GDPR – Entry into force and field of application

16 März 2018

Italien

Privatsphäre - Datenschutz

The relationship between influencers and advertising is one of the most interesting topic of the recent years, and one to which many operators in the sector are devoting energy and money.

In this article we will return to talk about the legal problems that influencer marketing makes it necessary to analyze.

There are many problematic profiles that can arise from the activity of influencers, pursuant to a fundamental principle of advertising discipline: any form of commercial communication and/or advertising must clearly be recognizable as such.

It is known that influencers, thanks to the reputation they have on social network, Instagram among all, are often paid to post pictures that portray them along with products given for free companies that have sponsored the post itself. The situation described can well be considered as a real advertising activity, considering that there is an individual that receive remuneration for promoting a product to the community. However, in the sponsored post there is no mention of the fact that the activity carried out by influencers is a genuine and effective advertising activity: the influencers simply post the picture and describe the product , obviously in a positive way, as if it were “a private story in the style of Instagram“ (injunction of the Italian Advertising Self-Regulatory Institute (IAP) Control Committee no. 57/2018).

It is certainly on the basis of these considerations that, in the last two months, we have assisted to a real crackdown in the IAP, the Italian Advertising Self-Regulatory Institute (“Istituto di Auto-disciplina Pubblicitaria). The IAP Control Committee notified many influencers, as well as the companies producing the good displayed in the sponsored posts, injunctions aimed at inhibiting the publication of certain posts released by the influencers themselves.

The common element of all these injunctions is the criticism of a behavior that showed a purely advertising activity as if it were a spontaneous choice of the influencer. This circumstance leads to a situation in which, using the words of the IAP injunction No 61/2018 of 14 June 2018, there are “communication conveying eminently promotional content of the product and the brand in question, that is however not sufficiently explicit and therefore not immediately recognisable to the public”.

In fact, what is being contested in the above-mentioned injunctions, but also in others, such as in the injunction no. 51/2018, is the violation of art. 7 of the Italian Marketing Communication Self-Regulation Code (“Codice di auto-disciplina pubblicitaria). The code is the source of the above-mentioned principle that states that any form of commercial communication must always be recognisable as such. Furthermore, the Code says that „in the means and forms of commercial communication in which contents and information of other kinds are disseminated, commercial communication must be clearly distinguished by means of appropriate measures„.

The measures taken by the Control Committee involve not only influencers, but also companies, as the latter actually benefit from an activity that can be considered a form of surreptitious advertising.

Please, allow me a note.

Take for example the injunction no. 50/2018, regarding two Instagram’s posts of the influencer Chiara Nasti, that portrayed her with products marked with the trademark „Sunsilk“: having noted that the two posts of Nasti’s Instagram profile violated the above-mentioned art. 7 of the Italian Marketing Communication Self-Regulation Code, the injunction states the essential need for „transparency of communications„, that allows an effective distinction, and not a merely formal one, of promotional communications from any other type of communication.

Analyzing the guidelines elaborated on this matter by the IAP, the so-called „Digital Chart“, it results that it is considered compliant for the purpose of the recognition of an advertising communication as such, that a post on Instagram or on another social network presents the hashtag #advertising, or even simply the hashtag #ad.

In this respect, the IAP’s guidelines may leave a little baffled. In fact, while recognizing that the choice in question is an attempt to mediate between the need to protect the consumer and the activity of influencer, it is legitimate to doubt about the effectiveness of the hashtag #ad. As a matter of fact, it is reasonable to doubt that the hashtag #ad, written under a picture on a social network, is in itself suitable to make it clear to the user and to the average consumer that the post ha an advertising message. In fact, it can be assumed that many users do not know that the term „ad“ is the abbreviation for „advertising“, especially considering that the average user of influencers is represented by young people aged between 14 and 18 years. In a nutshell, the hashtag #ad would be able to “disguise” the advertising activity.

On the other hand, the Italian Competition Authority (AGCM – Autorità Garante della Concorrenza e del Mercato) and some German judges (and the German legal system is known to be particularly attentive to new technologies law) also reached these conclusions. In this respects, it is worth reading the Case 13 U 53/17 of the Celle Higher Regional Court, that concerns to precisely the hashtag #ad and reaches conclusions similar to those mentioned above.

It should also be noted that, so far, it has been mentioned the Italian Marketing Communication Self-Regulation Code, a regulatory text issued by the IAP, whose injunctions or decisions bind exclusively the companies adhering to its system of self-regulation.

However, it is clear that, in cases such as those described above, is applicable a specific Italian legislation, the so-called Consumer Code (Legislative Decree no. 206/2005 – Codice del Consumo), Furthermore, surreptitious advertising violates the prohibition of misleading and unfair commercial practices, as stated in various articles of the Consumer Code.

The consequences are relevant, because the Consumer Code and its Implementing Regulations implicate the intervention of the Italian Competition Authority (AGCM) or the Italian Regulatory Authority for Communications (Agcom – Autorità Garante per le Comunicazioni), both having sanctioning powers toward any person (with particular reference to financial sanctions).

What arises from this brief examination is that this phenomenon is particularly interesting and widespread throughout the world.

The author of this post is Elena Carpani.

Last 7 June, legislative decree no.63 of 11 May 2018 implementing EU Directive no.2016/943 of 8 June 2016 on “on the protection of undisclosed know-how and business information (trade secrets) against their unlawful acquisition, use and disclosure”, was published in the Official Journal of the Republic of Italy, pursuant to article 15 of Delegated Law no. 163 of 25 October 2017.

The purpose of this act was twofold: on the one hand, it assisted in matching the already existing Italian legislation – in particular, articles 98 and 99 of the Italian Code of Industrial Property – with the new EU legislation; whilst, on the other hand, it implemented new and more effective provisions of law on the protection of trade secrets.

The European Union introduced Directive no. 943/2016 in order to harmonize and ensure consistent protection of know-how and trade secrets on European level: in fact, irrespective of article 39 of the TRIPs Agreement, Italy was the only EU member having a domestic definition and a specific protection of trade secrets and no EU law has been passed governing their unlawful acquisition, use or disclosure. This factor weakened the ability of several countries to protect one of the most prominent intangible assets for industry 4.0 and next-generation innovative businesses.

Amid this European scenario, Italy maintained a privileged position vis-à-vis most of the other Member States, since provisions for specific protection of business know-how and confidential information had already been laid down under articles 98 and 99 of the Italian Code of Industrial Property. This is why Italian lawmakers intervened in articles 98 and 99 of the Italian Code of Industrial Property to merely replace the former language “business information and expertise” with the notion of “trade secrets”, while basically leaving the protections envisaged in article 98 of the Italian Code of Industrial Property unchanged to its earlier version, which was already in line with the EU rules.

