CONAR publishes regulation on sports betting advertising

As a result of the new Sports Betting Law, the National Council for Self-Regulation of Advertising (“CONAR”) published Annex “X” of the Brazilian Code of Advertising Self-Regulation, which provides for the advertising of betting services.

As a rule, the new CONAR regulation states that betting advertisement must be socially responsible and not deviate from the essential purpose of showcasing and publicizing brands and details of these services. The new regulation bans messages that pressure individuals into betting or encourage exaggerated, excessive or reckless betting, either through text or image, direct or indirectly, including in slogans. Also, such advertisements must take extra precaution regarding the protection of children, particular attention to the need to be protected children, adolescents and other potentially vulnerable individuals.

In addition to introducing a chapter that provides for mandatory warnings regarding responsible betting, the new regulation is divided into the following principles:

• Clear identification of advertising
• Legitimacy and accuracy of information
• Protection of children and adolescents
• Social responsibility and responsible gambling

Below we have highlighted the main requirements and bans that apply to betting advertisers:

Main requirements

• Advertising content must be exclusively aimed at adults, i.e. children and adolescents cannot be participants or target audiences.
• Any advertisement publicized through a third party (influencer, affiliate, ambassador, partner or similar) must be clearly distinguishable from any associated editorial content. As such, the commercial advertisement nature of such content must be made clear for consumers.
• Social media ads can only run in pages, blogs, channels, profiles, or by influencers whose target audience does not involve children or adolescents.
• Social media profiles and websites of betting advertisers must, according to the applicable criteria of the platform used, be officially verified (through a seal or icon) as the owners of the service, or must include the “official profile” description, so that users are aware that these profiles and pages are the official communication channels of the brand.
• Advertising pieces must include identifiable authorization from the Ministry of Finance to be run in any type of media.
• Advertising must include a readable, clear and highlighted standardized warning such as “play responsibly” or “financial loss risk”.
• Individuals that participate in betting advertising must be and look older than 21 years old.
• Advertising featuring statements from well-known individuals must comply with the same provisions of Item 2, topics “a”, “b”, “c” and “d” of Annex “Q” – Testimonies, Affidavit and Indorsement.

Main bans

• Promising easy, ensured and high earnings and results.
• Stating, implying and leading consumers to believe that it is possible to control or predict game results.
• Implying that repeated use of the product will increase winning odds.
• Leading consumers to believe that betting can build wealth or serve as an investment or income alternative.
• Targeting children or adolescents as participants or audiences, which means that betting ads must not be run through any channel, program or media aimed at minors.
• Advertising betting services in merchandise such as clothing, equipment or products aimed specifically at children and adolescents.
• Using symbols, designs and other graphic, verbal or written elements aimed at children and adolescents.
• Offering credit or loans to consumers, such as providing bettors with advanced funds that must eventually be reimbursed and may result in consumers owing money to betting operators or third parties.

Only companies that are licensed by the Ministry of Finance can advertise betting services.

In this regard, companies must comply with the following requirements:

• Briefing advertising agencies and influencers regarding advertising methods and locations in terms of restricting the access of minors, pursuant to Item 4 of Annex X;
• Aligning the branding and content internally and with agencies to prevent any advertising from implying that betting is related to social, sexual, professional or financial success, among others provided for in Item 5 of Annex X;
• Carefully assessing the selection of influencers or celebrities that will take part in the advertising considering the age requirements (over 21), the target audience (adults) and compliance with CONAR’s advertising regulation.

As such, companies must draft tailormade for partnerships with advertising agencies and influencers, in compliance with Annex X. In addition, it is widely recommended that they annex brand guidelines to such contracts.

In addition, given the parties involved, consumer law regulations will apply, and the broad scope of the matter demands diligence from marketing and legal teams at companies within this industry.

We also highlight the offering of credit and loans, and its alignment with the “Super Indebtedness” Law, given that this matter has been monitored closely by the main competent authorities of consumer protection.

Demarest’s Public and Regulatory Law, Intellectual Property, Innovation and Technology, and Consumer and Retail teams are monitoring the updates of the industry and will remain available to provide any further clarifications that may be necessary.