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Office of Competition and Consumer Protection

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Over 5 million fine for surreptitious advertising on Instagram

< previous | next > 28.08.2023

Over 5 million fine for surreptitious advertising on Instagram
  • President of UOKiK Tomasz Chróstny has imposed a fine totaling over 5 million PLN for improper tagging of advertising materials on social media.
  • Decisions relate to Olimp Laboratories, one of the leaders in the dietary supplement industry, and three influencers from the fitness industry.
  • These are first fines imposed both on the authors and on the advertiser for improper tagging of advertising content.

After almost a year since the publication of the Recommendations on tagging advertisements on social media, numerous educational activities as part of the #OznaczamReklamy campaign, President of UOKiK Tomasz Chróstny has imposed first fines for surreptitious advertising and misleading consumers.

The proceedings have confirmed the charges against the Olimp Laboratories company and three cooperating influencers. While publishing sponsored materials in line with the guidelines from the advertiser, the authors failed to tag them at all or did it in a way that did not directly indicate the commercial nature of the published materials.

- We are persistent in eliminating practices of improper tagging of advertising content on social media. During the intervention, we apply various tools. We have prepared Recommendations which refer to the best practices compliant with the laws that have long been in effect. We have held extensive educational campaigns. We have provided the room for aligning all entrepreneurs involved in promoting commercial content online. Now the time has come to enforce those rules - concludes Tomasz Chróstny, President of UOKiK.

 

Olimp at the top

Over 5 million PLN – this was the total amount of the fine imposed by the President of UOKiK on Olimp Laboratories for surreptitious advertising on social media. The entrepreneur manufactures medications, medicinal products, dietary supplements, and special purpose medical food. Since 2015, it has been using social media advertising and has been cooperating with influencers who are watched by hundreds of thousands of people. The analyses by UOKiK prove that the company paid influencers for placing their products in posts and stories, in line with the guidelines it had provided. At the same time, it recommended the use of unclear tags for advertising materials – among others, those referring exclusively to the brand of the advertiser @olimp_Nutrition_pl, names of individual products, or English slogans, such as #olimpad. The nature of the tags used and frequently also their location meant that their commercial nature was not evident in the published materials. What is more, despite the already-pending preliminary investigation, the company advised the authors neither to disclose the commercial purpose nor to use the formula, content, and form of promotion which was unclear for users without any explicit indication that it involved advertising.

In his decision, the President of UOKiK drew special attention to the role played by Olimp Laboratories in the process of creating commercial content. The advertiser, as a professional enterprise, created and shared illegal recommendations with co-operating influencers, demanding that they be applied. The obligation to disclose paid cooperation lies both on online authors and agencies, as well as advertisers. They are not allowed to forward any guidelines which are contrary to the proper tagging of advertising content or suggest that the applicable laws could be circumvented.

Ultimately, in January 2023, the company ceased to apply the challenged practice and currently applies the recommendations aligned with the Recommendations of the President of UOKiK in relationships with online authors.

 

Influencers at the bottom

Online authors did not manage to avoid fines, either. As part of the proceedings, detailed analyses were made with regard to the cooperation between Olimp Laboratories and Katarzyna Dziurska, Katarzyna Ole¶kiewicz-Szuba, and Piotr Lisek on promotional and advertising services rendered on their accounts on Instagram. Following the decision of the President of UOKiK, the authors charged received fines of more than 40 thousand PLN.

- The opinions and recommendations of influencers affect consumers’ purchasing decisions. Research proves that among the youngest consumers (15-24 years of age) almost 90 percent read stories by influencers while more than half purchase a product or service if it had been recommended by an author they follow. This value goes up to 63 percent in the group which regularly watches the influencers’ stories. Thanks to the relationship developed with followers which relies on trust, the opinions of online authors are perceived as reliable and impartial. Paid promotion of products or services without a clear indication that they are sponsored content should not take place as it is misleading to consumers and may constitute an unfair market practice - explains President of UOKiK Tomasz Chróstny. 

