On August 6, 2026, Japan's Consumer Affairs Agency (CAA) issued corrective orders against South Korea-based Snow Corporation and its Tokyo subsidiary SNOW Japan. The CAA found that SNOW Japan paid third parties to post on X about the SNOW photo-editing app, following guidelines SNOW Japan set, without making clear the posts were commissioned. MLex reported the order on August 7. The case is a useful test of whether Japan's year-old approach to undisclosed advertising is proportionate.
What the CAA found
The CAA's August 6 news release is specific about the legal reasoning. Snow Corporation had delegated decisions about Japan-facing content to SNOW Japan. SNOW Japan then asked third parties, in exchange for compensation, to post on X in line with the direction it specified. Because both companies were involved in determining what those posts said, the CAA treated the posts as the companies' own representations.
The CAA then asked whether an ordinary consumer could tell these were the business's representations. SNOW Japan had not disclosed that the posts were requested by it, and nothing in the posts made that clear, so the CAA found them hard for consumers to identify as advertising. That brought them within the stealth-marketing notification under Article 5, item 3 of the Act against Unjustifiable Premiums and Misleading Representations. The orders were issued under Article 7, paragraph 1.
The orders have four parts. The companies must promptly stop the practice. They must inform consumers that the representations violated the Act. They must adopt recurrence-prevention measures and communicate them to officers and employees. And they must not repeat the conduct. The release lists no monetary penalty.
The case for the rule
The strongest argument for this regime is simple. A post that looks like an unprompted opinion carries credibility that an advertisement does not. When a company pays for such posts and hides the payment, consumers are misled about the source of the endorsement, and honest competitors who label their ads are disadvantaged. A rule that only banned false claims would miss this harm, because the problem here is who is speaking, not whether the content is true.
The CAA's stealth-marketing guidance states that the rule applies from October 1, 2023, and covers representations that consumers cannot recognise as the business's own. Commissioning a third party counts.
Why the design is proportionate
The regime avoids the most common failure of influencer regulation, which is pushing liability onto individuals. The CAA states that the regulated party is the business that supplies the product or service, the advertiser, and that influencers and other third parties who accept requests are not themselves regulated. DLA Piper's 2023 summary of the new law says the same.
This matters for speech and for innovation. Ordinary users and small creators are not asked to learn a compliance code, and an enthusiastic review does not become a legal risk for the person who wrote it. The party with the budget, the lawyers and the control over the campaign carries the obligation. In the SNOW case, the CAA's reasoning was about the companies' control of the content, not about the posters.
The remedy is also modest. Disclosure is the cure. A company that labels a paid post as an ad can run the same campaign legally, so the rule does not ban influencer marketing and does not require a view on whether a product is good. For a pro-innovation reader, that is the right shape: it corrects an information problem without restricting the underlying activity.
Enforcement so far
Enforcement has been cautious. According to Baker McKenzie's Tokyo office, the CAA's first stealth-marketing order, on June 7, 2024, went to a Tokyo medical corporation that offered customers discounts for favourable reviews on its own website. That was almost eight months after the rule took effect. The SNOW order applies the same logic to a large foreign-owned consumer app, and to a platform, X, where paid posts are easy to scale.
Where the risks are
Proportionality is not guaranteed, and three questions remain.
- Where control ends. The CAA relied on the fact that SNOW Japan set the direction of the posts and that Snow Corporation delegated Japan-facing content decisions. The line between a business that merely sends a free product and one that directs content is the hard part of the rule in practice. Clear published examples help companies avoid over-compliance, such as labelling every mention of a brand.
- Foreign parents. The order reaches Snow Corporation because it delegated Japan-facing content decisions. Global companies should expect that a parent can be held responsible for local marketing it empowers a subsidiary to run, and should write that into their compliance structure.
- Platform tools. Nothing in this order requires platforms to do anything. That is the right call. Labelling features on platforms can help, but making platforms police commercial relationships they cannot see would invite over-removal of legitimate speech.
Takeaways for companies
The practical lesson is that disclosure must come from the advertiser's side of the relationship. If a company pays for a post, or directs what it says, the post should say it is an ad in a way a typical reader can see. Contracts with posters should require that, and the company should check that it happens. The SNOW order shows the CAA will look at who directed the content, not only at who pressed the button.
For policymakers elsewhere, Japan's approach is a reasonable template: a narrow rule, aimed at the party with control, with a remedy that corrects the information gap and leaves the speech itself alone. The test will be whether future orders keep that discipline, and whether the CAA continues to publish its reasoning in enough detail for companies to follow it.