Financial Penalties Upon Influencers for Lack of Cooperation With the Polish Authority

Recently, Polish Office for Competition and Consumer Protection (“OCCP”) has imposed financial penalties on influencers against whom it has initiated proceedings in autumn 2021 for the lack of cooperation. Six decisions were issued for a fine of total amount of almost 30 thousand Euros.

 In 2021 the Office has initiated proceedings against influencers who published on social media content indicating that it may be sponsored (what can violate the laws on the consumers; and competition protection). As part of the ongoing investigations into the labeling of commercial content on social media and suspected scam, the OCCP’s President inquired dozens of leading Polish influencers to collect information about the functioning of the influencer marketing industry and verifying the accuracy of their labeling of commercial content on social media. The Office asked influencers to be provided with:

• description of their business,
• turnover achieved in the previous calendar year,
• rules they follow when tagging posts,
• information on whether they received other material benefits out of the commercial cooperation,
• copies of contracts concluded with brands, celebrities or agencies.

Financial penalties

Unfortunately, several influencers questioned did not provide information or did not send the documents requested by the Office. Failure to respond the Office has legal and financial consequences - it is a violation of the law and can end up in a financial penalty of up to 50 million euros. With all the circumstances in mind, the President of the CCP issued 6 decisions and the amount of the penalty was established at almost 30 thousand Euros. The decisions rendered are not final however and the influencers still have the right of appeal to the court.

Agencies, contracts and ads on notice

As part of investigations, the Office examined profiles of the most popular influencers and their contracts, checking terms of cooperation and arrangements with advertisers - brands and marketing agencies. Among other things, specific reasons for negligence in marking sponsored posts were investigated to find out when the blame lies with the creator, and when hiding the nature of the advertisement is required by the principal himself. The aim of the investigation is to change the social media advertising market and eliminate negative practices that harm consumers.

Consultation in progress

The President of the OCCP is currently leading a consultation with users, industry organizations and marketing agencies. The aim is to develop recommendations for social media users on labeling commercial content. As the OCCP informs, Academics - the Department of Journalism, Information and Bibliology at the University of Warsaw and the Department of Press Systems and Press Law at the Faculty of Political Science and Journalism at Adam Mickiewicz University – have also joined the discussion.

“We want to guide the market accordingly by showing real-life examples. At the same time, for now we will not  regulate the issue of, for example, the use of photo retouching in marketing posts” - explains Tomasz Chróstny, the President of the OCCP. The President considers that an influencer is a creator of content that influences his or her community and no matter whether he publishes on YouTube, TikTok, Instagram or other platforms. “When we surf the web and peep into the lives of our favorite celebrities, we don't want them to subliminally sell us, for example, to creativity-enhancing shoe insoles that they haven't even tested," adds the OCCP’s President.

Consumer education

The OCCP actively reaches out to consumers through modern media, including Instagram. Recently the Office published a guide for consumers – “Instatips”, where it documents how great power influencers have to affect consumers. The guide also regulates:

• premises for crypto-advertising,  
• organization of sweepstakes and contests by influencers and
• correct ways to label advertising/sponsored content. The appropriate designations are i.a.: #advertising cooperation, #advertising or #advertising material. It is important that they are expressed in Polish language.

The office also encourages consumers to check if a recommended shop (under disclosed hyperlink) is not dropshipping as well as to ask influencers questions in the comments in case they have any concerns regarding the post, its content or products. If consumers feel that the materials are marked incorrectly, they can notify the Office by e-mail.

Under the Polish law, misled consumers can demand: compensation for damages, abandonment of unlawful practices and elimination of their consequences (on virtue of the Act on counteracting unfair market practices).