A license of financial influencers is born in the Emirates

A new specialty has just been recognized in the United Arab Emirates. It concerns "Influencers", these financial influencers who will now be licensed to carry out their activities, as long as they are considered useful and serious by the competent local authorities.

FACTS

• The Securities and Commodities Authority (SCA), Securities and Raw Materials Authority in the United Arab Emirates, has just announced the creation of a new "Fincer" license.

• The latter should enable the supervision and regulation of digital financial content in the region, by establishing a clear governance framework.

• The licence applies to all persons:
  • offering investment analyses,
  • issuing financial recommendations,
  • promoting financial activities on products, activities (purchase, sale or possession of a financial product or virtual asset) or regulated entities in the United Arab Emirates.

• Digital media (including social media) are particularly affected, but traditional media will also be monitored.

• The SCA emphasizes its pioneering status and ambition to change regulation as quickly as the online content and financial recommendations sector.

ISSUES

• Framework a market Dubai has long attracted influencers and, despite a recent decline in attractiveness, the city remains a strong place for this type of activity. Financial issues are obviously particularly sensitive and there are many risks related to possible fraud or malfeasance. The United Arab Emirates is thus committed to fighting a significant potential risk on its territory.

• Ensuring consumer safety : This announcement by the Securities and Commodities Authority (SCA) comes shortly after the Fraud Enforcement (DGCCRF) punished a former reality TV candidate now based in Dubai for "deceptive business practices" related to trading. The same DGCCRF specified Moreover, as early as 2023, 60% of the influencers targeted by its surveys did not comply with advertising and consumer rights regulations. The promotion of online trading or betting services was also specifically mentioned as a problem.

PERSPECTIVE

• The international market for investment psychology and financial influencers on social networks is expanding. However, the absence of established rules poses an increasing risk, particularly for young people who are interested in such advice on digital channels.

• The example proposed today by the Securities and Commodities Authority (SCA) represents a possible adaptation of the institutions to the new practices, while in France the regulation was generally strengthened on the issue of influencers in 2023. At the time, a Law This would impose strict rules on influencers, including a ban on the promotion of certain financial products such as cryptoactives without prior authorisation.

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