Apart from this, the legislative decree supplemented the applicable rules and improved the standards of protection of trade secrets, pursuant to EU Directive no. 2016/943, to enable judicial decisions in protection of trade secrets to be weighed against, inter alia, the significance of such information, its importance for the claimant, and the precautionary measures implemented by the owner thereof.

In the first instance, paragraph 1-bis of article 99 of the Italian Code of Industrial Property has been introduced to take negligent behaviours into consideration on the matters of infringement of trade secrets, so that the acquisition, use, or disclosure of trade secrets may be held unlawful even when, at the time of the challenged circumstances, the individual was, or should have been, aware, as the case may be, that the trade secrets had been directly or indirectly obtained by the party that unlawfully used or disclosed them.

Quite the reverse, article 9, paragraph I, of the Directive has been fully implemented in article 121-ter on the preservation of confidentiality of trade secrets in the course of legal proceedings, irrespective of these being for precautionary measures or on the merits of the unlawful acquisition, use or disclosure of such trade secrets. According to such new provision of law, any (ordinary, civil or criminal, administrative or accounting) court of law will be entitled to prevent the counterparties, their representatives and advisors, legal counsels, clerical staff, witnesses, any court-appointed or delegated experts, and any other persons having access to the decisions, briefs and documents included in the court file, from using or disclosing the trade secrets discussed in the proceedings that the court may classify as confidential. In addition, it is expressly provided that such a prohibition shall maintain full force and effect after the conclusion of the proceedings in which scope it was imposed, while vice versa its effectiveness will be forfeited (i) in the event that the lack of the requirements set out in article 98 of the Italian Code of Industrial Property in order to have a valid trade secret is assessed by ruling, or (ii) where the trade secrets fall in the public domain or become easily accessible to industry players and experts.

Furthermore, in the same article specific measures were laid down for the preservation of confidentiality of trade secrets in the course of legal proceedings: hence, subject to compliance with the principles of fair trial, the judge will be entitled to adopt the most appropriate measures to preserve the confidentiality of the trade secrets discussed in the trial. Besides, the article explicitly sets forth two of the measures available to the judge: i.e., restricting access to hearings, briefs and documents included in the court file; and ordering the clerks to conceal the specific parts containing the trade secrets from the documents filed in the proceeding. However, because policymakers did not deem it appropriate to enable the judicial authorities to impose such prohibitions and measures by operation of law, they preferred leaving any request in this respect to the parties’ initiative, owed to the apparent high technical expertise required to appraise the confidential nature of such trade secrets.

With a view to ensuring a more accurate and effective preservation of trade secrets, criteria have been laid down (in article 124, paragraph 6-bis, of the Italian Code of Industrial Property), which the Judge will be bound to uphold when establishing the remedies and civil sanctions – and assessing whether these are suitable – in the proceedings on the matters of unlawful acquisition, use or disclosure of trade secrets under article 98. For this purpose, the Court is required to take into consideration the material circumstances of the case at issue, among which:

the value and other specific features of the trade secrets;
the measures implemented by the legal holder to protect the trade secrets;
the actions carried out by the infringer to acquire, use or disclose the trade secrets;
the impact of the unlawful use or disclosure of the trade secrets;
the parties’ legitimate interest, and how this may be affected by the endorsement or rejection of the judge’s measures;
the legitimate interest of third parties;
the interests of the general public; and
the need to ensure protection of the fundamental rights.

Not only will the Judge be bound to take these circumstances into consideration in the course of the proceedings on the merits, but also upon issuance of the precautionary measures sought by the trade secrets holder, and upon appraisal of their suitability, based on the explicit warning contained in new paragraph 5-ter of article 132 of the Italian Code of Industrial Property. Consequently, the Judge will issue a preliminary injunction or another interim measure only if the requesting company proved having adopted all the necessary measures and internal protocols to keep a given trade secret confidential.

According to new paragraph 5-bis of article 132 of the Italian Code of Industrial Property all proceedings aimed at seeking protective measures for trade secrets, as an alternative to the application of the precautionary measures, the judge may authorise the defendant to continue to use the trade secrets, subject to providing an appropriate security for compensation of any damages suffered by their legitimate holder, in any event, without prejudice to the prohibition to disclose the trade secrets authorised for use.

The precautionary measures adopted in protection of the trade secrets may be forfeited either for failure to commence the proceedings on the merits within the mandatory deadline (set out in article 132, paragraph 2, of the Italian Code of Industrial Property), or as a result of the claimant’s actions or omissions. Where the unlawful acquisition, use or disclosure of the trade secrets are subsequently found to be groundless, the claimant will be sentenced to repay the damages caused by the adopted measures.

As a further novelty, Legislative Decree no. 63/2018 introduced a compensation, payable as an alternative to the application of the measures under article 124 of the Italian Code of Industrial Property, which may be granted upon the interested party’s application, provided that all of the following requirements laid down by new paragraph 6-ter of article 124 of the Italian Code of Industrial Property are met: at the time of the use or disclosure, the claimant was not, nor should have been, aware that the trade secrets had been obtained by the third party unlawfully using or disclosing them; the execution of these measures would be unduly burdensome for the claimant; the compensation is commensurate to the damages suffered by the party seeking the application of relieving measures and, in any event, it does not exceed the amount that would have been paid on account of royalties for the use of the trade secrets throughout the challenged period of time.

A statute of limitations has been established in 5 (five) years for rights and actions connected with such misconducts.

As a final provision, in line with the availability of progressive measures and enhanced accuracy and effectiveness of trade secrets protections, which are the EU Directive basic principles, a list of the items is provided which the judge ought to appraise to order the publication of his ruling, and to weigh the suitability of the claimed measures: the value of the trade secrets; the actions carried out by the infringer to acquire, use or disclose the trade secrets; the consequences of the use or disclosure of the trade secrets; the risk of the infringer carrying on with the unlawful use or disclosure of the trade secrets.

Furthermore, to make the above appraisal the Judge shall also consider whether, based on the available information, a natural person may be identified as the actual infringer and, in the affirmative, whether the publication of such information is justified in the light of any potential damages that may be caused to the infringer’s private life and reputation.

In conclusion, articles 388 (wilful failure to enforce a court decision) and 623 of the Italian Criminal Code (disclosure of trade or science secrets) have been amended to improve the criminal reliefs granted under the Italian legal system, so as to include breach of trade secrets, and the measures connected therewith, among the misconducts sanctioned under the above provisions.

All that considered, a new approach in adopting internal rules and compliance’s procedures is required to companies and trade secrets owners in order to protect their confidential information and to safeguard their judicial protection and new language shall be adopted in drafting non-disclosure agreements: as a matter of fact NDAs were in the past very often merely copied and/or downloaded from the web without any juridical care and the due attention.

