No More Misleading Ads: Centre Mandates Self-Declaration Certificate For Advertising Agencies
An advertisement is considered misleading when it misleads people from reality and influences their behaviour toward purchasing a product or service from the market. Recently, the Supreme Court took a step to stop misleading ads by advertising agencies. As per the Indian Medical Associations & Anr. Vs. Union of India & Ors. 2022, Advertising companies must provide a self-declaratory certificate to the competent authority before any content (Advertisement) is displayed, as per the Supreme Court's directive.
Now, advertising agencies and media have to file a self-advertising form to ensure that the content is not misleading in any way.
On June 3, 2024, the Ministry of Information and Broadcasting, in compliance with a Supreme Court directive, announced new regulations requiring a self-declaration certificate (SDC) to be submitted before the publication or broadcast of any content. This mandate, effective from June 18, 2024, stipulates that all advertising agencies must file their SDCs via the Broadcast Seva Portal managed by the Ministry. Meant for print and digital media, the SDCs are to be give in to through the Press Council of India's portal.
MISLEADING ADVERTISEMENT IN INDIA
Ads play a pivotal role in establishing a brand in the market. However, they become problematic when they contain false information and manipulate customers' emotions by providing misleading information about the brand. An evaluation done through the Advertising Standards Council of India in the year 2023-24 on 8,299 advertisements found that around 81% fell into the category of misleading advertisements, with 94% of the infringements identified through proactive monitoring.
Online platforms also play a crucial role in spreading misleading advertisements because a large population is connected to social media and consumes content through fake news articles or social media posts. Influencers and celebrities in India also spread misleading advertisements.
A survey conducted by the community media social media platform LocalCircles found that during the pandemic, an average of 70% of Indians encountered misleading advertisements through social media or various online sources. After watching these advertisements, they often purchase the products or services of the particular brand being advertised.
What is the Patanjali advertisement controversy: -
Patanjali claimed during the COVID-19 pandemic that its medicine “Coronil” was sufficient to cure COVID-19 and was certified and approved by the World Health Organization. However, later the WHO denied this claim and criticized it. Following this, while attacking the medical pharma industry, Patanjali made claims about several diseases, asserting that its medicines were sufficient, well-suited, and could cure them completely.
Patanjali's dispute began in 2022, when the company ran a poster named “Misconceptions Spread by Allopathy: Save Yourself and the Country from Misconceptions Spread through the Pharma and Medical Industry." In this advertisement, Patanjali claimed that its medicines are scientifically proven to cure various diseases and asserted that allopathic medicine has severe side effects. Following this event, the Indian Medical Association sent a 1000 crore defamation notice under Section 499 of IPC (Indian Penal Code 1860) in the month of May 2022.
After this, the Indian Medical Association filed a petition before the Supreme Court about the disparaging advertisement in August 2022. In the first hearing in November 2023, the Supreme Court warned and threatened Patanjali against using terms like “permanent relief” in the Drugs and Magic Remedies Act, 1954, to sell its products.
Earlier, Patanjali gave assurance that they would not publish such misleading advertisements in the future. This undertaking was recorded by the court in its order. However, the company continues to publish misleading advertisements related to medicinal cures.
Upon prima facie observation that Patanjali has infringed on the undertaking, the court issued a contempt of court notice for violation of court order and asked them to file a reply within two weeks. The court also cautioned them against making any statements adverse to any system of medicine in any form.
After the company failed to respond to the contempt of court notice, the Supreme Court issued a summons on March 19, requiring Baba Ramdev and Balkrishna to appear personally before the court.
On March 21, Balkrishna, the company's managing director, issued an unequivocal apology.
The supreme court warned Baba Ramdev and Balkrishna about disobeying the law and scolded them for their "absolute defiance" in failing to file a suitable affidavit in response to the deceptive ads in a follow-up hearing on April 2. The Supreme Court rejected their apologies and directed them to provide an affidavit within a week.
On April 15, the apex court suspended the manufacturing licenses of 14 products of Patanjali Ayurvedic Ltd. and Divya Pharmacy under Rule 159(1) of the Drugs and Cosmetics Rules, 1954, with immediate effect, and ordered the Uttarakhand State Licensing Authority to file an affidavit by April 29.
The apex court judgment on 7 May 2024, in this case is significant since it directed the Centre to notify all advertising companies to give in a self-declaration certificate prior to broadcast any type of advertisement online or in print. Additionally, celebrities and influencers are equally liable for promoting and endorsing misleading advertisements online.
