LONDON: As more Saudis connect through their social media profiles and even start profiting from these platforms, the Kingdom has launched a new licensing system to properly monitor the influencer industry.
Starting in early October, every Saudi and non-Saudi content creator in the Kingdom who earns revenue through social media advertising must first seek official permission from the General Audiovisual Media Commission (GCAM).
For a fee of SR15,000 (approximately $4,000), content creators will receive a three-year license, during which time they can work with as many private entities as they wish and promote only any product or service, as long as it does not violate Kingdom laws or values.
The inbound influencer license “is not a license to censor or block,” Esra Assery, CEO of GCAM, told Arab News. “It’s more of a permit to allow the industry to mature. We want to help these people grow, but grow professionally so that they can make a career out of (social media income).
The new regulations are being touted as legal protections, both for influencers and companies wishing to advertise with them, so that pricing and contractual obligations are standardized across the industry.
“The market is so unregulated,” Assery said. “We are not against influencers or these individuals. In fact, we want to activate them. If you check out the new policy, it also protects them, because the policy regulates their relationship with advertisers.
Currently, anyone in Saudi Arabia is able to advertise on social media and earn money through deals with private entities, with payouts per post reaching thousands of riyals, depending on the number of followers an influencer can reach.
Concerns have been raised that the introduction of permits and regulations would jeopardize the amount of money influencers can earn and could even amount to censorship. However, GCAM insists that the permits are designed to provide transparency between influencers and their customers.
Saudi influencers, whether based in the Kingdom or abroad, must apply for the permit if they wish to work with a brand – local or international. However, non-Saudi residents in the country must follow a different route.
After applying to the Ministry of Investment for a permit to work in the country, they can then apply for an influence permit through GCAM. However, non-Saudi residents must be represented by specific advertising agencies.
“While some influencers may focus on losing licensing fees in the short term, licensing has a huge upside as it legitimizes the industry domestically,” said Jamal Al-Mawed, Founder and Director. General of Gambit Communications. , said Arab News.
“This is crucial in the influencer industry as it has been a bit of a wild west for marketing in the past with no clear benchmark for rates or contracts.”
Al-Mawed said the new measures can protect susceptible brands from fraud “when they pay huge budgets to influencers who buy fake followers and fake engagements.” This creates a vicious cycle, as hard-working content creators are plagued by bad apples.
Although the new license is unlikely to solve all the problems overnight, “it creates a basis for more professionalism and accountability”, Al-Mawed added.
In June, non-Saudi residents and visitors to the Kingdom were banned from posting ads on social media without a license. Those who ignore the ruling risk a five-year prison term and fines of up to SR5 million.
GCAM announced the ban after finding “violations by numerous non-Saudi advertisers, residents and visitors, on social media platforms”.
“After verifying their data, it was found that they had committed systemic violations, including lack of business registrations and legal licenses, and that they are not working under any business entity or foreign investment license. “, said the commission at the time.
Now, with a regulated license, these violations will be easier to monitor and the industry will be better regulated to ensure full transparency.
Although Saudi influencers can hold full-time jobs while earning income through promotional campaigns on their social media profiles, the law states that non-Saudi people can only work in a specific role while residing in the country. Kingdom.
However, the system does not apply to businesses and entities – such as bakeries or hair salons – that hold social media accounts and advertise their own products or services on these platforms. Only individuals are affected by the new law.
There are, however, some exceptions, such as people who have been invited into the country by a ministry or government entity to perform, including musicians and artists.
With the rise of social media over the past decade, content creators and so-called influencers with thousands of followers on Instagram, TikTok, Snapchat and other platforms have driven audiences away from traditional media, such than television, newspapers and magazines, to new and largely unregulated media.
Sensing the shift in content consumption, advertisers followed the herd. Crystal clear waters lapping the white sand beaches of luxury hotels and scrumptious feasts at the finest restaurants are now commonplace on influencer profiles as businesses race to take advantage of more “natural” product placement.
However, regulators have struggled to keep up with this rapid transformation, leaving the process open to legal disputes, exploitation and abuse. This is why authorities elsewhere in the world have also explored influence permits.
Dubai, widely regarded as the influencer hub of the Middle East, is one of them.
In 2018, the UAE National Media Council launched a new electronic media regulatory system, which required social media influencers to obtain a license to operate in the country.
The annual license cost is AED 15,000 (about $4,000). Those who fail to obtain or renew the license face penalties, including a fine of up to AED 5,000, a verbal or official warning, or even the termination of their social media accounts.
The rules also apply to influencers visiting the UAE. They must either be licensed or registered with an NMC-registered influencer agency to operate in the country.
As Saudi Arabia moves forward in the entertainment and creative industries, the introduction of licensing is seen as a step in the right direction.
“This is great news for the industry,” Al-Mawed said. “When someone is authorized by the government to offer their services, it gives them a level of security and trust and can help filter out scammers who prefer to fly under the radar.”