“Influencer Marketing” is a very well known topic to the jurists and operators of the advertising sector dealing with commercial communication.

There is a core principle in communication law: any form of commercial communication shall be clearly recognizable as such.

Before the diffusion of digital communication and, along with it, the proliferation of the so-called „Influencer Marketing“, the issue of recognizability of commercial communication was generally discussed when evaluating whether an advertising content was clearly distinguishable from a journalistic or an informative content (such is the longstanding issue regarding the advertorial).

For a short period of time there was a debate regarding the so-called subliminal advertising, which eventually fell into oblivion.

The necessity to point out to the consumer whether the appreciation for a product or a service shown by a well-known person – precisely an “Influencer” – (i.e. the endorsement) is genuine or not has become a much encountered and controversial topic.

It shall not be considered as spontaneous when an individual receives remuneration for wearing a fashion item, for using a smartphone, or simply when he/she receives as a gift the products that he/she promotes or other valuable products.

It is clear and proven that the spontaneous choice of an “idol” by the public has a bigger impact on these same people rather than any traditional way of advertising. Hence the abuse of surreptitious advertising on the less easily monitored channel: the web, precisely.

What measures should be taken to ensure that the consumers can understand clearly whether a post is subject of a contract or not?

The answer would be very simple.

It would be enough to require the sponsored post to contain, in clearly visible characters, terms as “Advertisement”, “Sponsored by”, “Commercial agreement” or similar notices.

In Italy, in absence of a law regulating specifically the matter, both the Istituto della Pubblicità (Italy’s Advertising Self-Regulatory Institute) and the Autorità Garante della Concorrenza e del Mercato (the Competition Authority) have expressed their opinion on this subject.

In the Italian Advertising Self-Regulatory Institute’s digital chart it is written: “in order to make the promotional nature of content posted on social media and content sharing sites recognizable, celebrities/influencers/bloggers must at the top of their post state in a clearly distinguishable manner the words: “Pubblicità/Advertising”, or “Promosso da … brand/Promoted by…brand” or “Sponsorizzato da…brand/Sponsored by…brand” or “in collaborazione con …brand” or “in partnership with the …brand”; and/or within the first three hashtags (#) use one of the following terms: “#Pubblicità/#Advertising”, or “#Sponsorizzato da … brand/#Sponsored by the … brand “ or “#ad” along with “#brand”.

In a press release of 2017 the Italian Competition Authority has required the addressees the use of the following warnings to be placed below the post together with the others hashtags (#), such as “#sponsored, #advertising, #paidad”, or, in the case of products given for free to the celebrity, “#productsuppliedby”; in particular, all these wordings should be followed by the name of the specific brand being advertised.

However, browsing the Instagram’s pages of various Influencers, it is noticeable that only a few of them are actually using the indications provided by the authorities.

And when it happens to came across Instagram’s profiles that use such indications, it is noticeable that the hashtag that is most commonly used is “#ad”, whose effectiveness (especially in Italy where terms such as “advertising”, “Adv” and, even more so, “ad” are not easily decipherable by the average consumer) raises many concerns.

So far the Italian Competition Authority intervened sending moral suasion letters to some of the main influencers and companies producing the branded goods displayed in the posts, but still no self-regulatory, administrative or state measures have been taken.

The same situation of uncertainty is likely to be found in other countries (here you can find a previous Legalmondo post on this topic in Germany: https://www.legalmondo.com/2017/11/germany-product-placement-influencer-marketing/), with the consequence that international companies are operating in an unclear context, in which it is difficult to identify what are the risks arising from behaviours considered as unlawful.

I have therefore decided to write this article in order to assess the state of Influencer Marketing in Italy and in other countries and get a better understanding of the regulations in force, the measures/judgments issued by the competent Authorities, the international trends and the best practices that could be adopted by international companies.

Since I am one of the founders of the Digital Adv Lab – an interdisciplinary observatory that studies the legal implications of marketing and digital communication initiatives – I am interested in getting in touch with all the readers involved in this topic: please feel free to enter a comment and/or contact me.

The author of this post is Elena Carpani.

The application of the General Data Protection Regulation (“GDPR”), in force since 25 May 2018, will oblige companies to deal with issues concerning IT security and liability for collection and storage of personal data, without the possibility of any further hesitation. Privacy protection will become an important part of corporate culture and will have to be necessarily managed from the top levels, i.e. the managing director as well as the management team. Employees will also be involved in this awareness process through adequate training on such matter. Companies should set forth order and priorities of some data-related procedures, in accordance with privacy by design and privacy by default principles. In other words, such companies should ensure data protection from the onset of the product phase or service ideation and design, opting for behaviors that are aimed to prevent possible issues affecting personal data.

An even wider definition of personal data

The concept of “personal data” refers to all the information that identifies or makes a person identifiable and provides details related to his/her features, habits, life-style, personal relationships, health and economic conditions. Also, the definition of “personal data” becomes even wider and more well-structured when considering electronic communications with new technologies including geolocation bearing significant weight.

This transition, certainly problematic, introduces new challenges and opportunities, and highlights the question of data protection as a fundamental human right at the center of the international debate and digital policies. This results in a significant turning point. In fact, digitalization has caused several information security issues, which until a few years ago could be handled by national authorities in each single EU country, and now require a more focused and structured legal framework. The induction of platforms such as SaaS (Software as a Service) and the cloud computing growth have completely changed the scenario.

Therefore, the European Data Protection Supervisor (EDPS) positively dealt with the request to reform the legal framework on personal data protection in 2011, since the existing legislation was no longer appropriate.

Even though it is way too early to predict the impact of such privacy regulation, we believe that it is interesting to focus on certain general considerations and some of the GDPR’s outcomes in the international scenario.

The potential applicability of the GDPR worldwide

Certainly, one of the important changes brought about by the GDPR is its potential applicability worldwide: the regulation thus overcomes European borders in the name of personal data protection.

Such regulation, in fact, not only applies to all cases where data are handled by EU based companies, but in all cases where a company, even though not EU based, also deals with EU based individuals’ personal data, within the scope to offer them goods or services or to monitor their behavior in the EU.

Consequently, in the light of the above, all foreign companies still pursuing to offer and provide their services to EU-citizens cannot avoid complying with the GDPR.

Furthermore, even UK organizations may be forced to comply with the regulation to protect UK citizens’ personal data and maintain their competitiveness in the EU market, for reasons of opportunity and convenience, apart from compulsoriness as above described and, in any case, for as long as Brexit does not materialize.

The lack of connection with the data location

The regulation not only limits foreign companies that deal with EU citizens’ personal data, but also aims to govern all the processing of personal data, irrespective of the place where such data are located. It therefore provides that all the personal data processing made by EU based companies will be subject to the GDPR, regardless of the fact whether such processing is carried out within or outside the EU.