This case played a pivotal role in strengthening current regulations and striking against various giant companies that mislead consumers in the name of authenticity. This case opened the door for legislation to frame new rules and guidelines to tackle real-world problems and protect consumers' rights
Self-Declaration Certificates: Preventing Misleading Ads
Following the Higher Court order in the matter of Indian Medical Associations & Anr. Vs. Union of India & Ors 2022, the Ministry of Information and Broadcasting, notified all advertising companies to provide a self-declaration certificate. The Centre informed the advertising agencies to upload the self-declaration certificate on the Ministry of Information &Broadcasting's “Broadcast Seva Portal”.
For print advertising, the agencies must submit the declaration on the “Press Council of India's portal” signed by an authorized representative of the advertisers. In the self-declaration certificate, the agencies must declare that they are not making or promoting any false claims about the products or services before publishing them on social media or in the market. They must also declare that the declaration certificate complies with the rules and regulations of the market, including “Rule 7 of the Cable Television Networks Rules, 1994” and “The Norms of Journalistic Conduct of the Press Council of India”.
This will be a transformative strategy to prevent the market and consumers from being misled by false or misleading products. The directions for the certificate were given in the during the hearing of Patanjali case This step will protect consumers from being trapped by false, deceptive, or misleading advertisements.
Advertising agencies must upload the self-declaration certificate after June 18, 2024. For ongoing advertisements, there is no need to submit the declaration certificate. Along with the declaration certificate, the representative must submit their mobile number, email address, ad details, a description of the product or service, the script of the product or service, and additionally, a link to the audio/visual elements or a PDF if the ads are in print form. They must also inform about the date of publishing the said ads in the declaration certificate. For ads certified by the “Central Board of Film Certification,” a copy of the certificate must be submitted with the self-declaration certificate.
The step taken by the Centre government in the direction of the Supreme Court will strengthen the current regulations, create transparency, authenticity, and fairness in the market, and prevent consumers from being misled by false products or services through advertisements. It will also make advertising agencies more accountable if they are found to be producing misleading advertisements.
Influencers and Celebrities: Misleading Ads and Regulations.
In the recent directive for the self-declaration certificate, the Supreme Court in the hearing of Indian Medical Associations & Anr. Vs. Union of India & Ors, 2022 stated that influencers and celebrities will be equally liable and accountable for promoting and endorsing deceptive, false, and misleading information through advertisements, especially in the category of food and health products
The "Department of Consumer Affairs, under the Ministry of Consumer Affairs and Public Distribution" On January 20, 2023 established recommendations dubbed "Endorsement Know-Hows!" aimed at influencers and celebrities addressing endorsements on public platforms . After this, On March 6, 2023, the Ministry of Consumer Affairs, Food & Public Distribution released guidelines for celebrities, influencers, and virtual influencers on social media platforms.
These guidelines aim to ensure that individuals, whether celebrities or influencers, do not deceive their viewers when promoting or recommending any product or service. The rules also ensure that these individuals comply with the “Consumer Protection Act 1986” other related laws, rules, and guidelines. Additionally, the rules aim to ensure that celebrities and influencers maintain transparency, fairness, and authenticity with their audiences.
According to the guidelines, celebrities and influencers should use words like “sponsored,” “collaboration” or “paid promotion” They must non promote any kind of product or service that the not authentic or they have not personally used or experienced. The guidelines clearly state that anyone who has access to an audience or can influence their purchasing decisions must disclose their relationship, authority, or position with the product. This disclosure must be part of the endorsement message and should be clear, prominent, and very difficult for the audience to miss. The disclosure should not be attached to any group of links, hashtags, or keywords.
For picture endorsements, the declaration should be laid over the images or be sufficient for viewers/ audiences to notice. For audio or video endorsements, the disclosure must be displayed regularly during the live streaming. Celebrities and influencers must personally experience or review the product or service before advertising it to their audiences.
Law & Regulations against Misleading Advertisement
- “The Consumer Protection Act, 1986, Section” 2(1)(r), describes "Unfair Trade Practices" as a kind of trade practice aimed at indorsing the sale or supply of goods, products, or services. This includes any unfair method, unfair practice, or any kind of false or deceptive information, all of which fall under the term "unfair trade practice."
- On June 22, 2022 the Central Consumer Protection Authority (CCPA) issued rules on 'preventing deceptive advertisements and endorsements for false advertisements, 2022, to protect consumers' rights from misleading advertisements in the market. The scope of these guidelines applies to all advertisements, manufacturers, service providers, traders, advertising agencies, and associates. These guidelines aim to protect consumers from misleading practices in the market and ensure transparency and fairness. The guidelines contain conditions to ensure that advertisements are non-misleading and valid, such as:
- Truthfulness and honesty in representation.
