The Polish Office of Competition and Consumer Protection (the “Office”) has been investigating influencer marketing practices for quite some time. The first charges, which were issued in 2022, concerned surreptitious advertising and a lack of cooperation with the Office (our article on this topic is available here). These were then diligently followed up on with official guidelines issued by the Office and addressed to influencers which examined the intricacies of cooperation with business partners, self-promotion and PR gifts (the “Guidelines”), published in September 2022. A year later, the Office is saying “take another look” and issuing further decisions resulting in total financial penalties amounting to over EUR 1 million (PLN 5m). This article provides an overview of recent developments affecting influencers engaging in marketing in Poland.
While there are no specific laws concerning social media labelling, it is crucial that advertisements do not mislead consumers. According to the Office, two key unfair practices of relevance for this area are misleading omissions and surreptitious advertising. Misleading omissions can cause consumers to make decisions they would not otherwise make because they lack essential information. On the other hand, surreptitious advertising occurs when paid promotions are hidden in mass media content, making it hard for consumers to identify them. Both practices are addressed in the Polish Act on Countering Unfair Market Practices.
Given the above, the labelling of advertising materials should be clear, readable, and understandable to consumers. The aim is therefore to protect social media users from hidden advertising and allow them to make an informed choice about whether they wish to familiarise themselves with commercial content.
The Guidelines set practical rules for both influencers and their business partners on how to put into practice applicable provisions in the area of labelling advertisements, self-promotions and gifts policies. A short overview of the main rules issued by the Office is presented below.
Promoting events and sharing opinions
Not all forms of collaboration equate to advertising. For instance, if an influencer receives a free event ticket, but is not required to promote it, they can post about it without marking it as an advertisement. However, if additional expenses are covered by the advertiser, it should be labelled as advertising.
Importantly, the Office applies a rather broad interpretation of remuneration. Products or services, discounts on the purchase of products or services, profits from the publication of discount codes, affiliate links, licenses granted, promotional vouchers, bonuses, coverage of additional costs of participation in an event in addition to the admission ticket, but also an increase in sales of the influencer's own goods or services, all qualify as remuneration under the Guidelines.
For product testing, influencers only need to disclose the source of the product and their non-payment, assuming they return the product post-review. For non-returnable items, the Office's general approach suggests it should be marked as advertising.
Brand ambassadors must label all cooperative content as advertising. For example, if a car manufacturer's ambassador gets a car, they must indicate it as advertising whenever the car appears in their social media content.
The position of the Office is that if an influencer decides to publish when they receive a first gift from a brand, he or she does not have to label this content as advertising material. However, the influencer should inform his/her followers that the product was received as a gift.
Publications of repeat gifts from the same brand (or its affiliates) should be marked by the influencer as advertising material. This is because the Office argues that repeat gifts may constitute remuneration from the brand for the influencer's publications, even though the parties have not entered into any agreement.
Advertising materials should be distinguished from other content, shown in a conspicuous place, the font should be clear and large enough, the text should be in Polish (if the influencer’s profile is in Polish) and the terms used should clearly indicate the commercial nature of the post. The influencer must also inform what brand he or she is advertising.
The Office recommends two-tier tagging - i.e., using both the social network's built-in functionality for tagging content (e.g., "sponsored post" on Instagram) and actions taken by influencers themselves (as a hashtag, in the post description or directly in the video/photo).
The Office considers misleading non-recommended labels that:
Inappropriate labelling can result in sanctions against the influencer, advertiser and advertisement agency (including under recourse liability, e.g., the influencer in relation to the advertisement agency for illegal content labelling requirements in the contract) which can take the form of regulatory sanctions against the influencer and/or its business partner (including a financial penalty of up to 10% of the turnover generated in the year preceding the imposition of the sanction) but also sanctions applicable to market competitors (related to any act of unfair competition).
The Office has recently imposed penalties totalling over PLN 5 million on Olimp Laboratories (one of the Polish leaders in the dietary supplements industry) and three associated fitness influencers for incorrect labelling of advertising materials on social media. This decision marks the first penalties for both influencers and their business partner for incorrect ad labelling.
The practices questioned by the Office consisted in posting sponsored materials without marking them as advertising or doing so in a way that did not clearly indicate their commercial nature. Despite ongoing investigations, Olimp Laboratories continued to recommend unclear and user-unfriendly advertising practices to the influencers. The Office highlighted Olimp Laboratories' role in creating commercial content that wasn't compliant with advertising regulations. The Office also stressed that the responsibility to disclose paid collaborations lies with all the parties involved, including internet creators, agencies, and advertisers.
In conclusion, it is vitally important to underscore that the Guidelines, while not legally binding, serve as valuable guidance for influencers and businesses on how to operate within legal boundaries and avoid potential liabilities. While this regulatory effort is laudable, there remain concerns regarding the necessity for overly explicit advertising content communication. For instance, a label such as "#cooperation" without the word "paid" is considered misleading.
Further, the content created by influencers often possesses creative flair, even when sponsored. There is a potential risk that the Guidelines might impinge upon the creative and aesthetic essence of such content.
And lastly, the activities of the Office in the area of influencer marketing should be carefully noted not only by influencers themselves but also by their business partners. Depending on the scale of their operations, entities might find the financial penalties associated with non-compliance quite substantial.