Using the public space without proper permission is not a legal activity. Though a few countries have made natural-media legal for commercial purposes, in most countries it is at best tolerated. At worst, simply illegal. Generally, you could say it is not not legal in much the same way Google Street View was in its early days.
There are ways to produce natural-media campaigns legally and with the required permissions. Keep in mind that getting the proper permits can take several weeks.
The tone of your campaign and its visual appeal will influence if you will be granted permission. NME recommends producing work that makes the surrounding look better and leaves the area in better condition than it was when you arrived, somehow adding value to the local community.
If your goal is high exposure and you will use the content generated by the campaign on the internet, you do not need to brand the physical work. Branding can be added digitally to the content that you will publish making it easier to get permission. The biggest issues most municipalities have with natural-media campaigns is that brands are commercialising the public space.
Hard sell or visually boring or even ugly campaigns will make it harder to get permissions in most cases. Soft sell campaigns are viewed much more favourably. For instance, a campaign that is more in line with street art will be viewed more positively than a traditional hard sell outdoor advertisement. However, in some circumstances money will open doors as will the promise to make sure your campaign looks good and will be completely removed after a period of time.
Keen Footwear and Clorox - Green Works are two examples of highly successful campaigns that used a street art approach.
Keen Footwear created a sidewalk mural in front of one of their biggest retail partners. Though it does contain a logo it doesn't include a sales pitch. After four weeks the mural was removed. The city of Hamburg got a nice clean sidewalk, Keen Footwear got a huge amount of publicity as did the retail outlet. A win, win, win situation. We did not arrange permits but we were very respectful of the cities concerns, created a mural that promoted sustainability and we invested in the cleanup. We also worked with a water foundation to provide clean drinking water in a region where clean drinking water was scarce to compensate for the precious water we used.
Clorox - Green Works, perhaps the most successful reverse graffiti campaign to date produced by symbollix.com (Moose). Green Works did get permission to produce a mural but did they not get permissions to produce a commercial message. Shortly after the piece was completed they were asked to remove their logo. Removing their logo did not lessen the effect of the campaign which ultimately reached millions of consumers with its beautifully shot and edited YouTube video. To this day, 8 years later, the video and elated blog posts and PR are circulated organically around the internet.
NME will be happy to advise you and share years of experience in meeting with municipalities.
Truth be told, some of the most successful campaigns (based on a high level of exposure) were campaigns where brands actually got into trouble. The general public have a positive impression of natural-media and often defend the use of it. This approach requires that you are brave and is best used when you have a great PR plan in place just in case you do get into trouble. Be prepared and know how you will respond. Getting your campaign in local newspapers or featured on the internet will provide you more valuable exposure. Having a positive message (and great photos) that the press can use in their articles is key.
Natural-media is a responsible form of media that matches the sustainable ambitions of most cities. You could always take the traditional route and instead print giant paper or vinyl billboards both of which have a large environmental foot print. With natural-media the media is a big part of the message. You can use that to your advantage.