The FTC Fake Reviews Rule, What a Small Shop Can and Cannot Do
Reviews sell products, which is exactly why a new shop feels pressure to get some on the page fast. Asking a friend to post five stars, offering a coupon for a good rating, or quietly hiding the one harsh review can all seem like harmless shortcuts. Under a federal rule that took effect in 2024, several of those shortcuts are now violations with real penalties. The good news: the honest ways to collect reviews are clearly allowed.
1. The rule in one paragraph
The Federal Trade Commission's Rule on the Use of Consumer Reviews and Testimonials, at 16 CFR Part 465, went into effect on October 21, 2024. The FTC says it addresses deceptive and unfair conduct involving reviews and testimonials, and that it authorizes courts to impose civil penalties for knowing violations. The rule's definition of a business includes an individual who sells products or services, so a one-person shop is covered.
2. What is prohibited
2.1. Fake reviews
A business may not write, create, or sell a review or testimonial that misrepresents that the reviewer exists, that the reviewer actually used the product, or what their experience was. A business also may not buy such reviews, or spread such testimonials, if it knew or should have known they were fake.
That covers reviews written under a made-up name and reviews from someone who never used the product.
2.2. Paying for a particular sentiment
The rule bans giving compensation or other incentives in exchange for, or conditioned on, reviews expressing a particular sentiment, whether positive or negative. The rule's definition of buying a review includes money, gift certificates, products, services, discounts, coupons, contest entries, or another review.
So "Leave a 5-star review and get 10% off" is out. "Leave a review and get 10% off" is a different situation, discussed below.
2.3. Undisclosed insider reviews
Owners and managers may not post reviews of their own business or products without clearly disclosing their relationship. The rule also restricts an officer or manager from soliciting reviews from employees or immediate relatives (a spouse, parent, child, or sibling) when the resulting reviews lack a disclosure and the manager encouraged hiding it, did not tell reviewers to disclose, or ignored undisclosed reviews once known.
For a one-person shop, the practical version is simple: do not have your family post reviews of your products as if they were ordinary customers.
2.4. Suppressing reviews
Two kinds of review suppression are banned:
- Using unfounded legal threats, physical threats, intimidation, or knowingly false public accusations to stop a review from being written or to get one removed.
- Presenting the reviews on your site as most or all of the reviews submitted when you are hiding some based on their rating or negative sentiment.
The rule lists neutral reasons you can still withhold a review, as long as you apply them equally regardless of sentiment: trade secrets, defamatory, harassing, abusive, obscene, or sexually explicit content, someone else's personal information, discriminatory content, clearly false or misleading content, reviews you reasonably believe are fake, and reviews wholly unrelated to your products.
2.5. Fake "independent" review sites and fake followers
A business may not misrepresent that a website it controls offers independent reviews of products in its category. The rule also bans buying or selling fake indicators of social media influence, such as followers or likes generated by bots or fake accounts, when used to misrepresent influence.
3. What you can still do
3.1. Ask every buyer for a review
The rule carves out generalized solicitations to purchasers. The FTC's Q&A gives an example close to what most small shops do: a business that routinely emails every purchaser asking for a review is not responsible if an employee who happened to buy something writes a false review in response.
3.2. Offer the same incentive for any review
The FTC's Q&A also addresses offering an incentive to all customers who post a review after receiving such an email. The answer: that does not violate the insider-review section, regardless of the incentive, because it is a generalized solicitation. What the rule targets in Section 465.4 is conditioning the reward on a particular sentiment.
The FTC adds that incentivized reviews are also treated as consumer testimonials under the rule.
3.3. Moderate for real reasons
You can remove reviews that fall into the neutral categories above, applied the same way to good and bad reviews alike.
3.4. Respond to criticism
Nothing in the rule stops you from replying publicly and politely to a negative review, fixing the customer's problem, or explaining your policy. What you cannot do is threaten or intimidate the reviewer into silence.
4. A gray area to avoid
The FTC was asked whether a business can ask for reviews only from customers it thinks are happy. Its answer: the rule does not specifically prohibit that, but the practice could violate the FTC Act more broadly, pointing to the Endorsement Guides. A shop that wants clean records should ask all buyers, not a hand-picked few.
5. A review policy for a small shop
- Send the same review request to every buyer, by email or packing slip.
- If you offer a thank-you, offer it for any honest review, never for a high rating.
- Never write, buy, or trade reviews, and do not ask family to post as customers.
- Write down your moderation rules and apply them to every review regardless of star rating.
- Answer negative reviews publicly and calmly; never threaten.
- Disclose any relationship when you or someone close to you discusses your products.
6. Key takeaways
- The FTC's reviews rule took effect October 21, 2024, and courts can impose civil penalties for knowing violations.
- Fake reviews, buying reviews of a particular sentiment, and undisclosed insider reviews are prohibited.
- Hiding negative reviews while presenting the rest as complete is banned; neutral moderation rules are allowed.
- Asking all purchasers for reviews is a generalized solicitation the rule permits.
- Reward the act of reviewing, never the rating.