Legal Risks of Verbal Collaborations in Influencer Marketing

Are verbal collaborations in influencer marketing legally safe in India? Explore the legal risks and why written contracts are essential for brands and creators.

India’s influencer marketing industry is expected to cross ₹3,000 crore by 2025. While brands are increasing their digital ad budgets, a worrying number of these partnerships are built on informal understandings – WhatsApp chats, DMs, Zoom calls, and voice notes.

This casual approach reflects both the startup mindset of agility and the freelancer culture of trust-based deals. But with legal scrutiny on the rise and regulatory tightening by CCPA and ASCI, the question is:

Can verbal collaborations still be considered a “valid” strategy—or are they a legal liability waiting to explode?

Verbal Collaborations in Influencer Marketing

In India’s booming digital economy, influencer marketing is no longer just a trend – it’s a core part of many brands’ outreach strategies. From YouTubers reviewing gadgets to Instagram influencers showcasing beauty products, collaborations are happening every day. But here’s the catch: many of these partnerships are verbal – agreed upon through a DM, a call, or even a voice note.

Is that enough? Legally, ethically, and strategically—the answer is no.

What Is a Verbal Collaboration?

A verbal collaboration refers to a mutual agreement between a brand and an influencer that’s not documented in writing. The terms – be it deliverables, compensation, timeline, or usage rights – are understood informally.

Such collaborations might seem quick and convenient, but they come with serious downsides.

Verbal Agreements: Legal in Theory, Risky in Practice

Under Section 10 of the Indian Contract Act, 1872, even a verbal agreement can be legally enforceable if it fulfills the conditions of a valid contract:

• Offer and acceptance

• Lawful consideration

• Intention to create legal relations

• Capacity of parties

• Lawful object

However, the lack of documentary evidence makes such agreements difficult to prove in case of disputes. Let’s say a brand promises ₹50,000 for a video post and later backs out. Without a written agreement, the influencer may struggle to prove the claim in court. The burden of proof is high and often unattainable, especially in digital-only communications.

Why this matters:

• In court, written documents override oral assertions.

• DMs or voice notes are not considered primary evidence unless validated under Sections 65A & 65B (electronic evidence rules).

• Most influencers and brands don’t preserve or certify these digital records correctly.

Strategic Misalignment in Verbal Collaborations

Beyond legality, the real battlefield is strategic. Verbal collaborations are minefields for brand dilution, IP misuse, and reputational loss.

Key Risk Vectors:

a. Ambiguous Deliverables

• “Please post a reel” – but no clarity on duration, posting time, exclusivity, or approval.

• Disputes over content edits, caption approvals, or hashtags.

b. Undefined Compensation

• Barter vs paid? Fixed fee or CPM-based? Is GST included? Payment timeline?

• Frequent cases of non-payment or partial payment, especially among micro-influencers.

c. No Control Over Brand Messaging

• Influencer may use unsanctioned messaging or violate ASCI disclosure norms, risking penalties for both.

• Brands cannot compel removal or corrections without contractual control.

d. IP and Usage Rights

• Who owns the content? Can the brand use the video in a paid ad? For how long?

• Without a clause, influencers may demand fresh licensing fees, leading to copyright disputes.

e. No Proof of Agreement and Payment Dispute

• Screenshots of chats may not always hold up in legal proceedings. The informality makes enforcement difficult.

• Without a written commitment, influencers are at risk of delayed payments or worse – non-payment.

f. Lack of Accountability

• If a campaign backfires or the influencer misrepresents facts, neither party has a fallback framework.

ASCI and CCPA Regulatory Clarity: No Place for Informality

ASCI has been cracking down on non-disclosure of sponsored content, and the CCPA Guidelines for Social Media Influencers require:

• Clear disclosures for paid, barter, or affiliate partnerships.

• Audit trails of collaborations.

In absence of formal documentation, compliance becomes a grey zone, and:

• Influencers face penalties up to ₹10 – 50 lakh.

• Brands can be punished under the Consumer Protection Act 2029 for misleading advertisment.

Real-World Disputes: What the Courts and Tribunals Are Seeing

❖ Case: Unpaid Influencer Services (Delhi, 2022)

A Delhi-based fashion brand verbally promised ₹1.2 lakh to a beauty influencer. After posting, the brand ghosted her. She filed a complaint but couldn’t prove the terms beyond a WhatsApp voice note. The case was dismissed due to insufficient admissible evidence.

❖ Case: Unauthorized Commercial Use (Mumbai, 2023)

An influencer’s original content was repurposed in a paid TV ad by the brand without consent. No contract existed to limit usage. She sued under copyright infringement and was partially awarded damages – but it took 18 months of litigation.

These cases highlight that lack of written contracts creates prolonged litigation, unclear liability, and unaccounted risk.

The Future Is Not Verbal: Contractual Culture Is the Only Way Forward

Influencer agreements must evolve to include:

Clause	Why it Matters
Deliverables & timeline	Avoid ambiguity and ensure accountability
Fee structure & GST	Legal clarity and tax compliance
IP ownership & licensing	Prevent content theft and misuse
Morality clause	Protect brand from influencer misconduct
Disclosure obligations	Align with ASCI and CPA requirements
Termination & penalties	Safeguard against breach or reputational risk