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Contracts for Influencers: What you need to know before you sign!

Introduction

In the world of social media, influencers have become a driving force. With the growing importance of influencers, more and more influencer agencies and managements are emerging to work with influencers. But before you sign a contract with an agency or management as an influencer, there are some important points you should consider. This list is the result of my many years of experience in the industry. As someone who has represented both agencies and influencers for many years, and with my own 20 years of marketing experience, I have developed a deep understanding of what aspects are critical in contracts. It is important to be aware that a contract is not only legally binding, but also forms the basis for successful cooperation. Therefore, as an influencer, it is crucial that you are well informed and know what to look out for.

Understand the terms of the contract

It is essential that you understand the terms and conditions of the contract. Read the contract carefully and make sure you know all the clauses and conditions. If you don’t understand something, don’t hesitate to ask or seek legal advice. It is also important to check whether the contracts are concluded with the advertisers directly or through the agency. This can impact your relationship with advertisers and your bargaining power. Sometimes it is more advantageous to negotiate directly with advertisers, while in other cases the agency can negotiate better conditions. It is also interesting to know that a mixture of both approaches is possible. This means that in some cases you can negotiate directly with advertisers, while in other cases the agency acts as an intermediary. However, many agencies first try to negotiate exclusivity agreements, which means they have sole rights to broker partnerships and advertising deals. It’s important to be careful and ensure that such exclusivity agreements don’t limit your ability to secure favorable terms and partnerships that fit your brand and goals as an influencer. In addition, it is important to define the exclusivity precisely. Large influencers in particular are currently developing efforts to establish commercial activities in addition to pure streaming or influencing. Whether or not management should participate is a question of the exact wording of such a clause and, of course, the content of the activity.

Check the remuneration

As an influencer, it’s important to know how and when you’ll get paid. Check if the compensation is fair and if it corresponds to your market value. Also, pay attention to whether there are additional conditions that must be met in order to receive the compensation. It is also advisable to pay attention to whether there are provisions requiring repayment if poor performance is alleged or if the “sponsor” reduces compensation. Such clauses may entail financial risks and should be carefully examined. In addition, it is crucial that percentages agreed as remuneration or commission are precisely defined. It is also advisable to weigh these percentages in the context of other agency or management costs and deliverables. For example, if the agency provides additional services such as legal advice, this could justify the percentage it charges. It is also important to clarify whether the agency has a capable lawyer on hand in various cases, such as warning letters, and who will then cover the costs of that lawyer. This can be crucial in protecting you from legal problems and ensuring that you get the support you need in such situations.

Exclusivity clauses

Some contracts contain exclusivity clauses that could prevent you from working with other brands or agencies. Consider whether such clauses are acceptable to you and whether they might limit your options. It is also important to know the duration of these clauses and whether there are any exceptions. You should also check that you have access to all documents relating to your collaboration and insist that an audit clause is included. This gives you the right to examine the agency’s books and records to make sure you are being treated fairly. However, it is important to note that the professional appearance of an agency can be a great advantage in this context. Many brands prefer to work with influencers through agencies, as this is often more efficient and structured. Agencies can also act as intermediaries and ensure that communication runs smoothly. In addition, agencies often have expertise and resources that can be beneficial to influencers. Therefore, if managed properly, an exclusivity clause can also open up opportunities and facilitate access to brands that may not want to work directly with individual influencers.

Content control

Another important point is who has control over the content you create. Some contracts can be strict about what you can and cannot post. Make sure you still have enough creative freedom to remain authentic. It is also important to know if you have permission to review and approve content before it is published. This can help you protect your brand and online reputation. However, it is also important to recognize that working with proactive management that has experience and may be working with an experienced attorney can be beneficial. Such a team can help you identify and avoid potentially problematic content that is at risk of warning. The legal expertise that an experienced attorney brings to the collaboration can be critical to ensuring that published content complies with legal requirements and does not pose legal risks. In this case, some management oversight can not only be protective, but also help ensure that you act responsibly as an influencer and in accordance with the law. It’s a balance that must be struck to be both creative and legally secure.