From a legal point of view, such data will be in the spotlight and subjected to this new regulation rather than to national laws. This means that the physical position loses relevance before the aim to grant interested individuals with a greater control on the information that is collected, processed and used by third parties.

For sure companies may stop their business with EU citizens in order to avoid compliance with the GDPR principles, but such choice should be correctly made: i.e. the GDPR’s application should be taken into account when a company provides a web service which is available also to EU citizens.

The disposition of strict fines

The fines for companies that are not in compliance with such regulation can amount to up to 4% of their global revenue and up to Euro 20 million. The relevance of such measures drew attention of all the parties, particularly in the US where organizations have a strong presence in the EU. Furthermore, the GDPR applies to organizations of any dimension and to both individual enterprises as well as large companies.

The forward-looking companies started to set forth their compliance programs immediately after the EU regulation announcement, but this appears complex and as a result meeting the set deadline called for 25 May could be difficult.

According to PwC’s reports, 9% of US companies declare to have allocated more than 10 million dollars with the aim to obtain such compliance.

Some compliance requirements for companies

Accountability principle: data processing needs to be carried out by recorded procedures, regardless of the fact that such procedures will be managed by the companies or by third parties on their behalf. Doing so will make the data controller responsible and oblige him to be compliant with the GDPR.
Risk based approach: the driving force of such a regulation is the aim to make companies responsible, which are therefore asked to comply with the GDPR principles by adopting a new risk based approach and risks assessment.
Clear and concise consent: much attention is paid to the consent of personal data processing, which should be clear, concise, distinguishable and unequivocal.
Data protection by design and by default: privacy management and implementation executed by means of default settings since the design phase; it means that companies should take into account the personal data protection, from the beginning a product, service or app is designed and developed.
Right to be forgotten: individuals are entitled to obtain, without delay, that their data is deleted by the data controller when certain conditions- provided by the GDPR -are met, such as for example when data become redundant and no longer necessary, or regarding the aims for which data have been collected or in the event when the individual’s consent is withdrawn.
Right to data portability: individuals are entitled to receive their personal data in a frequently-used, well-structured and machine-readable format, so as to transfer such data to another data controller, excluding any possible encumbrance by the former data controller.
Appointment of an EU Representative: the Representative should act on behalf of the data controller or the data processor and may be questioned by any surveillance Authority.

How to make the transition process easier?

The EU regulation relating to personal data protection requires a strong legal formation and, at the same time, tremendous technical implementation skills on the basis of the ongoing digitalization processes and use of even more innovative and complex technologies.

In such regard, companies may rely on professionals who are able to provide multidisciplinary services and consultancy, not only of a legal and IT nature, but who can exchange and implement synergies between professionals and business workers such as engineers and mathematicians.

Consequently, this burdensome commitment to follow the GDPR together with the obligation to comply with the law shall also enable companies to combine the aforesaid skills and join forces to commence a transition process that will ensure and ultimately result in growth.

The author of this post is Giorgio Piccolotto

According to Italian Copyright Law and to different European countries legislations, advertising creations and campaigns are not protected by copyright.

Articles 1 and 2 of the Italian Copyright Law list many copyrighted works but do not include advertising claims and creations, even through a broad legal interpretation.

The Italian Advertising Self-Regulatory Code (Codice di Autodisciplina della Comunicazione Commerciale, hereinafter the “Code”) and the Italian Self-Regulatory Jury (hereinafter, the “Jury”) should overcome such legal gap.

Article 13 of the Code provides the following:

“Art. 13 – Imitation, Confusion and Exploitation

Marketing communication should not copy or slavishly imitate that of others even if it concerns non-competitive products, especially if there is the risk of generating confusion with the marketing communication of others.

Moreover, any exploitation of the name, trademark, notoriety and corporate image of other marketers should be avoided, if it is intended to generate an undue advantage.”

According to the Jury case law, which often applied art. 13 of the Code, it is clear that there are two requirements for and advertising in order to obtain a legal protection: novelty and originality.

It is new an idea which has never been used or it is not in the consumers’ memory.

It is original an idea which consists in a significant creative effort.

Advertising campaigns that use stereotypes are not original, thus they are not protected by law: e.g. the idea consisting in a side-by-side comparison of two dishes in order to show a detergent effectiveness.

Another principle consists in the balance between originality and protection against imitation: the more an advertising is original (id est, it is not descriptive of the advertised product), the more it is protected against similar advertisings.

Art. 13 of the Code protects both the “heart” (the idea) of an advertising campaign and the form: so, if an advertising has a different heart and an identical claim or form compared to a previous one, it infringes art. 13 of the Code.

The Jury case law stated over the years a fundamental principle: when there is an identical copy of an idea or a claim of a third party (particularly if by a competitor), the originality degree required by the first advertising in order to obtain a legal protection is almost null.

Even simple and ordinary ideas can be protected under art. 13 of the Code if they are slavishly imitated, particularly by a competitor which sells product of the same category.

The Jury, in its decision n. 5/2018, seems to have changed its orientation on the matter, especially concerning the requirements of novelty and relevant imitation.

The decision concerned two competitors in the fruit and vegetable sectors: La Linea Verde (owner of the trademark “Dimmidisì” (say yes to me) and manufacturer of product labelled by such mark) and Del Monte.

La Linea Verde started to use the claim “Tutti dicono di sì” (all say yes) at the beginning of 2017 in various online and paper campaigns and in a trade fair.

After a few months (October 2017) Del Monte started to use the claim “Tutti dicono sì” (all say yes – with a slightly different wording) in its advertising campaigns.

Thus, La Linea Verde sent to Del Monte a cease and desist letter and later filed a complaint before the Jury claiming the infringement of art. 13 of the Code.

In the decision, the Jury:

after stating that the claims “Tutti dicono di sì” e “Tutti dicono sì” are identical, both by the form (the word “di” is not relevant) and by the content, because both the claims suggest adhesion to the products by the consumer;
after stating that La Linea Verde has a prior use of the claim and stating that the publishing of the claim on the web and on a trade fair, even if not reported on an advertising search engine (like Easy Way), are appropriate in order to prove the prior use of a claim;

after stating that the claim has never been used in that market and in different markets in the past decade;

the Jury eventually stated that Del Monte slogan has to be considered “a logical development of an advertising idea that Del Monte, undeniably, has been proposed for a long time”, referring to the ’80s and ’90s popular advertising “L’uomo Del Monte ha detto sì” and to the less popular “Sì al meglio, sì a Del Monte”.

The Jury stated that, even if there is a formal overlapping between the claims, the advertisings have their own aspects and they cannot be overlapped in the consumer’s perception (and, in my opinion, this is contradictory, because the Jury previously recognized in the same decision that the claims had the same meaning: suggesting the adhesion to the products by the consumer).

