Regulation of Distribution of Social Advertising

Any person or company may advertise a manufacturer or seller of a product or service. Such persons are called distributors of advertising. An integral part of their activities is advertising. From April 2021, this applies to the Internet as well.

Advertisers are now required to enter into social advertising distribution agreements within 5% of their annual advertising volume. At the same time, social advertising distributed on the Internet must contain the mark "Social advertising", as well as an indication of the advertiser of social advertising and the site containing information about the advertiser of social ads.

A special operator - a non-profit organization that will be endowed with appropriate functions should monitor the implementation of the new requirement. The functions are the following:

• collect information about advertising volumes
• calculate the mandatory share of social advertising
• determine the available formats for the distribution of social advertising based on the methodology approved by the authorities
• ensure compliance of the advertisements proposed for distribution with general industry standards, as well as with the requirements of the Internet site
• post on the Internet an annual report on their activities.

Though the operator shall be imposed some restrictions. Thus, it is prohibited to transfer the received information to third parties, to use such information for purposes not provided for by the advertising law, and also to charge advertisers for the distribution of social advertising.

The first operator of social advertising will be appointed until 01.07.2021 and its term of office shall be 5 years.

Also, starting from July 01, 2021, additional requirements will be introduced in relation to advertising distributors with a daily Internet audience of more than 100 thousand users: 

• sending to the operator of social advertising information about the volumes, methods, forms and means of advertising distribution
• for the distribution of social advertising within 5% of the total volume of advertising free of charge. 

The novation will primarily affect such large Internet platforms as Yandex, Google and Mail.ru, but against this background, the prices for advertising distribution for ordinary advertisers may be increased. 

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