Misleading Ads: Ambiguous Self-Declaration Rules Leave Advertisers In Compliance Limbo

Advertisers are lobbying for extended compliance deadlines on the new self-declaration rules as they find themselves grappling with complexities. While some face glitches caused due to the inability of the portal to handle high submission volumes, others continue submitting dummy entries for testing.Some are even in a wait-and-watch mode, citing concerns around confidentiality and increase in compliance costs even as they face challenges in interpreting the guidelines and its potential impact on marketing strategies.The guidelines came after the Supreme Court had said last month that no ads would be disseminated on print, TV or online without the advertisers providing a self-declaration to certify that their ads are not misleading. Hearing the case against misleading ads by Patanjali Ayurved, the apex court had raised concerns about such advertising practices that deceive consumers.Earlier this month, the Ministry of Information and Broadcasting asked all advertisers and advertising agencies to submit a self-declaration certificate for all new print, digital, television and radio advertisements from June 18."We're observing a rise in interim applications filed before the Supreme Court seeking clarifications on the new regulatory rules," Nilesh Tribhuvann, managing partner at White & Brief Advocates & Solicitors, said.The new rules aim to enhance transparency and consumer protection, but they inadvertently hinder ease of doing business and add an unnecessary compliance burden, says Tribhuvann. "Businesses may face higher operational costs to ensure adherence, requiring legal and compliance expertise.".The rules may constrain creative marketing efforts, leading to operational delays and potential revenue impact due to stricter content-review processes.Nilesh Tribhuvann.The Association of Radio Operators, the Indian Newspaper Society, the Internet and Mobile Association of India, and the Broadband India Forum have moved the court, flagging "severe impact" on the advertisement ecosystem. Other industry bodies like the Indian Society of Advertisers and the Advertising Agencies Association of India are also contemplating approaching the top court to reconsider new regulations. They have been calling for a review of these rules and for them to be made more streamlined and business friendly.The INS has been included as a party in the case between the Indian Medical Association and the Union government before the Supreme Court. Others also want to get impleaded in this case, which is listed for hearing on July 9. They are hoping to get some clarity on issues, including practical difficulties and implementation of self-certification for digital ads.The food and beverage industry would be most affected by these new regulations, according to Kinjal Champaneria, partner at Solomon & Co. Several interim applications have been filed by such advertisers and advertising agencies, seeking six months' time to comply with the rules..Food Regulator Cracks Down On Misleading '100% Fruit Juice' Labels."We are active on the (T20) World Cup as our ads have already been released, but new ads are currently on hold as we expect the government to extend the compliance and simplify the process," Krishnarao Buddha, senior category head at Parle Products, told NDTV Profit.The current regime is "cumbersome" as it necessitates marketers to upload hundreds of pages of documents, Buddha said. He stressed on the need for further clarification, particularly for digital ads, arguing that a one-size-fits-all approach is unfeasible.If a company is producing 15 digital ads daily, it will require substantial resources to adhere to the self-declaration rule. The advantages of digital ads — speed and quick calibration — will be affected, according to Buddha.The IAMAI, which represents the digital services industry, contends that the TV Rules are being "force fit" to the digital ecosystem. It points out that the digital ecosystem is already subject to regulations under the IT Act, Drugs and Magic Remedies Act, Drugs and Cosmetics Act, Consumer Protection Act and Guidelines against Misleading Ads. It warns that imposing additional requirements could impede the projected growth of the digital industry to over Rs 62,000 crore by 2025.The absence of a dedicated regulatory body further complicates the situation."One can continue to cheat the system with a self-attested declaration, on which penal action is still unclear, and everyone knows that there is no one really watching!" Sandeep Goyal, managing director of advertising agency Rediffusion, said..Regulatory compliance alone, without an effective policing mechanism, will not address the core issue of curbing the proliferation of misleading advertisements.Sandeep Goyal.There are also concerns around confidentiality and expenses facing advertisers and publishers across newspapers, broadcasters, and digital platforms. "Given the submission portal is publicly accessible, confidentiality of an advertising campaign could be compromised, ahead of the launch," Tanu Banerjee, partner at Khaitan & Co., said.Moreover, the guidelines require distribution platforms, such as newspapers, broadcasters and digital mediums, to verify submission of the self-declaration by an advertiser before running an advertisement."However, advertisement is a broad term. For example, endorsements by celebrities and influencers on social media, product placements in films are also forms of advertising. Distribution platforms may not be in the loop for inclusion of ads in content and will be unable to verify a self-declaration in such cases," Banerjee said.It is also unclear if advertisements in different languages will require advertisers to file different declarations for each language, akin to the requirement of different censor certificates for the same film in different languages. Some of these challenges can be streamlined if more formal guidelines are put in place for this compliance, she said..Time Is Money: Titan To Enter Super Luxury Watch Market With Zeus Stores.It is unclear how other regulators, such as the Central Consumer Protection Authority, or different regulators under sector-specific legislations would benefit from this information on the ministry's portal to monitor and address misleading advertisements, according to Stella Joseph, partner at Economic Laws Practice.Digital platforms like YouTube, Facebook, Instagram and X run lakhs of ads daily. Nearly 34 crore ads were published on the internet and digital media by 1.3 lakh advertisers. In print media, 30 lakh ads were released by roughly 1.5 lakh advertisers, while 8.6 crore ads were aired by 8,000 advertisers annually on TV, according to the data from TAM Media Research.Advertisers encountered numerous technical errors and lags on the first few days while they were trying to submit self-declarations on the Broadcast Seva website for TV and radio ads, and the Press Council of India website for print and digital ads, according to industry executives..There were over 23,794 entries, including dummies, as of Sunday, as per the Press Council of India site. At least 2,703 entries have been recorded on the Broadcast Seva website. Brands like Sony LIV, Dream11, Dermicool, Reliance Retail, Hyundai, Star India Pvt., Navratna Cool Talc and Patanjali are the early registrants on the portals. Many are hurrying to obtain certificates to avoid delays in rollout of their campaigns amid the ongoing discussions between industry representatives and officials aimed at addressing concerns and provide clearer guidance. Small and mid-sized companies will be hit the hardest as they rely heavily on online advertising and may not have the resources to comply with the new rules, the IAMAI said in its petition. Existing laws like the IT Act and the Consumer Protection Rules already have robust mechanisms to deal with misleading online ads. Stronger enforcement of these laws would better protect consumers than the new rules, the industry body said..Heatwave, Global Conflict Strain Milk, Wheat Supply But Consumers Won't Feel The Pinch

Misleading Ads: Ambiguous Self-Declaration Rules Leave Advertisers In Compliance Limbo

One can continue to cheat the system with a self-attested declaration, on which penal action is still unclear, says Sandeep Goyal of Rediffusion.

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Misleading Ads: Ambiguous Self-Declaration Rules Leave Advertisers In Compliance Limbo

One can continue to cheat the system with a self-attested declaration, on which penal action is still unclear, says Sandeep Goyal of Rediffusion.

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