With the evolution of technology, changes in how we live, in how we consume and interact, have come. Several services have seen their markets totally disrupted, and some others are on the verge of disruption. The audiovisual industry, including audiovisual content services, is among such disrupted markets. Advances in technology have completely changed how audiovisual content is delivered to the consumer and in turn has changed how consumers interact with their preferred content. These changes have come with the rise of several streaming services, which have been replacing the more “traditional” ways of delivering and consuming said content.
Local cable companies and traditional networks that used to rely on cable companies to distribute their content, have seen their market taken over by transnational companies which do not need to have physical infrastructure in their target markets in order to enter them. The result – a dramatic drop in revenues of these traditional companies, in some instances excluding them completely from the market.
With major changes come major challenges. Streaming services companies must pay attention to the new challenges brought with regulation applicable in the different jurisdictions in which their services are offered. Here we give a brief overview of the regulation applicable to companies delivering streaming services in Guatemala.
Under Guatemalan legislation a streaming service is not a “regulated activity”, which means that streaming companies do not have to seek permission to enter the streaming business in Guatemala, nor comply with special corporate requirements. However, companies need to observe general legislation that applies to their service.
In Guatemala, the streaming company will have a contractual relationship with the client, via what the Consumers Protection Act considers a Standard Form Contract (Contrato de Adhesión)[1]. Since the terms of the subscription cannot be negotiated, the streaming service providers will have to comply with the requirements set out by the Consumers Protection Act, relating to Standard Form contracts.
Given that streaming services are not a regulated activity in Guatemala, there is no specific agency overseeing the activity. Furthermore, there are no requirements relating to the type of content, content quotas nor specific content standards applicable to a streaming service. This also means that there are no fees or taxes levied by rendering streaming services, apart from the general taxes applied to every person obtaining Guatemalan-sourced income.
The Guatemalan Public Shows Act[2] provides rules for TV shows. Even when streaming services do not qualify within the definition of “TV show”, the Public Shows Act provides a guide for certain issues related with the services rendered by streaming services companies, such as a rating standard which is not mandatory, but it could be used as a guide by the companies.
While Guatemala does not have legislation regulating the kind of content that can be streamed, there are some considerations that a streaming company needs to observe when providing streaming services to and in Guatemala. For example, under Guatemalan law, it is a crime to insult or vilify the Guatemalan flag, the national emblem or the Guatemalan anthem. A streaming company needs to be aware, therefore, of such issues when creating content for steaming in or to Guatemala. Guatemalan law also prohibits the distribution of pornographic material involving child or underage persons. Both crimes are punishable with prison. Excluding the above outlined, there are no prohibitions related to language, sexual scenes, depiction of animals or gambling. There are also no prohibitions of depicting legal or illegal drugs. However, a company must be careful that their content is not “a promotion of” legal drugs - which would trigger administrative regulations - and that it is not “a promotion of” illegal drugs, which is a crime under Guatemalan legislation.
When making commercial references within content, creators need to observe relevant legislation in order to protect themselves and avoid misusing property of a third party. Guatemala does not have a special body of legislation addressing commercial references made through audiovisual content, however, it is important to observe several general rules that could come into play when making a commercial reference. For example, it is important not to refer to a product in a way that could constitute Unfair Competition as defined in the Guatemalan Commerce Code[3], or Misleading Advertising as defined by the Consumers Protection Act[4]. Companies also need to be aware that promoting tobacco or alcoholic beverages has some restrictions and carries the obligation of disclosing some health information. It is, therefore, advisable to depict such products in a way that cannot be interpreted as any form of product marketing.
It is fundamental to take into consideration intellectual property rights – of the company’s own IP rights as well as that of third parties – in the creation and the distribution of content. Under Guatemalan legislation, a streaming company offering streaming of music – the rights of which are owned by a third entity - will have to pay for the use of the music. As with many countries, in Guatemala there are associations of musicians and music producers that set out a fee schedule for the rights to use music of their affiliated musicians and producers. A streaming company needs to observe Guatemalan regulation relating more generally to intellectual property rights. Inappropriate use of names or trademarks is actionable even if it is not defamatory. Another consideration to take into account relates to moral intellectual property rights, since these do not expire and the person entitled to them cannot waive them.
Defamation crimes are also an area around which a streaming company needs to be careful. Such crimes are actionable by the offended party - according to Guatemalan legislation - or by a relative if the offence is directed to a deceased person.
Disclaimer: This content is intended to provide a general overview of considerations a streaming company should take into account when offering its product in the Guatemalan market. It is not intended to be a comprehensive summary of the applicable legislation nor a legal opinion.
- Consumers Protection Act, Decree 06-2003 issued by the Guatemalan Congress.
- Public Shows Act, Decree 574 issued by the Guatemalan Congress.
- Commerce Code Decree 2-70 issued by the Guatemalan Congress. Article 363.
- Article 20.