It seems this is a change of course by the Jury concerning claim imitation and likelihood of confusion (art. 13). The Jury stated that it is possible to use two identical (form and content) claims, both original, because there is “a logical development” between an expression (“Tutti dicono sì”) and a communicative path (“to say yes” by Del Monte).

It is a change of course that, in the future, may create some problems to creative directors and lawyers: it will not be sufficient to monitor if a claim has been already used by third parties, but it will be necessary to check if an advertising is “a logical development” of a different communication by a third party. This would result in a subjective judgment which affects the fundamental legal certainty principle.

The author of this post is Elena Carpani.

The fourth Industrial Revolution, currently experienced by global economy, displays a melting-pot of a wide range of new technologies combined one another, impacting on every aspect of economy, industry and society by progressively blurring the borders of the physical, digital and biological spheres.

The growth of robotics, of artificial and virtual intelligence, of connectivity among objects and of the latter with humans, is contributing to strengthening the virtual side of economy, made of its intangible assets. Even trade is tending more and more towards a trade of intellectual property rights rather than trade of physical objects.

In such a scenario, protection of intellectual property is becoming increasingly important: the value of innovation embedded in any product is likely to increase as compared to the value of the physical object itself. In other words, protection of intellectual property could significantly affect economic growth and trade and shall necessarily go forward as the economy becomes more and more virtual.

Future growth of the 4.0 economy depends on maintaining policies that, on one hand allow connectivity among millions of objects and, on the other, provide for strong patent protection mechanisms, thus, encouraging large and risky investments in technology innovation.

Are SMEs, which represent the beating heart of the Italian economy, ready for all this? Has Italy adopted any policy aimed at boosting innovation and the relevant protection for SMEs?

After more than four years since the launch of the Startup Act (Decree Law No 179 of 18 October 2012), Italian legislation confirms being among the most internationally advanced programs for innovative business support strategies. If we look at the Start Up Manifesto Policy Tracker Startup Manifesto Policy Tracker (a manifesto for entrepreneurship and innovation to power growth in the European Union), published in March 2016, Italy is in second place among the 28 EU Member States, in terms of the take up rate of recommendations made by the European Commission on the innovative entrepreneurship issue.

The Annual Report to Parliament on the implementation of legislation in support of innovative startups and SMEs (Edition 2016) confirms the results of the Startup Manifesto Policy Tracker: Italian ecosystem has grown in terms of number of startups recorded (+41% on the previous year), of human resources involved (+47,5%), of average value of production (+33%) and, finally, of funding raising (+128%, considering access to credit via the SME Guarantee Fund).

This growth is the outcome of both the inventiveness and the attention to innovation that have always characterized Italian entrepreneurs as well as of the progress made by Italian legislation over the past years: changes were introduced in order to boost the national system for business startups and, in some cases, to promote innovative entrepreneurship as a whole.

Adopted measures include, for example: the implementing Ministerial decrees on tax credits for R&D investments; the ITA Service Card for innovative SMEs, the multimedia, bilingual online platform #ItalyFrontiers (the aim of which is to promote capital investment and encourage open innovation projects involving innovative Italian businesses); Italia Startup Visa and Italia Startup Hub (the renewal, under the 2016 Decree on Immigration Flows, of a preferential procedure for the granting of visas and the conversion of permits to stay for self-employed for non-EU citizens wanting to move to Italy or remain there to start up an innovative enterprise); the launch of a new simplified online company incorporation procedure that enables innovative startups to be opened as limited liability companies, granting significant time and cost reductions; the extension (until 2016) and the reinforcement of fiscal incentives available for investment in innovative startups; finally, the extension of the free, simplified access to the Guarantee Fund to include innovative SMEs in order to make it easier for them to obtain credit.

The importance of Intellectual Property in the modern economy

A national policy that has a target of incentivizing the use of Intellectual Property is a policy that will have beneficial effects on the entire national (and international) economy.

Proof of this, are the results of the studies carried out by the European Observatory on Infringements of Intellectual Property Rights and the European Patent Office (EPO) on the contribution of intellectual property rights (IPR) on the EU economy.

The study analyzed the effects of intellectual property on the EU in terms of gross domestic production, occupation, wages and trade. Here are some of the most interesting data:

– 42% of the total economic activity in the EU (approximately EUR 5.7 trillion) and 38% of occupation (approximately 82 million workplaces) is attributable to IPR-intensive industries;

– IPR-intensive industries pay significantly higher wages than other industries, with a wage premium of 46%;

– IPR-intensive industries tend to be more resilient against the economic crisis;

– IPR-intensive industries account for about 90% of EU trade with the rest of the world, generating a trade surplus for the EU of EUR 96 billion;

– about 40% of large companies own IPRs.

The data gathered by this study should raise social and political awareness as to the importance of stimulating not only large companies, SMEs and startups in general, but also those, which use intellectual property.

The innovation criteria

An interesting measure that is showing good results in relation to the dissemination of IPR companies in Italy is the introduction, thanks to the Startup Act, of the concept of innovative startup.

The Startup Act provides facilitating measures (e.g.: incorporation and following statutory modifications by means of a standard model with digital signature, cuts to red tape and fees, flexible corporate management, extension of terms for covering losses, exemption from regulations on dummy companies, exemption from the duty to affix the compliance visa for compensation of VAT credit) applicable to companies which have, as well as other requirements, at least one of the following requirements:

– at least 15% of the company’s expenses can be attributed to R&D activities;

– at least 1/3 of the total workforce are PhD students, the holders of a PhD or researchers; or, alternatively, 2/3 of the total workforce must hold a Master’s degree;

– the enterprise is the holder, depositary or licensee of a registered patent (industrial property), or the owner and author of a registered software.

The Startup Act is still having positive effects on the startups demographic trends. As a matter of fact, during the first six months of 2016 there has been a growth rate of 15,5% in the number of registered companies.

The success of the Startup Act brought the Italian legislator to extend with the Investment Compact (Decree Law No 3 of 24 January 2015) most of the benefits provided for innovative startups also to innovative SMEs.

By the Investment Compact the Italian Government recognized that innovative startups and innovative SMEs represent two sequential stages of the same continuous and coherent growth path. In a context as the Italian one, dominated by SMEs, it is fundamental to strengthen this kind of enterprises.

The measures in question apply only to SMEs, as defined by the European Commission Recommendation 361/2003 (companies with less than 250 employees and with a total turnover that does not exceed € 43 million), which have, as well as other requirements, at least two of the following requirements:

– at least 3% of either the company’s expenses or its turnover (the largest value is considered) can be attributed to R&D activities;

– at least 1/5 of the total workforce are PhD students, PhD holders or researchers; alternatively, 1/3 of the total workforce must hold a Master’s degree;

– the enterprise is the holder, depositary or licensee of a registered patent (industrial property) or the owner of a program for original registered computers.