- It does not contain any form of misleading information, including providing excessive benefits.
- Not suggesting any kind of general or universally accepted claim about the product or service.
- Restraining any kind of claim that misleads consumers.
- Ensuring advertisements are in accordance with market rules and regulations.
To attract consumers/customers, bait advertising is permitted under these guidelines. These guidelines have helped protect consumers from unethical and misleading practices.
- The Advertising standards council of India(ASCI) issued “The code for self-regulation of advertising content in India ;- Chapter 1 (4) of this code states that advertisements cannot falsify information or deceive consumers in any way, including by implication or omission.
- “The Food Safety and Standards Authority of India (FSSAI)” the Section 53 of the “Food Safety and Standards Act, 2006” makes deceptive advertisements punishable in India. It also requires that ads be truthful, practically possible, and scientifically substantiated or section 24 prohibits the advertisement or trade practices that are misleading and deceptive about the food. Additionally, The Food Safety and Standards (Advertisement and Claims) Regulations, 2018, focus mainly on food and related products, while the standards set by the Central Consumer Protection Authority (CCPA) apply to goods, products, and services.
- The Drugs and Magic Remedies (Objectionable Advertisements) Act, 1954: Under Section 4, it bans deceptive advertisements associated to drugs that directly or indirectly give a false and fake brand concerning the true character of the drug, including dishonest claims and misleading information about the drug or medicine. Section 5 of the same act prohibits any person or professional from claiming in any advertisement or publication that magical remedies can treat certain diseases and disorders.
- The Legal Metrology Act, 2009: Under Section 11, Subsection (1)(c), it prohibits the preparation or publication of any advertisement, poster, or other document of quotation or otherwise than in terms of standard units of weights, measures, or numeration.
- The Legal Metrology (Packaged Commodities) Rules, 2011: Under Section 23(1), if the Director or Controller of Legal Metrology or an officer finds that the quantity is not in accordance with the package label, or the package is deceptive or misleading to customers, or not in accordance with the law and rules, the officer can seize the products and take appropriate actions according to the law.
- The Cable Television Networks (Regulations) Act, 1995: the Section 6, of this act describes at all advertisements under this act shall comply with the code specified by the Advertisement Standards Council of India.
- Section 5 of the Cigarettes and Other Tobacco Products (Prohibition of Advertisement and Regulation of Trade and Commerce, Production, Supply and Distribution) Act, 2003, strictly bans the promotion of cigarettes and other tobacco-related items in any form.
These are the current regulations and laws related to the prevention of misleading advertisements in India. However, a large part of society is still unaware of these laws. The government should initiate a campaign to raise consumer awareness about the existing regulations.
Penalties and protective measures for misleading advertisement
Section 21: - under this if this is proved or finds by the investigation that the advertisement is false and misleading, or infringe the consumer rights or interest. Then the central authority may issue order, direction to discontinuous the advertisement and impose a penalty on endorser, publisher or manufacture.
Section 89: - under this punishment is prescribed for misleading advertisement, any manufacture, or service provide finds to cause misleading advertisement a with prejudicial to consumers interest, mean to be penalized imprisonment extended to 2 years with fine which extended to 10 lakh or subsequent offence shall be 50 lakhs. These two section penalised misleading advertisement under consumer protection act, 2019.
The section of 7 of “The Drugs and Magic Remedies (Objectionable Advertisement) Act, 1954”, stated that whoever violates any provision of this act liable for first offense imprisonment extended to 6 months or subsequent conviction one year, fine, or both.
One of the primary reasons behind the growing number of deceptive advertisements is the deficiency of penalties. The government has also reframed the penalties and made them stricter. By the way consumer protect is widely covered and protect the consumers interest but the emerging problems needs to be tackled by new regulations.
Preventive measures for consumers
Raise Complaint: Always report misleading or fake advertisements to the appropriate authority and file an online complaint on government portals, such as the Central Consumer Protection Authority (CCPA).
Check Label of Product: Before purchasing any product, always check and verify its label, including the ingredients used, weight, measurements, and quantity of the product.
Be Aware of the Law: Stay informed about current consumer laws and regulations, such as the Consumer Protection Act 2019, and update your knowledge regularly. Avoid relying solely on advertising claims and conduct your research.
Inquiry: Before purchasing, collect verified information about the product or service and ask appropriate questions to the seller, and verify the certificate issued by the concerned authority.
Collect reviews and testimonials- before purchasing, always collect the reviews and testimonials about the product and services, for those who used or experienced. Especially in the digital era, when consumers buy products from online platforms.
Author: Neeraj Kushawah, Student at Gujarat National Law University, Gandhinagar. Views are personal!