In recent years, social media platforms have become a hotspot for influencers promoting various products and services. However, the rise of unregulated gambling advertisements on these platforms has raised concerns about the potential negative impact on vulnerable individuals, particularly the younger demographic. As a result, Brazil is taking steps to curb the endorsement of online gambling by social media influencers.
The Need for Regulation
The Communication Committee of Brazil’s Chamber of Deputies has approved a proposal that aims to restrict digital influencers from advertising unregulated gambling platforms. This decision comes in response to mounting concerns about the adverse effects of gambling promotions on social media. The fear is that these promotions can lead to significant financial losses, mental health issues, and even suicides.
Guidelines for Influencers
The approved bill, known as PL 3915/23, lays out explicit guidelines for influencers when it comes to promoting gambling-related content. Influencers will be required to ensure that their content does not endorse or promote unregulated gambling activities. This means that they must refrain from advertising unlicensed operators through videos, stories, or any other forms of online media.
Additionally, the bill mandates that influencers disclose the commercial nature of their content and provide information about the funding source for betting activities. They must also educate their audience about the negative consequences associated with gambling. To ensure compliance, influencers will be required to establish written contracts with gambling operators, outlining the nature of their advertising work.
Responsibilities of Social Media Platforms
The proposed legislation also places responsibilities on social media platforms to monitor and promptly remove content that violates the regulations. Platforms such as Twitch, YouTube, TikTok, and others will need to collaborate with authorities in enforcing these rules. They will be required to establish channels for receiving complaints and to respond promptly to cases of infringement.
Failure to comply with the regulations can result in penalties for both influencers and social media platforms. Influencers may face suspensions of up to six months, while social media companies could be fined up to 2% of their revenues for non-compliance.
The Path to Implementation
Although the bill has been approved by the Communication Committee, it still needs to undergo further scrutiny. The next phase involves the bill advancing to the Finance and Taxation Commission (CFT) and subsequently to the Constitution and Justice Commission (CCJ). Only after these stages of review and potential amendments will the bill reach a plenary vote.
If the bill successfully passes all the necessary stages of review, it could set a significant precedent in the regulation of content by digital influencers not only in Brazil but also worldwide. The aim is to protect social media users from potentially harmful advertising practices and promote responsible propagation of content.
Implications for the Gambling Industry
The introduction of stricter regulations on social media influencers could have significant implications for the gambling industry, particularly unregulated operators. With influencers prohibited from promoting unlicensed gambling platforms, operators may face a decline in exposure and potential customer acquisition. This could lead to a shift in consumer behavior towards regulated and licensed operators, ultimately benefiting the regulated gambling market.
Brazil’s Ongoing Efforts in Sports Betting Regulation
This move to regulate social media influencers endorsing online gambling comes in the midst of Brazil’s ongoing process of regulating sports betting. While sports betting was legalized in 2018, the country has yet to launch its regulated market. The bill containing Brazil’s sports betting regulations was recently approved by the Senate but is still pending final approval in the Chamber of Deputies.
It is worth noting that while the proposal focuses on regulating sports betting advertisements, it does not include provisions for iGaming. The exclusion of iGaming from the bill has sparked debate, with critics arguing that it may inadvertently benefit the black market. However, licensed sports betting operators in Brazil will be subject to a 12% tax on gross gaming revenue and must comply with rules on responsible gambling, advertising, and the protection of sports integrity.
Brazil’s decision to impose stricter regulations on social media influencers promoting online gambling reflects a growing recognition of the potential harm that unregulated gambling advertisements can cause. By placing responsibilities on influencers and social media platforms, the aim is to protect vulnerable individuals, particularly the younger demographic, from the negative consequences of gambling promotions. As the bill progresses through the necessary stages of review, it has the potential to set a precedent for the regulation of content by digital influencers worldwide.