LONDON - A group of British celebrities, including Ellie Goulding and Rita Ora, have agreed to spell out in social media posts clearly if they are being paid to promote a brand, Britain's Competition and Markets Authority (CMA) said on Wednesday (Jan 23).

The agency said it has secured formal commitments from 16 celebrities, who also include models Alexa Chung and Rosie Huntington-Whiteley, to change how they label social media posts to their millions of followers, Reuters reported.

The CMA said last August that it had begun investigating the trend of celebrities and social media "influencers", such as bloggers and vloggers, endorsing brands on platforms such as Instagram and Facebook.

Brands pay thousands of dollars for a single social media post. But European Union consumer protection law requires social media users to disclose whether they have received gifts or cash to endorse a brand, to avoid giving the impression the post represents their personal view, the CMA said.

"People could, quite rightly, feel misled if what they thought was a recommendation from someone they admired turns out to be a marketing ploy," CMA chief executive Andrea Coscelli said in a statement.

Under the rules, content posted by the celebrities in exchange for payment, gifts or loans must be clearly labelled using hashtags such as #ad or #sponsored and must prominently appear at the beginning rather than at the end of a string of hashtags, BBC reported.

Instagram already has a paid-partnership tool that makes it clear when posts are sponsored.

According to the BBC, a failure to comply with the agreement reached with the CMA could see the celebrities being taken to court and facing heavy fines or prison sentences of up to two years.

Singers Goulding and Ora have 24.4 million followers among them.

Warning letters have also been sent to a number of other celebrities - whom the CMA did not name - urging them to review their practices where some concerns have been identified, the watchdog added.

"Further investigation work will look at the role and responsibilities of social media platforms," the CMA said.