In a move to safeguard consumers from misleading advertisements, the Supreme Court of India has issued directives for advertisers to submit self-declarations before promoting products in the media.In further development, the Union government has withdrawn an AYUSH Ministry letter, which “omitted” Rule 170 of the Drugs and Cosmetics Rules, 1945, with immediate effect.Rule 170 prohibits advertisements of Ayurvedic, Siddha, or Unani drugs without licensing authorities’ approval.
Key Directives from the Supreme Court
Submission of Self-Declarations
- Advertisers must submit self-declarations before promoting products in the media.
- Advertisers are now obligated to declare that their advertisements do not deceive or make untrue statements about their products in order to prevent misleading consumers.
Online Portal for Advertisers
- Advertisers intending to run TV ads must upload declarations on the ‘Broadcast Seva’ portal, which serves as a one-stop facility for stakeholders to request permissions, registrations, and licenses for broadcast-related activities from the Ministry of Information and Broadcasting.
- A similar portal for print advertisers is to be established.
Responsibility of Endorsers
- Social media influencers, celebrities, and public figures endorsing products must act responsibly.
- Endorsers should possess adequate knowledge about the products they promote to avoid deceptive advertising.
Ensuring Consumer Protection
- Establish a transparent process for consumers to report misleading advertisements and ensure they receive updates on complaint status and outcomes.
Recent Cases of Misleading Advertisements have Emerged
- The Advertisement Monitoring Committee at Food Safety and Standards Authority of India (FSSAI) identified 32 cases of misleading claims by food business operators (FBOs) bringing the total count of such violations to 170 in the last six months.
- Variety of Offenders: Violators span diverse product categories, including health supplements, organic products, and staples.
- The Supreme Court recently rebuked Patanjali Ayurved for disseminating misleading advertisements, leading to a ban on its marketing activities.
- The Indian Medical Association accused Patanjali of denigrating allopathic medicine and spreading false information about vaccines during Covid-19.
- The allegations led to legal arguments citing violations of the Drugs & Other Magical Remedies Act, 1954, and the Consumer Protection Act, 2019.
How Do Misleading Advertisements Violate Ethical Principles
- Violation of Truthfulness: Honesty and truthfulness are essential ethical principles that should guide all business practices, including advertising.
- These advertisements manipulate consumer perceptions and exploit vulnerabilities for commercial gain; they persuade individuals to make purchasing decisions based on false premises.
- Fairness and Justice: Misleading advertisements create an uneven playing field, giving an unfair advantage to companies that engage in deceptive practices over those that prioritize ethical advertising.
- This violates the principle of fairness and justice in the marketplace, as it disadvantages honest competitors and undermines consumer trust.
- Example: Companies making false environmental claims (greenwashing) to capitalize on the growing demand for sustainable products, while their competitors truthfully disclose their environmental impact.
- Consumer Harm: Misleading advertisements can lead to financial losses for consumers who purchase products or services based on false claims, resulting in dissatisfaction.
- It can also harm consumers’ physical or mental well-being if the advertised products or services are potentially harmful or ineffective.
- Erosion of Trust: Repeated exposure to misleading advertisements erodes trust in products, brands, and advertising, undermining the ethical principle of integrity in business and society.
- When consumers feel deceived, they lose confidence in the market’s integrity, as words and actions become inconsistent.
How Misleading Advertisements are Regulated in India
Definition of Misleading Advertisement
A misleading advertisement is defined under Section 2 (28) of the Consumer Protection Act, 2019, as any advertisement that:
- Provides a false description of a product or service;
- Offers false guarantees that mislead consumers;
- constitutes an unfair trade practice through express representation;
- Deliberately omits essential information about the product.