New guidelines of the Polish President of the Office for Competition and Consumer Protection on surreptitious advertising in social media of influencers.

It is unclear whether the instrumental and intentional presentation of products with the help of influencers, i.e. people active on the Internet, is a classic breach of competition law and the ban on standard advertising. An Influencer in the world of social media is an influential person who can influence their audience through their reach. These types of people are sometimes used in marketing campaigns because they can skilfully influence the behaviour of the audience. However, is this type of sponsored content properly labeled and is it likely to mislead consumers? The Polish President of the Office of Competition and Consumer Protection (UOKiK) has recently launched an investigation aimed at developing guidelines for people who earn money by promoting products online.

What is covert advertising?

Covert advertising is a form of media communication that encourages the purchase of a product or service despite its neutral overtones. There are several pieces of legislation dealing with the issue of covert advertising under Polish law. One of them is the Polish Act on Combating Unfair Competition. Art. 16 sec. 1 point 4 states that: “Art.16.1. An act of unfair competition in the field of advertising is in particular:

4) statement which, while encouraging the purchase of goods or services, gives the impression of neutral information”.[1]

Therefore, the paid promotion of products or services without clearly indicating that they are sponsored content violates the prohibition of covert advertising and may constitute an unfair market practice, and in some cases also an act of unfair competition.

Legal regulations

Both the use of covert advertising and misrepresentation of the properties of the advertised product are listed in Article 7 of the Polish Act on Counteracting Unfair Market Practices as an unfair market practice. Point 11 states that:

covert advertising consists of the use of journalistic content in the media to promote a product where a trader has paid for the promotion without that promotion being evident from the content or from images or sounds clearly recognisable by the consumer[2]

Special regulation

What is worth paying attention to is the issue of advertising drugs and dietary supplements by influencers. The pharmaceutical law regulates the issue of advertising of medicinal products in detail, advertising of prescription-only drugs is prohibited, and in the case of other drugs, advertising may not, inter alia, mislead and must present the product fairly and objectively. The same applies to dietary supplements.

Preliminary investigation

On 29 September 2021, on the website of the Polish Office of Competition and Consumer Protection, there was posted the information that work had begun to regulate advertising activities carried out on YouTube, Facebook and Instagram by influencers. Initial research into the problem has shown that much commercial content is not labelled as such. There is also content that is insufficiently labelled or labelled in a way that does not make sense to Polish audience. The investigation initiated in this case will therefore mainly focus on the relationship between the most popular influencers and brands and advertising agencies. As we can read on the website of the Polish Office of Competition and Consumer Protection “The investigation is taking place in a case and not against specific traders. The investigation will cover many entities from the industry, and in the nearest future they may expect summons from the Office. According to the regulation, failure to provide information requested by the President of the Office of Competition and Consumer Protection in the course of such proceedings or providing misleading information may result in a penalty of up to EUR 50 million”[3]

How to correctly label a sponsored message?

The main issue should be that the recipient of the advertisement should be able to read clearly that a given message is an advertising or sponsored message. Currently in Poland there are no binding guidelines in this respect, however it is worth noting the decision of the President of the Polish Office of Competition and Consumer Protection of 14 December 2014.[4] The tips contained therein can also be applied to social media, marking sponsored posts by, for example, explicitly indicating that the company has given the author a specific product to test, or even in the form of a clear hashtag, such as #advertising, #promotion.

[1] Act on Counteracting Unfair Competition Dz. U. 1993 No. 47 item 211