Unfortunately to this day the Investment Compact has not produced the expected results: on one hand, there is a problem connected to the not well-defined concept of “innovative SMEs”, differently from what happened with startups; on the other hand, there are structural shortcomings in the communication of government incentives: these communication issues are particularly significant if we consider that the policy on innovative SMEs is a series of self-selecting, non-automatic incentives.

Patent Box

Another important measure related to the IP exploitation is the Patent Box, the optional tax rule applicable to income derived from the exploitation of intellectual property rights.

The Patent Box rules were introduced by the 2015 Stability Act and give to businesses, from 2015 onwards, the option of tax-exempting up to 50% of the income derived from the commercial exploitation of software protected by copyright, industrial patents for inventions, utility models and complementary protection certificates, designs, models, company information and technical/industrial know-how, provided that they can be protected as secret information according to the Italian Code of Industrial Property: meaning patented intangibles or assets that have been registered and are awaiting a patent.

Originally, also the exploitation of trademarks allowed entrepreneurs to choose the Patent Box optional tax rule, but a very recent Decree erased that provision by excluding trademarks from the Patent Box regime. This exclusion has just been introduced in order to align the Italian Patent Box to the prescriptions of the Organization for Economy Co-operation and Development (OECD).

Said policy has a dual purpose: on one hand, it seeks to encourage Italian entrepreneurs to develop, protect and use intellectual property; on the other hand, it intends to make the Italian market more attractive for national and foreign long-term investment, while protecting the Italian tax base. The incentive encourages the placement, and preservation in Italy, of intangibles that are currently held abroad by Italian or foreign companies and also fosters investments in R&D.

The Patent Box is certainly of great importance for Italian economy and has relevant merits, but it can be further improved. During the convention held on the 8th of May 2017 in Milan entitled “Fiscal levers for business development: the patent box example”, organized by Indicam, the institute for fight against counterfeiting established by Centromarca, it was highlighted that one aspect to improve is that of the Patent Box’s appeal to SMEs: there is a need for this policy, which was thought mainly for large companies, to be really effective. One solution, proposed by the Vice-Minister of Finance and Economy Luigi Casero, guest of the convention, is to «introduce some statistical clusters, a kind of sector studies, an intervention of analysis and evaluation of the fiscal indicators of a specific type of company».

UPC

The last matter that deserves to be mentioned is that of the Unified Patent Court: Italy has ratified the United Patent Court Agreement on the 10th of February 2017.

As it is known, in order to start its operations the Unified Patent Court needs the ratification also of United Kingdom. Moreover, one of UPC central division should be located in London in addition to the ones in Paris, Munich. After Brexit this maintaining of the London Court appears inappropriate both under a juridical and an EU opportunistic point of view.

As provided for the UPC Convention a section of the central division should be in Italy because it is the fourth EU member state (after France, Germany and the UK) as to the number of validated European patents in its territory: the London Court should be therefore relocated to Milan.

Moreover Italy is one of the main countries in the EU applying for not only European patents but also trademarks and designs (and so contributes substantial fees) yet it does not host any European IP institutions.

An Italian section of the UPC would certainly bring a higher awareness, also of smaller enterprises, in relation to the importance of IP protection.

Conclusion

A disruptive and unprecedented transformation is taking place, involving industry, economy and society, with its main whose main driver being the relentless ascent of its intangible component.

What we have to do, as a society, is follow this transformation by changing our way of thinking and working, abandoning the old paradigms of the analogic era.

Policy measures as the Startup Act, the Investment Compact and the Patent Box are surely important initial steps that are bringing certain positive effects, but they are not enough and they have not yet achieved the maximum results.

As pointed out by the #StartupSurvey, the first national statistical survey of innovative startups, launched by the Italian National Institute of Statistics and the Ministry of Economic Development (the data were gathered by a mass mailing to all the innovative startups listed in the special section on 31 December 2015), the majority of Italian startups and SMEs (52,3%) have not adopted any formal mechanism, as the ownership of an industrial patent, to protect their innovation. Only 16,1% of the respondents owned a patent and only 11,8% owned a registered software.

Among the reasons that bring startups to not adopt protection mechanisms, the majority of the entrepreneurs (48,4%) claimed to be convinced that the innovation of their enterprise could not be taken away by third parties. On the other hand, a considerable number (25,5%) said that they were not aware of the necessary strategies.

The data gathered by the survey confirm that there is a communication and information issue, as noted in the paragraph above, to be solved.

An interesting initiative relating to this problem is the new questionnaire realized by the Head Office for the fight against counterfeiting of the Ministry of Economic Development. This new and free service has been conceived, in particular, for startups and SMEs, allowing them to carry out an online self-assessment in relation to intellectual property.

The aim of the questionnaire is to make the enterprises aware of their intellectual property range and to direct them towards the adoption of appropriate strategies for the valorization of their intangible assets.

The Italian legislator has enacted law 19.10.2017 n. 155 “Law. n. 155” or “the Reform”; through the said piece of legislation, the Italian government is entitled to adopt a series of legislative decrees (the decrees should be enacted very soon) aimed, on the one hand, at reforming substantially the Royal Decree n. 267/1942 “Bankruptcy Law”, on the other side, at amending accordingly the so called procedure of “over-indebtedness”.

It is interesting to note that art.1 of the Law n. 155 mandates that the Italian legislator, while adopting the said decrees, takes into account the EU regulation 2015/848, EU Commission recommendation n. 2014/135/EU and, most importantly, the UNCITRAL principles and guidelines.

Art. 2 sets forth some fundamental principles that as well must be followed by the Italian legislator.

First of all, the term “bankruptcy” i.e. Fallimento shall be replaced by the notion of judicial liquidation, in this respect, the criminal rules regarding bankruptcy shall be amended consequently. The so called ex officio (i.e. on Court’s initiative) bankruptcy declaration as provided by article 3 of Legislative decree n. 270/1999 (the law governing the so-called extraordinary administration) shall be repealed. The notion of state of crisis (a relative new notion) shall be properly defined as probable insolvency in the future. The definition shall be shaped taking into account the scientific development in the field of the business and administration science. Nonetheless, the definition of insolvency encompassed at art. 5 of Bankruptcy law shall remain the same.

Art. 2 further dictates that in order to ascertain the debtor’s state of crisis or insolvency a unique model procedure shall be adopted pursuant to article 15 of the Bankruptcy Law. The procedure shall be characterized by speediness, even in the ensuing phase of opposition. Legal standing in order to file a petition for bankruptcy shall be bestowed upon the supervising bodies of the business entity and upon the public prosecutor. The latter shall have the right to file a petition whenever he is aware of a state of crisis affecting the business entity.

