REASONED LEGAL OPINION ON WHETHER BOOKIERBEATER.COM CAN BE ADVERTISED WITHOUT A GAMING LICENSE.
- BACKGROUND
This is opinion is made with regards to the legality of advertising the products offered by bookiebeater.com on social media, where bookiebeater.com does not have a gambling license. The opinion also probes whether there can be any risks to FaceBook, which bookiebeater.com intends to rely on to advertise its products. Accordingly, the opinion has explained as clearly as possible, how relevant law applies to the aforementioned subject matter(s).
Bookiebeater.com offers sports blog services. Accordingly, members subscribe and are offered advice, and analysis on upcoming sports events. It is worth noting that the site does not offer any gambling services. Members thereof only get access to information, which they use at their discretion. Besides, other jurisdictions have permitted bookiebeater.com to operate in their territory without a gambling license. For instance, since November 2016, bookiebeater.com has been operating in Australia without a gambling license.
- LEGAL ANALYSIS
Is it legally allowed to advertise bookiebeater.com on social media without a gambling license, in the US?
Social media advertising is subject to several regulations and/or laws in the United States. However, the most relevant regulations and/or laws that apply to the subject matter herein is that of the Federal Trade Commission (hereinafter “FTC”); the Interstate Wire Act.
- The Federal Trade Commission
The FTC regulations focus mainly on the integrity of the communications in the advertisements. First, the FTC treats social media advertisements in the same manner as traditional media advertisements. This means companies that companies must evaluate their ads in social media the same way they evaluate ads placed on television, websites or other mediums. They must ensure they have a reasonable basis to support all objective claims made. According to the Federal Trade Commission Act, (1) the advertising must be truthful and non-deceptive; (2) the advertiser must have evidence to back up its claim and (3) the advertisement cannot be unfair.
Further, Section 5 of the FTC Act expressly prohibits “unfair or deceptive acts or practices in or affecting commerce. An advertisement is deceptive if it contains/omits any information that might mislead the consumer or that is important to the consumer’s decision to use the product. If disclosure of relevant information is required, this must be done in a way that consumers can see and understand. The FTC also provide that advertisers should not focus only on individual phrases or statements, but should consider the ad as a whole, including the text, product name, and depictions.
The FTC also came up with the Dotcom disclosures, which provides further regulations on online advertising in a web-based environment. In the disclosures, the FTC stated inter alia, that online advertisements are subjected to the same standards as advertisements in other traditional media; and that the disclosures in the adverts must be clear and conspicuous.
Importantly, the FTC does not list sports as one of the industries that need specialized regulation under the Act.
- The Interstate Wire Act
The Interstate Wire Act makes it illegal to place bets “using a wire communication facility.” Until recently, the Department of Justice interpreted that to include all wagers made online. Essentially, the Act made the transmission of bets and/or related information a crime.
It is worth noting that interstate transmissions of wire communications that do not relate to a ‘sporting event or contest’ fall outside the reach of the Wire Act.
It follows; the Interstate Wire Act prohibits any form of online sports betting. This means online sports betting companies won’t be licensed in the U.S. in the first place.
- CONCLUSION
Based on the foregoing analysis, my opinion is as follows:
- Bookiebeater.com solely provides information to its subscribers on upcoming sports events. Accordingly, pursuant to the FTC Act, bookiebeater.com should clearly and conspicuously clarify the nature of its products on its social media pages and on its website.
- The Interstate Wire Act does not allow any form of online sports gambling. Therefore, bookiebeater.com would not be licensed to operate in the United States in the first place. Since bookiebeater.com is not a betting/gaming website, it is free to advertise its services via any social media platform.
Therefore, bookiebeater.com does not require any license to advertise its products and/or services in any social media platform. Also, FaceBook is under no risk whatsoever (with regards to the licensing of bookiebeater.com) when it advertises bookiebeater.com’s services.
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