Lawmakers in France ban social media influencers from promoting unlicensed crypto products and other risky financial services.
French lawmakers have taken a significant step towards protecting consumers by passing a new law that bans social media influencers from promoting unlicensed crypto products. The National Assembly’s Economics Committee voted in favor of the law that aims to curb the promotion of unsafe products and scams by well-known personalities on platforms like Instagram and YouTube.
Stéphane Vojetta, a member of Emmanuel Macron’s ruling Renaissance party, and socialist opposition member Arthur Delaporte, proposed the amendment. The legal change categorizes digital assets in the same group as risky financial products, gambling, and pharmaceuticals.
Under the proposed law, influencers in France cannot in any way promote crypto asset services from unlicensed providers. The ban also extends to regulated pharmaceutical products and substances, with the exception of cosmetic products and medical devices classified as I or II a. It will also include all surgical operations with an aesthetic aim or not. However, the relay of institutional health campaigns by persons carrying out the activity of commercial influence will not be affected by the ban.
The proposed ban aims to limiting the promotion of financial products and services that present a specific risk to consumers. This is in response to the excesses observed on social media platforms, particularly those relayed by the collectives of victims of influencers.
The new legislation updates the ban on commercial influence for remuneration for gambling, as well as for video games that include an essential functionality comparable to these games. Regulatory power can enact exceptions to these prohibitions to maintain a form of flexibility.
New Amendment Dissected
Violating these prohibitions will result in a penalty of two years’ imprisonment and a fine of 30,000 euros. A judge may also impose an additional penalty prohibiting the exercise of the activity of commercial influence.
The proposed development compared to the initial text is justified by the need to introduce penalties that respect the principle of proportionality. Lawmakers in France hope that this legislation will make social media crypto influencers more responsible and protect consumers from fraudulent practices.
The French government aims to tighten the promotion of crypto products, joining countries such as the U.K. and Belgium. This move follows the settlement between reality TV star Kim Kardashian and the U.S. Securities and Exchange Commission for hyping EthereumMax without disclosing someone paid her to do so.
The ban on online advertising in the context of commercial influence targets financial products and services that pose a specific risk to consumers. This is to counteract the excesses noted on social networks and relayed, in particular, by the collectives of victims of influencers.
The new legislation also updates the prohibition field to the current state of the law. It only allows the advertising of crypto assets for operators benefiting from an AMF approval. The ban includes offers to the public of tokens, within the meaning of article L. 552-3 of the monetary and financial code, except when the advertiser has obtained the visa provided for in article L. 552-4 of the same code.
The proposed amendment rewrites the provisions relating to the framework for the promotion of certain goods and services initially provided for in article 1 of the initial text of this proposal for law. The proposed wording covers four areas of health products, financial products and services, games of chance, money, and video games using identical mechanisms.
Implications
In a period marked by political problems, Delaporte told the committee it was time to “act to regulate a place where politicians have for too long been uninterested”. He added, “It’s not about killing liberty, it’s about valuing the work of influencers.”
French lawmakers believe that the new legislation is essential to protect consumers from fraudulent practices. The law would prevent social media influencers from promoting unlicensed crypto products, financial products, and services that can cause harm to consumers. The ban on influencer promotions is a key part of this legislation.
This ban is significant because it seeks to protect consumers from unsafe products and fraudulent practices. Social media influencers are often seen as trusted sources of information and have a significant impact on their followers. By banning the promotion of unlicensed crypto products by influencers, the French government hopes to prevent consumers from being misled or scammed.
The French government’s decision to ban influencer promotions of unlicensed crypto products is a welcome step towards protecting consumers. By cracking down on fraudulent practices and limiting the promotion of risky financial products, the French government is taking a proactive approach to consumer protection. The proposed penalties for violating the ban are also significant and will act as a deterrent for those who may promote unlicensed crypto products.
All in all, social media influencers who promote financial products will need to ensure that they promote licensed products and comply with the new regulations. Failure to comply could result in penalties and fines.