The proceedings aimed at ascertaining the state of crisis and or insolvency shall concern every category of debtor. Therefore legal entities and individuals alike shall be subject to the procedure that shall regards: commercial business entities, agribusinesses, artisans, entrepreneurs, consumers, professionals, collective entities with the exception of public entities.

Moreover, the Reform shall adopt the notion of center of main interests (“COMI”) as developed within the framework of EU law and case law.

Preeminence and priority shall be given to the restructuring proceedings whereby the ongoing concern of the business is safeguarded in view of the creditors’ satisfaction. In this latter case, the convenience of the rescue plan needs to be properly illustrated. Liquidation, by contrast, is reserved to those cases where no viable alternative is possible. Abuses in any event should be prevented.

Art. 2 also specifies that the Italian Legislator has to coordinate the new rules with the provisions governing the automated process and those regarding the service process to the certified electronic e-mail couriers which shall be applicable to professionals as well.

One of the main goals of the Reform is to reduce the time and the costs associated to the activities to be performed in the proceedings. In particular, the fees of the professionals involved in the proceedings should be kept under control in order to increment the amount of money to be distributed in favor of the creditors.

Another objective of the Reform is to reframe those provisos whose interpretation has generated a contrast amongst the professionals, the scholars and the courts, in order to favor a construction of the rules consistent with the principles and the purposes established by the Reform.

Likewise, for sake of uniformity and consistency, the Reform backs a process of high-level specialization amongst Courts and professionals involved in the procedures. In order to achieve those goals the Reform moves into different directions.

In this respect, the Courts specialized in enterprise matters shall have jurisdiction over the proceedings and all the deriving litigations regarding enterprises subject to the Extraordinary Administration and large group of companies. On the other hand, the competence for the proceedings regarding the consumers, professionals and minor entrepreneurs shall remain unaltered while for the other procedures shall be competent those Courts that shall meet certain requirements in terms of: (i) the number of professional judges involved in the bankruptcy field; (ii) the number of proceedings that have been dealt with in the last five years; (iii) the number of proceedings that have been completed in the last five years; (iv) the average duration of the proceedings during the last five years; (v) the ratio between the requirements above mentioned and the national average; (vi) the number of business entities registered within the competent records together (vii) with the number of the resident population within the relevant territory of the Court.

Moreover, a list of professionals having the requisites of competence, independence and experience o be appointed as administrator, receivers or commissioners shall be kept by the Ministry of Justice.

Last but not least, the insolvency proceedings shall be harmonized with The European Social Charter for the protection of the employment.

Convertible notes, SAFE Agreements, participative financial instruments: the growing interest in start-up investing has led to a progressive differentiation both in investment strategies and, as a consequence, in legal/contractual instruments so to best suit the investors’ needs.

The introduction of these tools, specific to foreign ecosystems such as the Silicon Valley, and the difficulties in sourcing sufficient capitals to back the development of start-up companies, in particular with regard to the early/seed stage, has encouraged several players to opt for instruments alternative to equity investment, either developed “nationally” or under common law systems.

This mind-set has many positive side effects since it opened up the capital raising landscape that now includes venture capital funds, business angels networks, family offices and even club deals composed of small investors willing to buy into start-ups (mostly over the incubation/acceleration stage) with an injection of capital for a relatively small amount of shares.

In Italy, this trend towards non-equity or demi-equity instruments had two major results: it contributed to dust off legal instruments first introduced by the latest comprehensive reform of the Italian company law in 2004 (e.g. participative financial instruments – in Italian: Strumenti Finanziari di Partecipazione or SFP – art. 2346, par. 6 of the Italian Civil Code); and it fostered the creation of new contractual models plainly inspired by well-known instruments used in the Silicon Valley. That is the case of Convertible Notes and SAFE Agreements (Simple Agreement for Future Equity).

These instruments, together with the SFPs, have a trait in common: they all require a cash investment which is meant to be converted to equity at a specific milestone or on a pre-set date. On the other hand, none of them entails the possibility for an investor to hold a participation as a shareholder (at least not straightaway). Investors become stakeholders instead and they may hold as many administrative/patrimonial rights as they manage to negotiate with the company or with the founders themselves as well as depending on the specific contractual instrument they selected. It is important to point out that profits distribution rights are not included among those subject to negotiation since innovative start-ups (namely early-stage companies that meet certain criteria set by the law: i.e. high level technology of the company’s scope, R&D expenditure or number of graduates employed, etc.) are prevented from distributing profits for the first five years according the pertaining Italian regulation (see art. 25, par. 2 of the D.L. 179/2012).

Convertible Note and SFP

Starting off with convertible notes: these instruments are extremely flexible and mainly used by club deals and family offices. They are structured as a hybrid between convertible obligations and traditional loans. Investors in facts lend money to a start-up on a specific interest rate and according to a contract where the parties have previously set out terms and conditions that would preside over their relationship. The investment is classified as a liability of the company to third parties and, more specifically, as a long term liability.

The parties set two different dates, one for the conversion of the credit to equity and another one for the possible payback (in case the conversion has not been exercised). Sometimes the parties decide to leave the payback aside and set directly the date of the conversion to equity thus transforming the instrument from a demi-loan to an option on a prospective capital increase, where the money invested in the company would be considered as the price of the option; or even an obligation that can be converted to shares, an hypothesis admitted by eminent scholars not only for corporations, but also for limited liability companies.

The conversion date is usually set before the reimbursements, for the latter is meant as the last resort in the event the capital increase has not been approved by the company and provided that the parties had previously agreed upon such possibility. Furthermore, the reimbursement might be considered as a consequence of certain events, in particular when there is a payback request for cause or when a party violates any of the representations and warranties set out in the contract. In order to avoid unpleasant surprises, it is “customary” to provide for a future capital increase specifically dedicated to the investor – as well as an obligation for the investor to convert his loan – directly in the contract. The parties are free to determine whether the conversion should take place on a certain date or subject to the company meeting specific milestones such as: turnover goals, the achievement of specific results both economically and with reference to the development of its tangible/intangible technological assets (for instance, the development of software or the patenting of an invention). The actual conversion may take place at once or in instalments through a resolution of the shareholders to schedule the capital increase in two or more tranches. The convertible note must provide for a price per share for the conversion based on the so-called pre-money valuation; it is quite usual to set also a conversion discount, that is a price per share lower than the per share price paid by other investors in that round.

SAFE Agreement

The SAFE Agreement – developed and used by the world-renowned California-based incubator “Y Combinator” – is neither a debt instrument, unlike convertible notes, nor an equity one since it does not give its holder the right to profit sharing or the right to vote as a shareholder. It is rather a financial instrument that incorporates a prospective right to buy out preferred shares.

