I am not an attorney and any comments I post are not intended, nor should they be construed, as legal advice. If you need legal advice, please consult a legal expert who is familiar with the area of legal expertise you need.
There are some terms that new or potential new writers/authors, game developers, and other retailers or manufacturers may not be familiar with. I will also include reasons why anybody who falls in one of the below categories and reviews your book should disclose if they are one of the below. There are several reasons why, and it is your responsibility as the author to make sure they disclose if you don’t want to risk problems.
I will add that any author should consider beta readers even if it’s not a work of fiction or literature.
Critique Group (see link above as it includes the differences between beta readers and critique groups) or: https://www.ignitedinkwriting.com/ignite-your-ink-blog-for-writers/why-every-writer-needs-a-genuine-critique-group/2018.
Advanced Reader Copy (ARC): https://www.ingramspark.com/blog/advance-review-copies; good tips from the same site: https://www.ingramspark.com/blog/advance-reader-copy-for-reviewers.
One of the key things my business management classes taught me was the dual concepts of “Why should I care?” and “Why does it matter?” These questions are often intertwined. In this case, the reason for caring and why it matters fall into two categories:
- Federal Trade Commission (FTC – U. S. federal government agency) and similar agencies in other countries
- Amazon, Barnes & Noble, Kobo, etc.
The FTC applies if you sell books, including ebooks, to United States (U. S.) customers. If your country has a similar agency, then you should be aware of it. For example, if I chose to sell a book/ebook on Amazon’s U. K. (United Kingdom) site, I need to learn what the laws and regulations are for the U. K. or risk dealing with the regulatory agency. The FTC guidelines require that beta readers, ARC recipients, and others who receive free copies of a book that aren’t available to the general public make it clear in any reviews they make the nature of the relationship. In addition, it’s the author‘s responsibility to make sure those individuals are following the guidelines. It’s one thing if you make a book free on Amazon or another book site that is available to the general public and one of the general public doesn’t make it clear.
The above also applies if you offer any product for free to a select group. For example, many Kickstarter campaigns may offer a test version of a product free to bloggers or vloggers in the hopes of getting them to review the product. You risk getting hit with fines if you don’t follow the guidelines.
Specific FTC links to be aware of: https://www.ftc.gov/sites/default/files/attachments/press-releases/ftc-staff-revises-online-advertising-disclosure-guidelines/130312dotcomdisclosures.pdf (PDF file) and/or https://www.ftc.gov/tips-advice/business-center/guidance/ftcs-endorsement-guides-what-people-are-asking.
For Amazon and other online retailers, the risks aren’t fines, but may be worse. A number of authors didn’t read the Amazon restrictions on things like KDP Select: https://kdp.amazon.com/en_US/select and found themselves no longer able to sell on Amazon. In addition to the restrictions for KDP Select, Amazon expects your beta readers, ARC recipients, etc. to make it clear in their reviews. It won’t matter if you weren’t aware that Amazon has such restrictions as they expect you should know the restrictions.
Personally, I have no plans to do KDP Select, Kindle Unlimited (KU), or any similar system that requires me to limit sales on other websites.