and its own enforcement, which is often faster and less forgiving than either.

The three do not contradict each other so much as stack. A campaign that satisfies the federal standard can still breach state privacy requirements, and one that satisfies both can still be rejected by a platform. Compliance means identifying the strictest applicable layer for each element and designing to that.

Substantiation is the actual risk

The US does not pre-approve advertising. It permits a claim and then asks, if challenged, whether there was a reasonable basis for making it at the time it ran. That shifts the entire risk onto documentation, which is why the same claim can be routine for one advertiser and expensive for another with nothing on file.

Health and safety claims carry the highest bar. Claims about treating, preventing or curing a condition generally require competent and reliable scientific evidence, and testimonials are not evidence. Earnings and financial claims need support for the results implied, not merely for the experience of the person in the ad. Environmental claims are held to a similar standard of specificity.

The test before a claim goes live: if a regulator asked for the file behind this sentence, could it be produced tomorrow? If not, the claim is the problem, not the wording of the ad.

Endorsements, testimonials and disclosures

Paid endorsements must disclose the connection between endorser and advertiser. The requirement is not a specific phrase; it is that a reasonable viewer would understand the relationship. An undisclosed paid review, or an incentivised post that reads as personal opinion, is treated as deceptive.

Testimonials must reflect typical results or be qualified so they do not imply them. That is where most review-driven creative breaks: the individual results are real, but presenting them without context implies they are usual.

The disclosure also has to sit where it will be seen. A link below the fold, a hashtag buried among thirty others, or a disclaimer at the end of an ad nobody finishes does not meet the standard.

State privacy law and what it does to tracking

There is no comprehensive federal privacy statute. What exists instead is California’s framework plus a growing set of state laws modelled on it, with thresholds that vary and obligations that overlap without being identical. For advertisers the practical effects are consistent: disclose what is collected and why, honour opt-out requests, and respect opt-out signals sent by the browser.

This changes the measurement layer rather than the creative. Where a visitor has opted out, the pixel should not be collecting the data it would otherwise collect, and consent state needs to be communicated to the platform so modelling can compensate for the gap. Advertisers who fix only the banner and leave the tags untouched have the appearance of compliance and none of the substance.

Sensitive categories are treated more strictly than the general rule, and data from users known to be children falls under separate federal law with its own enforcement. Where a campaign touches either, data collection deserves a design decision rather than a default setting.

Tax treatment of advertising services

Advertising is a service, and in the US services are taxed state by state. A minority of states tax advertising or certain digital services, and the analysis usually turns on who the buyer is, what is being purchased and whether it is bundled with something else.

For a non-US advertiser buying media the position differs again: the question becomes whether the advertiser has a taxable presence in the state and what obligations follow from it. This is not a question to settle from a search result, and the position moves as states legislate.

The practical step is to establish, before the first invoice, which entity is buying and where it is registered. An uncertain tax position discovered after a year of spend costs considerably more than the same question answered in advance.

Sector rules that override the general ones

Several verticals are governed by rules that sit above the general standard. Financial promotions fall under securities and lending regulation. Gambling advertising depends on state licensing and is prohibited in some states outright. Alcohol restrictions vary by state and sometimes by locality. Cannabis remains federally illegal while being legal in some states, which puts platform policy and federal law in direct tension.

Political advertising brings its own disclosure requirements and, on the platforms, a separate authorisation and verification process. Health products carry the heaviest documentation burden of any category, and children’s products attract both privacy and marketing restrictions.

The pattern is consistent: a vertical-specific rule replaces the general standard rather than adding to it, so checking the general rule first can give a false sense of clearance.

What to settle before the first dollar

Decide which entity is the advertiser of record, and make sure the destination site, the payment method and the registration documents agree on it. Build the claim file before the creative rather than after a challenge. Decide what the tracking stack does when a visitor opts out, and test it instead of assuming it. Establish the tax position. And write down who monitors policy changes, because on all three layers they change without notice.

One commercial variable is worth removing early. All engagements we handle settle in USD or USDT as a matter of company policy, which keeps invoicing consistent across markets rather than turning each new market into a new payment problem.

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