Social media platforms have been thriving for the past decade. Their main business models have been relying on advertising in the form of getting paid by companies – and any other interested party – to display ads in the feeds of their users. Traditionally, such ads have been mimicking the clear demarcation of advertising from the content of radio and television programmes. Decades of media regulation led to a status quo where advertising needs to be very clearly disclosed, in order to preserve the consumer’s agency and freedom of decision-making, and avoid manipulation. Yet with the rise of user-generated advertising in the form of influencer marketing, this demarcation has been not only increasingly lost, but also very much challenged. Viral videos of creators engaging in enticing story-telling can feature product placements, promote own brands of goods or services, or offer discounts through affiliate marketing. The general perception by creators is that disclosing their sponsored content can be detrimental for their reach, and thus even when they may be aware of their legal obligations, they generally choose to not comply with the law. The Digital Services Act introduced a new set of obligations for platforms that are deemed to have such a high impact on consumers that they received their own extra liabilities (Very Large Online Platforms – VLOPs). According to Art. 34 DSA, VLOPs must identify systemic risks and take mitigation strategies against them. The DSA does not define systemic risks, but it includes the dissemination of illegal content in this category. Hidden advertising is a form of illegal content, as it violates disclosure obligations under EU and national advertising rules pertaining to consumer protection. This contribution makes the argument that hidden advertising can be considered a systemic risk, first by reporting on the empirical evidence from computer science literature on the meager volume of influencer disclosures on social media, and second by addressing the impact of such non-disclosures under the DSA. In doing so, the contribution also asks whether disclosures are still relevant for social media advertising given the changing preferences and information literacy of new generations of consumers such as gen z.

About the lecturer

Dr. Catalina Goanta is Associate Professor in Private Law and Technology and Principal Investigator of the ERC Starting Grant HUMANads, focused on understanding the impact of content monetization on social media and on reinterpreting private law fairness in the context of platform governance.

Between 2016-2021 she was Assistant Professor at the Faculty of Law at Maastricht University, and during February 2018 – February 2019, she was granted a Niels Stensen fellowship and visited the University of St. Gallen (The Institute of Work and Employment) and Harvard University (The Berkman Center for Internet and Society). Dr. Goanta is also an expert trainer in the European Commission’s E-Enforcement Academy, where she gives trainings on computational investigations of European consumer protection violations on digital markets. In this context, she also co-developed the first European influencer education resource on consumer protection and social media advertising, the Influencer Legal Hub.

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About the lecture series