Although SAFE Agreements do not have an Italian counterpart, SFPs may look alike when they are “designed” as semi-equity participative instrument (without payback) and used to collect capitals to be allocated in a specific equity reserve, which should be used only to cover the company’s operating losses and be considered otherwise unavailable. However, the extent of this unavailability is still a matter of debate among scholars and the possibility for the parties to a SFP agreement to determine that the reserve at issue might only be used upon depletion of the others (legal reserve fund included) is not undisputed as well. In one of the latest ruling on the matter, the judge has indeed opted for the availability of the reserve created upon issuance of the SFPs on account of its statutory nature, stating that it can therefore be depleted before legal reserve fund and equity (Court of Naples, 25/2/2016). This is basically the main reason why SAFE agreements cannot be implemented tout court in Italy.

In any case, the Italian Civil Code allows the possibility to design the SFPs so as to meet specific requirements since they are essentially “empty boxes” that can be filled by the parties based on the needs of either the issuing start-up company and/or the investors willing to fund it. In fact, the law only sets two guidelines: i) it excludes that the SFP could grant its holder the right to vote as a shareholder; ii) it establishes that these instruments can be endowed with patrimonial or even administrative rights. The possibility for a company to issue SFPs must be specified in the articles of association/bylaws, which refers to a future extraordinary meeting of the shareholders for the adoption of the pertaining regulation, which will also set out the functioning rules of the special assembly dedicated to the holders of SFPs.

Turning to the SAFE Agreement, the American model sets a conversion price that cannot exceed a certain cap, according to which the company assigns shares on a capital increase (i.e. SAFE preferred) with privileged rights and with restrictions closely similar to those typical of standard “preferred shares”. Furthermore, it also sets a discounted conversation price which, in the US experience, is in the range of 15-20%, while there no provision as to a future deadline for paying the investment back.

Nothing prohibits to adapt the regulation of the SFPs to the best practice resulted from the implementation of the SAFE Agreement in the US. That is the case of the “acceleration” clauses that allow the investor to convert its investment before the original date set out in the agreement in case of equity-financing/liquidity events, namely the acquisition of the start-up or a capital increase that brings new investors in. This type of clauses is also often used in convertible notes. Some clauses, on the contrary, cannot be transferred into a SFP. That is the case of the clauses that regard the payback in relation to dissolution events such as: (i) the voluntary suspension of the business activity of the company; (ii) the transfer of the company’s assets to benefit the creditors or (iii) the company’s winding-up process both voluntary and not. According to Italian law, the winding-up due to a total loss of equity implies the possibility to use the reserve destined to SFPs with the consequent loss of the money invested by the SFP holders. Hence the common practice – still debated among scholars – that sees the possibility to use the reserves created upon issuance of the SFPs subordinated to the complete depletion of the other reserves, legal reserve fund included.

Eventually, these practices have taken hold over the last few years since they are meant to provide the investors with more and more flexibility when dealing with financial/investment instruments as those described above. They represent in fact an opportunity for both start-ups, that can obtain capital on the short period, and investors, who can grade their entrepreneurial risk allocating their investment as a debt or not – depending on the chosen instruments – with a view to a conversion to equity that will eventually depend on several factors, not least the company’s business metrics and economical standing.

In conclusion, the dynamism of this sector and the recent intervention of the Italian legislator show that there is plenty of room for growth in the Italian start-up ecosystem.

The author of this post is Milena Prisco.

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The relationship between influencers and advertising is one of the most interesting topic of the recent years, and one to which many operators in the sector are devoting energy and money.

In this article we will return to talk about the legal problems that influencer marketing makes it necessary to analyze.

Please, allow me a note.

What arises from this brief examination is that this phenomenon is particularly interesting and widespread throughout the world.

The author of this post is Elena Carpani.

the value and other specific features of the trade secrets;
the measures implemented by the legal holder to protect the trade secrets;
the actions carried out by the infringer to acquire, use or disclose the trade secrets;
the impact of the unlawful use or disclosure of the trade secrets;
the parties’ legitimate interest, and how this may be affected by the endorsement or rejection of the judge’s measures;
the legitimate interest of third parties;
the interests of the general public; and
the need to ensure protection of the fundamental rights.

A statute of limitations has been established in 5 (five) years for rights and actions connected with such misconducts.

“Influencer Marketing” is a very well known topic to the jurists and operators of the advertising sector dealing with commercial communication.

There is a core principle in communication law: any form of commercial communication shall be clearly recognizable as such.

For a short period of time there was a debate regarding the so-called subliminal advertising, which eventually fell into oblivion.

What measures should be taken to ensure that the consumers can understand clearly whether a post is subject of a contract or not?

The answer would be very simple.

It would be enough to require the sponsored post to contain, in clearly visible characters, terms as “Advertisement”, “Sponsored by”, “Commercial agreement” or similar notices.

However, browsing the Instagram’s pages of various Influencers, it is noticeable that only a few of them are actually using the indications provided by the authorities.

The author of this post is Elena Carpani.

An even wider definition of personal data

The potential applicability of the GDPR worldwide

Certainly, one of the important changes brought about by the GDPR is its potential applicability worldwide: the regulation thus overcomes European borders in the name of personal data protection.

Consequently, in the light of the above, all foreign companies still pursuing to offer and provide their services to EU-citizens cannot avoid complying with the GDPR.

The lack of connection with the data location

The disposition of strict fines

According to PwC’s reports, 9% of US companies declare to have allocated more than 10 million dollars with the aim to obtain such compliance.

Some compliance requirements for companies

Accountability principle: data processing needs to be carried out by recorded procedures, regardless of the fact that such procedures will be managed by the companies or by third parties on their behalf. Doing so will make the data controller responsible and oblige him to be compliant with the GDPR.
Risk based approach: the driving force of such a regulation is the aim to make companies responsible, which are therefore asked to comply with the GDPR principles by adopting a new risk based approach and risks assessment.
Clear and concise consent: much attention is paid to the consent of personal data processing, which should be clear, concise, distinguishable and unequivocal.
Data protection by design and by default: privacy management and implementation executed by means of default settings since the design phase; it means that companies should take into account the personal data protection, from the beginning a product, service or app is designed and developed.
Right to be forgotten: individuals are entitled to obtain, without delay, that their data is deleted by the data controller when certain conditions- provided by the GDPR -are met, such as for example when data become redundant and no longer necessary, or regarding the aims for which data have been collected or in the event when the individual’s consent is withdrawn.
Right to data portability: individuals are entitled to receive their personal data in a frequently-used, well-structured and machine-readable format, so as to transfer such data to another data controller, excluding any possible encumbrance by the former data controller.
Appointment of an EU Representative: the Representative should act on behalf of the data controller or the data processor and may be questioned by any surveillance Authority.