Tech & Sourcing @ Morgan Lewis

Financial regulators in the United Kingdom, European Union, and United States are proposing new rules to regulate how financial products are promoted on social media platforms. There is a particular focus on financial influencers, who are individuals or groups with large followings on social media that promote financial products or services, also known as "finfluencers.” Regulators are taking action against finfluencers promoting what they deem to be high-risk financial products, including cryptoassets, after a series of cases where financial products promoted online led to huge losses for consumers.

The European Union’s Digital Services Act (DSA) came into force on November 16, 2022. The DSA creates comprehensive new obligations for online platforms, introduces protections for users' rights online, and places digital platforms under a new transparency and accountability framework. The DSA is a first-of-a-kind regulatory toolbox globally, which sets an international benchmark for a regulatory approach to online intermediaries.

On November 18, days before the FIFA World Cup Qatar 2022 was due to start, Anheuser-Busch InBev (the owner of Budweiser, a World Cup sponsor since 1985) was dealt an unexpected yellow card: FIFA issued a statement that appeared to renege on certain terms of their $75 million (£63 million) commercial sponsorship agreement.

On May 6, 2022, the UK government outlined its plans to boost competition and drive economic growth and innovation in a major regulatory reform aimed at big tech. The news comes in the wake of fears that a handful of tech giants disproportionately dominate the market, subjecting smaller businesses to predatory prices and ultimately harming consumers through higher prices as well as limited options and control over their online experiences.

Following the success of the previous blog post “A Brief Overview of the Metaverse and the Legal Challenges It Will Present,” we are introducing a new feature for the Tech & Sourcing blog: “Future Watch.” Our Future Watch posts will focus on the most topical areas of the technology industry and will explore the associated legal challenges and potential future developments.

The European Commission confirmed on April 23, 2022, that the European Parliament and Council have reached political agreement the Digital Services Act (DSA) first published in December 2020. Morgan Lewis previously reported on the publication of the DSA.

As technology and the use of the internet continue to evolve, lawmakers remain focused on setting a legal framework for businesses operating “online” in Russia. In 2021, the Russian regulatory landscape underwent significant changes, which will no doubt have an impact on how tech and media companies conduct their business in Russia. Some key highlights include the following: 

Last week, we started to take a look at key issues sponsors should be mindful of when entering into a sponsorship agreement, particularly for sponsorship of a team, event, venue, individual influencer or player, or similar arrangements.

With many sports, music, and other events returning to in-person attendance after a prolonged hiatus for pandemic-related reasons, and others continuing to be conducted in front of huge virtual audiences, we think it’s a good time to run through some of the most common issues we encounter in sponsorship agreements.

Draft law “On Activities of Foreign Companies in the Internet in the Territory of the Russian Federation,” introduced to the State Duma, a lower chamber of the Russian parliament, on May 21, 2021, aims to extend Russian jurisdiction to certain non-Russian internet businesses by requiring them to open local offices in Russia and to comply with orders of Roskomnadzor, a Russian internet and data privacy regulator. Failure to do so may result in restrictive measures limiting ability to work with Russian users and businesses.