22 Nov 2018

A licence to influence – regulating Social Media in the UAE

Authored by: Victoria Woods

In brief:

  • There has been marked acceleration in recent years of internet usage across the GCC, and the UAE in particular, as well as increasing interest from global players in advertising and e-commerce expanding into the region.
  • As a result, the UAE’s National Media Council (NMC) has introduced significant new regulations and guidelines for the sector.
  • In this article we consider two recent developments in this area, specifically in relation to the regulation of social media in the UAE: the NMC advertising guide; and mandatory licensing.

The marked acceleration in recent years of internet usage across the GCC, and the UAE in particular, as well as increasing interest from global players in advertising and e-commerce expanding into the region, has seen the UAE’s National Media Council (NMC) introduce significant new regulations and guidelines for the sector. The purpose of these regulations and guidelines is to standardise electronic media activity which includes e-commerce, advertising and use of social media platforms in the UAE.

The new regulations and guidelines demonstrate the UAE’s recognition of the unique importance of new media to encourage growth both locally and internationally, whilst ensuring that the necessary mechanisms are in place for healthy development.  Their introduction demonstrates the NMC’s desire to keep abreast of the rapid developments in the electronic media space, to enrich digital content, reinforce religious, cultural and social values in the UAE, whilst respecting freedom of expression and making available balanced, responsible and impartial media content.

In this article we consider two recent developments in this area, specifically in relation to the regulation of social media in the UAE:

  1. The NMC advertising guide; and
  2. Mandatory licensing.

1. The NMC advertising guide

On 29 October 2018, the NMC published an official advertising guide which aims to clarify standards for content produced by advertisers in the UAE and protect the public from marketing promotions not conforming to the standards set by the NMC.

The guide refers to electronic advertisements in social media (including paid for content promoted by social media influencers) and reiterates that all those (both individuals and corporates) who carry out advertising activities on a commercial basis must adhere to these guidelines and ensure that they obtain a licence from the NMC before carrying out such activities, or else risk a fine of AED 5,000 for the failure to comply with advertising rules.

2. Mandatory Licensing

At the beginning of March 2018, the NMC issued its new regulation on electronic media activity in the UAE (including its free zones) (the Regulation) which aims to regulate electronic media and e-commerce, and other online activities such as advertising and the publishing and selling of print and audio-visual material. The Regulation also extends to advertising carried out via social media platforms.

a) What’s covered?

Under the Regulation, the following activities carried out in the UAE (including within the free zones) are required to be licensed by the NMC:

  • websites trading, offering and/or selling audio-visual and print material;
  • on-demand electronic publishing and printing;
  • specialised websites, including electronic advertisements, news sites, etc.; and
  • any electronic activity that the NMC deems appropriate to be added from time to time.

These activities being practised on social media on a commercial basis (i.e. in exchange for a fee) are subject to the licensing requirements under the Regulation.

b) Who can apply for a licence?

Both individual UAE citizens and corporate entities may apply for a licence under the Regulation. There are various criteria which applicants are required to satisfy in order to become licensed by the NMC.

In respect of individual applicants, examples of such criteria include (without limitation):

  • being of full legal capacity (although the age requirement may be exempted from time to time by the NMC);
  • having good reputation and conduct (i.e. not having committed any crimes involving breach of public honour or trust);
  • holding an appropriate academic qualification;
  • meeting the requirements of the relevant activity under the Regulation; and
  • not owing the NMC any outstanding financial sums.

In respect of corporate applicants, the company must be incorporated in the UAE and have not committed any regulatory violations in respect of any relevant authorities in the UAE. In addition, the regulated media activity must be one of the activities permitted by the company’s objectives. In other words, the company must be appropriately licensed to carry out the activities it seeks to promote via its electronic media activities.

Each website should have a responsible manager who is required to supervise the content of the relevant website, however, it is not yet clear whether this also applies to social media influencer’s accounts.

The websites of licensed traditional media such as newspapers, television, radio and magazines do not need to secure new licences under the Regulation. Websites of government entities, universities and schools are also exempted from the new rules.

c) What does this mean for social media influencers?

The Regulation requires each person carrying out media activities for commercial purposes using social media to obtain a licence in advance from the NMC. In respect of such licence, the following requirements should be met:

  1. there should be a recognised social media account;
  2. the advertisements posted on the social media account should meet the applicable advertising standards of the NMC; and
  3. the social media account holders who offer paid advertising services should obtain a licence from the NMC prior to carrying out such activities.

Licences for electronic or online accounts / websites, including specialised ones for advertising (such as a social media influencer’s account), attract a fee of AED 15,000 (payable in respect of new licences and for each renewal thereof).  It is also worth noting that the account holder is personally responsible for all content posted on the relevant social media account / page.

Any licence held under the Regulation is valid for one year and renewable for further one year periods thereafter. If no such renewal is applied for within 30 days from the expiry of the licence, the licence will terminate. Licensees can, however, renew their licences for a period of up to three years, provided that the relevant fees are paid in respect of each additional year.

Licensees have various obligations under the Regulation in relation to the content posted on their website/social media account, including respecting social values, observing public interest requirements and complying with principles and standards of media content under relevant UAE laws and regulations.

d) Penalties for failing to comply

Whilst the Regulation does not specifically reference penalties for non-compliance, NMC officials have warned that entities or individuals failing to comply with the requirements under the Regulation will be forced to pay a fine of AED 5,000 and/or have their accounts or websites shut down.

e) A step in the right direction?

For many, the Regulation is considered a positive step towards enhancing regulation and transparency over digital media and advertising. In particular, the new requirements move towards professionalising the rapidly growing industry of social media influencing and provide comfort to the public that those companies and individuals with a large public following are accountable for the media they publish online, noting that compliance with NMC standards is a mandatory requirement of obtaining and maintaining a licence.

For social media influencers, the Regulation could perhaps present a disincentive to what was previously a quick and unregulated way to earn money. Noting that not all posts by influencers are paid, some may have difficulty balancing the cost of the new licence fees against the upside to being an influencer.

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