FTC's new rules that affect Internet marketers and affiliate marketers.

I've subscribed to Ewen Chia's mailing list and recently he sent a pdf about Internet marketing predictions for 2010. I thought yall might wanna read it. (attached).

I wanna bring your attention to pages 8, 9 and 10. He mentions there are new FTC rules that affect Internet marketers and affiliate marketers (especially testimonials on promo pages). I'll quote some.

Page 8 says
"if you get paid commission, or if you got a freebie in exchange for recommending a product, then you'd better openly disclose that connection to your readers or you could face an FTC fine."

page 9 and 10
"Another issue centers on affiliate products. If you're promoting someone else's product, you could be held liable for the product owner's non-compliance with the new FTC rules regarding testimonials. And furthermore, if you have affiliates selling your products, and they aren't in compliance in their own sales pages and websites, you could be held liable, right along with them."

I'm not sure I understand the whole thing. As page 8 says, does it mean that I have to let my list know that my affiliate link is embedded? Do I have to tell the world that I got a commission because so-and-so bought the merchant's product?

Regarding the other issue (as an affiliate), does it mean I have to check with the product owner that his testimonials and sales page comply with the rules? And when I in turn have my own affiliates, does it mean I have to let them know about this issue?

As an affiliate, I don't use testimonials. But the products I promote usually have testimonials, so that is a cause for concern.

Any thoughts?