Misleading advertisement industry

16 May 2024 Misleading advertisement industry

This article covers “Daily Current Affairs”, and the topic details “Misleading advertisement industry”. This topic is relevant in the “Social Issues” section of the UPSC CSE exam.

Why in the News? 

In an effort to protect consumers from deceptive advertising, the Supreme Court of India has mandated that advertisers must provide self-declarations prior to promoting products through the media. Additionally, the Union government has swiftly revoked a letter from the AYUSH Ministry that excluded Rule 170 of the Drugs and Cosmetics Rules, 1945.

Directions given by the Supreme Court

• Submission of Self-Declarations: Advertisers are now required to provide self-declarations before promoting products in the media. This entails declaring that their advertisements are not deceptive and do not contain untrue statements about their products aimed at preventing consumer deception.
• Online Portal for Advertisers: Advertisers planning to air TV commercials must upload their declarations on the ‘Broadcast Seva’ portal. This portal acts as a centralised platform for stakeholders to seek permissions, registrations, and licences from the Ministry of Information and Broadcasting for broadcast-related activities. A similar portal is set to be established for print advertisers.
• Responsibility of Endorsers: Social media influencers, celebrities, and other public figures endorsing products are now held accountable. They are expected to exercise responsibility by possessing sufficient knowledge about the products they endorse, thereby avoiding any deceptive advertising practices.
• Ensuring Consumer Protection: A transparent process is to be established for consumers to report misleading advertisements. Additionally, measures will be put in place to ensure that consumers receive updates on the status and outcomes of their complaints, thereby enhancing consumer protection.
• The directives from the Central Consumer Protection Authority (CCPA) emphasise the necessity of transparency concerning paid endorsements made by influencers.

1. Guideline 8 is regarding advertisements targeting or involving children.
2. Guideline 12 talks about the obligations of manufacturers, service providers, and advertising agencies. These guidelines aim to safeguard consumers’ trust from being compromised or exploited due to their limited awareness.
3. Guideline 13 mandates responsible behaviour in advertising, requiring endorsers to possess adequate information or experience regarding the specific food product they endorse. It further stipulates that the endorsement must not be deceptive.

• Criticism of the Decision to Exclude Rule 170: This move comes after the Supreme Court expressed disapproval of the government’s directive concerning the management of advertisements linked to Ayurvedic and Ayush products as per Rule 170 of the Drugs and Cosmetic Rules, 1945. The Ministry of Ayush instructed all State/ UT Licensing Authorities and Drug Controllers of AYUSH regarding the removal of Rule 170 (along with associated provisions) from the 1945 Rules. Rule 170 prohibits the advertising of Ayurvedic, Siddha, or Unani drugs without approval from licensing authorities.

Regarding advertisement regulations in India

• In India, the regulation of misleading advertisements is primarily overseen by several governmental bodies and legal frameworks. The key regulatory authorities involved in this process include the Advertising Standards Council of India (ASCI), the Central Consumer Protection Authority (CCPA), and the Ministry of Information and Broadcasting. Additionally, various laws and regulations are in place to address deceptive advertising practices.
• The Advertising Standards Council of India (ASCI) plays a significant role in regulating advertising content. It is a self-regulatory organisation comprising members from the advertising industry, media, and consumer activists. ASCI operates based on a code of self-regulation, which sets standards for ethical advertising practices. Advertisements that violate ASCI’s code are subject to scrutiny and can be withdrawn or modified based on ASCI’s recommendations.
• The Central Consumer Protection Authority (CCPA) is another crucial regulatory body tasked with protecting consumers’ interests and ensuring fair trade practices. CCPA issues guidelines and directives aimed at curbing misleading advertisements and unethical marketing tactics. It emphasises transparency in advertising, especially concerning paid endorsements by influencers, and holds endorsers accountable for the products they promote.
• Furthermore, specific laws and regulations govern the advertising of certain products, such as the Drugs and Cosmetics Act of 1940 and the Food Safety and Standards Act of 2006. These laws mandate that advertisements for pharmaceuticals, food products, and other regulated goods comply with stringent requirements, including obtaining approvals from relevant authorities before dissemination.

Problems Caused by Misleading Advertisements

• Consumer Deception: Misleading advertisements can deceive consumers by providing false or exaggerated information about products or services. This deception can lead to consumers making uninformed purchasing decisions, spending money on products that do not meet their expectations, or even causing harm to themselves or others if the advertised product does not deliver as promised.
• Financial Loss: Consumers may suffer financial losses as a result of misleading advertisements. They may pay higher prices for products based on false claims or purchase ineffective or substandard goods that fail to deliver the promised benefits. This can result in wasted money and dissatisfaction with the purchase.
• Health and Safety Risks: Misleading advertisements for products such as pharmaceuticals, health supplements, or medical devices can pose health and safety risks to consumers. False claims about the effectiveness or safety of these products may lead individuals to use them without proper medical guidance, potentially causing harm or adverse side effects.
• Undermining Trust: Misleading advertising erodes trust in businesses and undermines confidence in the marketplace. When consumers are repeatedly exposed to deceptive marketing tactics, they may become sceptical of all advertising messages, making it harder for legitimate businesses to reach and connect with their target audience.
• Unfair Competition: Misleading advertisements can give unethical businesses an unfair advantage over competitors who adhere to truthful and transparent marketing practices. By making false claims or misrepresenting their products, businesses may attract customers away from competitors who offer genuine products or services.
• Legal and Regulatory Consequences: Businesses that engage in misleading advertising may face legal and regulatory consequences, including fines, penalties, and damage to their reputation. Regulatory bodies and consumer protection agencies actively monitor advertising practices and take action against companies found to be in violation of advertising standards and regulations.

Download Yojna daily current affairs eng med 16th May 2024

Mains practise question 

Q1. How do misleading advertisements contribute to unfair competition in the marketplace, and what legal and regulatory consequences do businesses face for engaging in deceptive advertising practices?

Himanshu Mishra

I am a content developer and have done my Post Graduation in Political Science. I have given 2 UPSC mains, 1 IB ACIO interview and have cleared UGC NET JRF too.