On 8 September, Italy surrendered to the Allies. This began a race to disarm and intern the Italian garrisons of the Balkans before the Allies could take advantage of it. Lanz was tasked with overcoming the Italian forces in Epirus and the Ionian Islands. In two cases, in Cephalonia and Corfu, the Italians offered resistance. Lanz himself was initially in favour of negotiating the Italian surrender, but in the end followed his orders and stormed these islands. In Cephalonia, the battle raged for a week before the Italians surrendered. After their surrender, and according to a directive from Hitler, more than 5,000 Italians were executed by the Germans. Lanz was present in Cephalonia both during the battle and the subsequent massacre. In Corfu, resistance lasted only for a day, but all 280 Italian officers on the island were shot and their bodies were disposed of in the sea, on Lanz's orders.