This is how Piotr Lisek (with a fine of more than 23 thousand PLN), Katarzyna Dziurska (fined in 16 thousand PLN), and Katarzyna Ole¶kiewicz-Szuba (with a fine of 5 thousand PLN) worked in promoting products of various companies on their social media. Each of them signalled commercial cooperation with the use of tags referring exclusively to brands of individual advertisers or other designations which did not indicate the commercial nature of the published material – for example, by promoting some products of Olimp Laboratories: “olimpad”. Some content appeared with no indication at all that might have suggested that it was sponsored. Therefore, consumers might have been unable to differentiate which posts or stories were paid for, and which constituted an independent opinion of the influencer on the products presented. Three influencers ceased to apply the challenged practices.

In the course of determining the fines, President of UOKiK took account of the fact that the authors had followed the recommendations of a popular, large advertiser in publishing sponsored materials. There is no doubt, however, that as entrepreneurs operating in the influencer marketing industry, they should be aware of the applicable rules pertaining to tagging advertising content.

 

Unclear tagging? It’s not worth a penny

Interventions of President of UOKiK regarding the influencer marketing industry have been taking place since September 2021. In June 2022, the following persons were fined for lack of cooperation with UOKiK in the course of the preliminary investigation, for an aggregate value of 139 thousand PLN: “MD” Marcin Dubiel, “Maffashion” Julia Kuczyńska, Marcin Malczyński, “Marley” Marlena Soyka (legally binding decisions) and Paweł Malinowski (unsafe decision, case in court of 1st instance – Court of Competition and Consumer Protection, SOKiK) and “Kruszwil” Marek Kruszel (SOKiK dismissed the appeal of the entrepreneur, unsafe decision).

Since February, President of UOKiK has been conducting three proceedings, against Filip Chajzer, Dorota Rabczewska, and Małgorzata Rozenek-Majdan, who were charged for failure to tag advertisements on their channels on social media. These cases may result in fines for violating collective interests of consumers of up to 10% of the turnover.

- Tagging advertising materials should be unambiguous, clear, and understandable for each and every social platform user. We want consumers to be protected from hidden advertisements and to be able to make an informed choice about whether they want to familiarise themselves with the content of commercial nature. This is a matter of fairness towards followers, other influencers, brands, or agencies. The need for transparently tagging commercial content has also been reported by social media users. As many as 85 percent of them think that influencers should clearly tag materials in which they promote and encourage the purchase of their own products or services - states President of UOKiK Tomasz Chróstny.

How to do it legally?

The commercial nature of the published materials is unambiguously indicated by phrases such as: “advertisement,” “sponsored material,” or “paid cooperation.” Shortened names and English expressions may not be understood by recipients. On the other hand, the requirement of legibility of the advertising material involves first and foremost the provision of adequate visibility of those elements. Appropriate placement of tags and the use of an adequately large font visible against the background may be helpful in that regard.

Additionally, President of UOKiK recommends simultaneous use of the functionalities of individual social media which offer default solutions dedicated to tagging advertising materials (so-called two-level tagging). We explain how to correctly tag advertisements, self-promotion, and gifts in the Recommendations of President of UOKiK, section “Questions and Answers,” and at uokikgovpl on Instagram.

The research quoted in this press release was made in November 2022 upon request of UOKiK by SW Research, an independent research agency. Results can be found at uokik.gov.pl.

Consumer Support:

Phone: +48 801 440 220 or +48 222 66 76 76 – consumer helpline
E-mail: [SCODE]cG9yYWR5QGRsYWtvbnN1bWVudG93LnBs[ECODE]
Consumer Ombudsmen – in your town or district

Additional information for the media:

UOKiK Press Office
pl. Powstańców Warszawy 1, 00-950 Warszawa, Poland
Phone: 22 55 60 246
Email: [SCODE]Yml1cm9wcmFzb3dlQHVva2lrLmdvdi5wbA==[ECODE]
Twitter: @UOKiKgovPL
You can also follow us on Instagram: @uokikgovpl

Attached files

 

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