The Italian Competition Authority Opens a Hidden Influencer Marketing Proceeding against British American Tobacco Italia S.p.A. And Three Influencers

On May 31, 2021, the Italian Competition Authority (“Authority”) opened a proceeding against the Italian unit of the tobacco giant British American Tobacco, i.e., the company British American Tobacco Italia S.p.A. (“BAT Italia”), and influencers Stefano De Martino, Cecilia Rodriguez, and Stefano Sala—all three of whom, according to the Authority, have commercial relationships with BAT Italia. The proceeding regards possible hidden advertising conducted through the influencers’ Instagram pages.

The proceeding falls under the Authority’s efforts to combat hidden influencer marketing practices on social media platforms, particularly in connection to the posting of content by influencers who do not duly disclose to the public the commercial relationships they have with the relevant brands and, thus, the advertising nature of such content. The Authority’s actions formally started in 2017, when it sent a first round of moral suasion letters to some famous brands and influencers. The actions continued over the years with a second round of moral suasion letters in 2018, as well as with the opening of targeted proceedings. All such proceedings so far have concluded with the Authority accepting the undertakings proposed by the brands and influencers involved.

The most recent proceeding opened by the Authority against BAT Italia is the first related to potential hidden influencer marketing social media practices in the tobacco and related products industry and confirms the Authority’s growing interest in this type of practice, regardless of the sector in which the involved brand operates.

Specifically, according to a press release issued by the Authority regarding the start of the proceeding (PS12009), the three influencers in question invited their followers to post content on their respective Instagram pages using tags and hashtags linked to an advertising campaign related to BAT Italia’s heated tobacco device “Glo Hyper” without – however – “the advertising effect obtained by the influencers, as resulting from such tags and hashtags, being recognizable in its commercial nature, given the absence of textual or graphical warnings suitable to identify the relevant promotional purpose”. On May 27, 2021, inspections were carried out at BAT Italia’s premises with the help of the Special Antitrust Unit of the Guardia di Finanza.

The full text of the notice announcing the proceeding against BAT Italia is currently not available, so the date of the Instagram posts the Authority is putting under the microscope remain unclear; similarly, it is not perfectly clear whether the influencers’ call to action directed at their followers was fully or only partially lacking warnings suitable to inform the public about their commercial relationships with BAT Italia and the promotional intent behind the practice. The difference between the two scenarios is substantial to determine the scope of the Authority’s investigation and the consequences that its outcome may have with regard to transparency in advertising and its effect on digital customer engagement practices which, like those in question, are becoming increasingly widespread.