Cancellation conditions

It is important to know under what conditions the contract can be terminated. Is there a minimum contract period? What notice periods apply? What happens if one of the parties breaches the contract? It is also critical that the method of termination be made clear. In addition, it should be clarified whether post-contractual commission obligations exist and how contracts that have not yet been concluded are to be dealt with. This may mean that you still have certain obligations after the contract ends, and it is important to know this in advance. In the current landscape, there are a variety of managements, and the professionalism they display, especially in handling credits and payments, can be an indicator of the likely success of a partnership. Often, first impressions of a contract can tell you a lot about how management operates. However, it is also important to note that the quality of a management can change over time. Management that used to be considered reliable can lose quality. In such cases, you may want to be able to switch uncomplicatedly. Therefore, it is advisable to have flexibility in terms of termination terms and ensure that you are not stuck in an unfavorable partnership when circumstances change.

Liability and rights

Check what liabilities and rights are specified in the contract. For example, who is liable if there are legal issues with the content you post? Who owns the rights to the content created? It’s important that you maintain control over your content and are protected in case any legal issues arise. Make sure the contract clarifies who is responsible for which aspects of the content and who is liable in the event of a dispute. In addition, it is advisable to check whether the contract includes provisions for agency or management support in the event of litigation. As indicated above, agencies or managements may have access to attorneys (like myself…) who can be helpful in these situations. It is also important to know if the agency or management is willing to help defend against legal claims and how the cost of legal assistance will be allocated. A clear contract should also specify how intellectual property will be handled and ensure that you, as an influencer, retain the rights to your own creative content. Finally, as an influencer, it is critical that you are able to protect your brand and your content, while receiving support and protection in the event of legal challenges.

Artists’ Social Security Fund

As an influencer, you may be classified as an independent artist. In this case you have to deal with the Künstlersozialkasse. It is important to clarify whether and how contributions must be made to the artists’ social insurance fund. These contributions can be a significant portion of your income, so it’s important to consider this in advance. Also, you should check if the agency or management is willing to cover some of these contributions. It is also advisable to be clear about what benefits you can expect in return from the Künstlersozialkasse, such as health insurance and pension insurance. This may influence your decision whether or not to be classified as an independent artist. It is also important to know which documents and proof are required to register with the Künstlersozialkasse and which deadlines apply. In some cases, it may also make sense to seek professional assistance to ensure that all requirements are met and that you can make the most of the benefits of the Künstlersozialkasse. Finally, as an influencer, it’s critical that you keep your social security in mind and make informed decisions that support your long-term financial stability.

Legal assertion of claims

It is important to determine whether the agency is obligated to legally assert claims and who will pay for the associated costs. In some cases, you may need to take legal action to enforce your claims. In such situations, it is important to know whether the agency will support you and whether you will have to pay for the costs or whether they will be borne by the agency. It is also advisable to look for specific clauses in the contract that clearly define the agency’s duties and responsibilities with respect to legal support. This may include whether the agency is required to provide legal assistance or help you find an appropriate attorney. In addition, it is important to clarify how quickly the agency must respond when legal problems arise and what type of support it will provide. It may also be useful to consider whether there is a cap on the costs the agency will pay in the event of litigation. Finally, as an influencer, it is critical that you are able to effectively defend yourself against legal challenges, and that you know what support you can expect from your agency and what financial obligations might be involved.

Conclusion

Signing with an influencer agency or management can be a great way to advance your career. However, it is important that you do not blindly rush into an agreement. Take the time to review the contract carefully, and don’t hesitate to seek professional help if you need it. Before you commit yourself long-term, you should consider agreeing to some kind of trial period first. The day-to-day business of an agency or management often shows whether they work professionally, can communicate easily and digitally, and are flexible. A good contract should be fair and protect your interests while leaving you free to succeed as an influencer. However, there are many other little things that should be taken into account. In my experience, many contracts in the industry are not much good. It does not always have to be malicious intent, sometimes it is ignorance or inexperience on the part of the agency or management. Nevertheless, the shortcomings in the contracts can often lead to disputes or have unexpected consequences in terms of social security, taxes or later on in possible legal disputes. It is therefore critical to be proactive and ensure that the contract you sign takes into account and protects both your short-term and long-term interests.

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Marian Härtel

Marian Härtel is a lawyer and entrepreneur specializing in copyright law, competition law and IT/IP law, with a focus on games, esports, media and blockchain.

Phone

03322 5078053

E‑mail

info@rahaertel.com

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