The Italian Competition Authority (“AGCM”) has issued a EUR 100,000 sanction against Zalando SE (“Zalando”) for an ambush marketing practice carried out during the 2020 European Football Championship (“UEFA Euro 2020”).
Specifically, on June 1, 2021, Zalando placed a large billboard in Rome in the square where the UEFA (the Union of European Football Associations) had set up an official commercial area dedicated to the UEFA Euro 2020 event, although Zalando was not an official sponsor of the event.
The billboard featured the question Who will be the winner? and the name Zalando and displayed the flags of the 24 nations participating in the event, as well as a white football jersey bearing the distinctive Zalando logo.
The billboard caught the eye of the financial police, which, on June 8, 2021, brought it to the attention of the AGCM; the AGCM then opened a proceeding to ascertain whether the use of the billboard—which was removed on June 8, 2021—could be regarded as ambush marketing, in breach of the provisions of Law Decree No. 16/2020, converted into law by Law No. 31/2020.
In the defensive briefs submitted to the AGCM during the proceeding, Zalando stated that it has always designed advertising campaigns to raise awareness of issues and topics of social importance. Taking this into account, according to Zalando’s defensive arguments, the goal of the billboard was to address issues such as social inclusion of minorities and rejection of any hostility amongst people and groups of individuals. Indeed, one week after Zalando placed that billboard, it was to be replaced with another one, which would repeat the question Who will be the winner? and then provide an answer: Love always wins.
In addition, Zalando contested the enforcement of Law Decree No. 16/2020 on ambush marketing by the AGCM, stating that events like the UEFA Euro 2020 could not be included in its scope. Furthermore, Zalando argued that the very short duration and minimal seriousness of its conduct should be taken into consideration.
According to the AGCM’s decision, which is the first to enforce Law Decree No. 16/2020, Zalando’s practice actually constitutes parasitic advertising activity and therefore is ambush marketing prohibited by Law Decree No. 16/2020, since the elements included in the billboard—which had not been authorized by the organizers of the UEFA Euro 2020 event—were likely to create a connection between the Zalando name and trademark and the UEFA Euro 2020 event, and therefore to mislead the public by suggesting that Zalando was an official sponsor of the event, which it was not.
Indeed, Law Decree No. 16/2020 includes among the prohibited conducts, also the creation of a connection (including an indirect connection) between (i) a trademark or other distinctive sign and (ii) an event which has the effect of “misleading the public as to the identity of the sponsors.” Moreover, the AGCM specified that the abovementioned law decree applies not only to “the organization and holding of the 2026 Milan-Cortina Winter Olympic and Paralympic Games and the 2021–2025 Turin ATP Finals”—as argued by Zalando—but to all sporting events of national or international importance and, therefore, to the international UEFA Euro 2020 event.
As a result, and based on Zalando’s 2020 revenues, the location and duration of the practice (the billboard was only in one square in Rome and only for one week), and the fact that this was the first time Law Decree No. 16/2020 was being enforced, the AGCM imposed on Zalando a sanction amounting to EUR 100,000, the minimum amount. AGCM may set sanctions anywhere in the range of EUR 100,000 to EUR 2,500,000 for breach of the law decree in question.