Legal regulation of advertising by influencers in Lithuania

For a long time, influencer marketing went through a ‘Wild West’ period—each stakeholder made the rules of communication and promotion as they wished. As this market has been growing rapidly, legal regulation of the content of influencers has inevitably followed. In Lithuania, there are guidelines on the labeling of social media advertising issued by the State Consumer Rights Protection Service, which define the equivalence of influencers’ communication to other forms of advertising. However, this is far from being the only document that should be consulted by all those who advertise on social media. So what is important to know in order to create transparent and ethical advertising?

#Ad that we still haven’t learned to disclose

Despite the space left for interpellations, the guidelines on advertising marking published at the end of 2019 have put together the key points between advertisers, intermediaries, and influencers. One thing has become clear—all advertising, whether financial or exchange-based, must be disclosed with a hashtag or simply with the word ‘advertising’ in the native language of the market. The change in the market is evident: today, there are far fewer cases of untagged advertising, but in certain areas described in the guidelines, disclosure of advertising somehow does not exist.

The most active non-disclosure of advertising is seen in the commercial activities of influencers or, in other words, in the advertising of their own businesses. An influencer who talks about products in a client’s e-shop tags the advertisement but forgets the hashtag #advertising when inviting followers to buy new items from their page. Influencers must also comply with legal advertising regulations when talking about the products or services they sell on their accounts because inviting followers to visit their restaurant to try out a new menu, browse their clothing collection, or book a consultation encourages the audience’s decision to buy.

Another popular example of improper disclosure of advertising is gifts sent by brands to influencers. Tagging gifts is quite simple—just write #gift or “Thank you to brand X for giving me Y”. However, such tagging is only appropriate until the influencer starts expressing their opinion about the gift. If the influencer starts to praise the brand, the product received, invites followers to visit the brand’s website, or even shares a discount code that they unexpectedly received when sharing the gift with their followers, the content must be disclosed as an advertisement. 

The best advertisement for cream is the true one

Those experienced in the field of advertising dissemination know that tagging or clear disclosure of advertising is just one of the characteristics of ethical and legal advertising. Equally important are the claims used in advertising, the legitimacy which is rarely considered by influencers, and some advertisers fail to inform their advertising partners of the importance of such claims and the legal liability they may incur.

The cosmetics and food supplement product categories face the most legal complexities. Cosmetics and food supplements advertising is prohibited from using claims, images, or other signs that suggest, figuratively or otherwise, that the products have properties or functions that they do not have or that imply that the products cure human diseases or that the products have preventive effects. Simply put, when promoting anti-aging cosmetic products, both the brand and the influencer cannot claim that the cream is ‘anti-aging’ or ‘wrinkle-fighting’, while when introducing food supplements, they cannot say that the product will ‘help to solve low iron levels’. 

However, it is naïve to expect every influencer to be thoroughly familiar with the advertising regulations in the different industries, so the onus is on the advertiser to ensure that the advertiser is properly informed.

Creativity that defies bans

In Lithuania, we also have categories of goods and services that are subject to advertising bans (alcohol, tobacco) or restrictions (gambling and health services, and medical devices). The very notion of banned advertising should seem to be a moot point, but brands operating in these industries often try to circumvent the laws in force in the country in various ways and reach their audiences through influencers.

Brands whose products are banned from advertising become very creative in these circumstances. An alcohol brand can create a line of stylish clothes to dress influencers, and when a bright jumper tempts the consumer, they visit the online shop. They are greeted by the recognizable logo of an alcoholic beverage. Tobacco manufacturers or distributors pull similar tricks out of the hat, presenting e-cigarettes in influencers’ communications through colorful packaging and a wide range of flavors, from raspberry to lemonade, as if to disguise the product’s real purpose.

Lithuania does not have an absolute ban on gambling advertising, but there is little room for improvisation. On 4 May 2021, the Gambling Supervisory Authority clarified that it is prohibited for gamblers, influencers, and other persons to solicit in any way to try gambling, to conduct demonstration gambling, to report gambling winnings by referring to a specific gambling operator, or to disseminate information about gambling operators in any other way. It is worth noting that the restriction on advertising also applies to restaurants and bars located in gambling venues, as influencers receive a large number of proposals to advertise such venues.

Clinics and medical brands also find it difficult to reach their target audience through influencers. According to a clarification by the State Consumer Rights Protection Service, the use of a patient’s name and image in advertising for healthcare services and medical devices is prohibited. In other words, in the advertising of these services or products, the influencer is legally treated as a patient, and according to Article 15 of the Law on Advertising of the Republic of Lithuania, the patient’s consent to the public use of their image and name does not exempt them from the prohibitions laid down in the law, provided that the information disseminated constitutes advertising.

Brands facing bans will continue to look for creative, but not necessarily ethical, ways to advertise, so it is up to the influencer to determine what requirements they place for their partners and how much research they do before they take on an offer.