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This year, the United Arab Emirates has taken a significant leap forward in regulating online activity in the marketing arena.  A new Electronic Media Regulation (“EMR”) was introduced in early March by the National Media Council (“NMC”), the federal body responsible for overseeing media affairs in the UAE, As a result, since 1 June 2018, individuals and companies based in the UAE and carrying out ‘electronic media activities’ have required a licence for these pursuits. Following some uncertainty about the scope and application of the Regulations, the regulator held a workshop on the application of the new rules.  Following this workshop and ongoing discussions with NMC representatives,  we are now pleased to share details of several of the key features of the licensing regime, and to provide some guidance on  issues that those active in the online environment may wish to consider when planning or engaging in online marketing campaigns in the UAE.

When does it apply?

From a licensing perspective, the EMR only applies to entities that:

1. have a base (e.g. its main office, a subsidiary branch or a representative office) in the UAE; and
2. that base carries out the same activities as the main entity.

For example, if a streaming service has a subsidiary in the UAE, but that subsidiary only carries out market research for the content and has no involvement in the broadcasting/subscription aspect of the service, no licence would be required. Likewise, if an online sales platform has a subsidiary in the UAE that only handles delivery of the goods, it will also be exempt from the licensing requirements.

From a content perspective, however, the scope is far wider – in short, any content that is directed or available in the UAE will technically be within the NMC’s remit and is required to comply with the relevant standards.

What activities are covered?

The EMR deals with ‘electronic media activities’:

1. Websites used to trade, display and sell audio, visual and print material (e.g. online sales of music, films and books, including streaming services);
2. On-demand electronic publishing and printing (e.g.: online sales platforms that allow third party traders to advertise goods and/or services to consumers)
3. Specialised websites, e.g. “electronic advertisements”, news sites etc

The NMC also has wide discretion to expand this list with any activity it deems appropriate.  Carrying out these activities in the UAE requires a licence.

Why do people keep talking about influencers needing a licence?

The definition of “electronic advertisements” in the EMR as mentioned above covers “the presentation or promotion of ideas, goods or services by electronic means or applications, whether paid or unpaid”, and it is this section that catches influencers who use their social media accounts to commercially advertise a third party’s goods or services. ‘Commercially’ in this context, however, is not limited to paid-for activity. Influencers and bloggers who receive non-monetary benefits (e.g. free products or free entry) to promote a particular brand or event will therefore require a licence, and only those individuals and organisations that promote goods or services voluntarily (i.e. where there is no relationship between the brand and the influencer) will be exempt.

Notably, a company’s use of social media sites to promote their own goods or services would not be considered an ‘advertisement’ under the EMR and therefore would not require a licence.  

How are licences issued?

Applications for the licence are to be made via the NMC website (http://nmc.gov.ae/en-us/Services/Pages/New-Media-Licence.aspx). All applicants for an electronic media licence, including individuals (whether amateur or professional), are required to hold an appropriate trade licence with a UAE authority. Influencers have three options when applying for an electronic media licence:

1. Apply for an individual influencer licence;
2. Form a company and apply for a single ‘partnership licence’. All advertising agreements must be made with the company. ; or
3. Join a recognised influencer agency on an exclusive basis – in this scenario, the influencer would be covered by the agency’s licence and no separate electronic media licence is required.

The licence is valid for one year and must be renewed within 30 days of the existing licence expiring.  The renewal period can be up to a maximum of three years, provided the fees for each year are paid.

What else do I need to know?

The EMR follows the publication of a new Media Content Resolution (No. 26 of 2017) (“Media Standards”), which established wide-ranging criteria with which media content must comply, reinforcing the message that, at least in theory, digital content is subject to the same content requirements as traditional media in the UAE.

Licence holders are required to ensure that any media content published is in accordance with the Media Standards. Although loosely based on the Advertising Standards (Decision No. 35 of 2012), the principles have been significantly expanded to cover all types of media content (rather than just advertisements). In addition to the familiar requirements such as respecting the UAE’s religious, cultural and social values, as well as its regime and political institutions, notable examples include:

• Verifying news sources and ensuring they are properly attributed (including a specific prohibition on ‘fake news’ that would harm the economy, or ‘misleading’/’biased’ news and rumours which could create commotion);
• Refraining from using individuals in advertising without their consent, whether it is a photograph, caricature or simply a reference to them;
• Refraining from infringing the rights of institutions and individuals, either directly or indirectly;
• Not encouraging children to play in dangerous areas;  
• Not displaying content that might encourage gambling; and
• Clearly labelling advertising materials that are of a paid nature, although the method of doing so is not specifically addressed in the Media Standards.

The NMC has broad powers under the Media Standards to block and censor content which does not comply. The Media Standards also establish the formation of a committee, tasked with monitoring website content and submitting recommendations for those which should be blocked. Given the increased focus on digital activities, we recommend that brands who target this region take particular care when choosing their content and seek specialist local advice where necessary.

Who is responsible?

It is the responsibility of the owner of the account/website (i.e. not a third party) to obtain a licence for their electronic media activities. Nevertheless, brands will be responsible for confirming that the licence is in place before contracting with such parties and the NMC has issued a circular to all government departments and companies in the UAE, specifically reiterating that they should only work with influencers who have the appropriate media licence. As such, it is worth addressing this point specifically in any agreement entered into with an influencer, to provide a contractual form of redress in the event of a dispute.

What if it all goes wrong?

The EMR does not contain details of the penalties for non-compliance. However, at the recent NMC workshop, it was confirmed that those who fail to follow the new rules could face a fine and/or have their social media accounts and websites shut down.

It is also clear that the NMC will coordinate with any department necessary to give full effect to the EMR, such as working with the Dubai Economy and Ministry of Economy for breaches involving infringement of intellectual property rights and liaising with the Telecommunications Regulatory Authority to ensure that content is adequately blocked.  

Against this backdrop, it is notable that the stated aims of the EMR also hint towards increased scrutiny of content going forwards, and greater regulation of the digital media industry as whole. Such objectives indicate a step-change in the outlook of the NMC, which has historically taken a reactive approaching to digital content, and may serve as a timely reminder for agencies and brand owners to familiarise themselves with the new rules. 

UDPATE: The UAE National Media Council (“NMC”) published new guidance in relation to advertising standards in the UAE. In our article here, we discuss recommendations which constitute the most comprehensive guidance the NMC has given to date and serve as a practical indication of what they will be looking for to demonstrate compliance.