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Advertising watchdog steps in to protect the advertising ecosystem in India

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Ranjan Narula, Abhishek Nangia and Daleep Kumar of RNA Technology and IP Attorneys take a look at how the Advertising Standards Council of India has been addressing the advertising ecosystem in India

In the changing business landscape, many businesses use the digital medium to promote their services, and many new companies have emerged that are digital-only. 

The last two years of COVID-related disruption has caused many businesses to work on their digital strategy to connect with consumers and grow their market share. The Advertising Standards Council of India (ASCI) has been actively working to fulfil its mandate to bring transparency to protect consumers, brands, and the advertising ecosystem at large. 

This article provides a brief round-up of steps taken by ASCI during the last two years to address the changes in the business environment to balance the consumer and business needs.

Advertising of virtual digital assets

Crypto and non-fungible tokens (NFTs) are gaining traction in India in recent months, even though it has still not been granted legal status in India. ASCI issued guidelines on advertising and promoting virtual digital assets (VDA) and related services to safeguard the interests of consumers so that they are not coaxed to invest into these riskier assets. These guidelines, issued on February 23 2022, apply to all VDA-related ads published on or after April 1 2022 and have been covered in detail in our previous article.

Guidelines for influencer advertising on digital media

Considering more consumers buying goods online, brand owners frequently use influencers for marketing their products. ASCI unveiled guidelines making it mandatory for the influencers to label the promotional content posted on digital media with the disclosure labels viz., advertisement, ad, sponsored, collaboration, partnership, employee or free gift. 

The guidelines were rolled out on May 27 2021, making them applicable to commercial advertisements published on or after June 14 2021. The detailed note on these guidelines can be accessed in our previous article.

Brand extension for liquor and tobacco

To evaluate the genuineness of an unrestricted product or service brand extension (e.g. liquor and Tobacco) whose advertising is prohibited by law, ASCI has clarified that the objective criteria to be used to qualify a correct brand extension product or service. It says that brand extension product or service should be registered with appropriate government authority, e.g. GST/ FDA/ FSSAI/TM, etc.  The detailed guidelines issued on March 18 2021 can be accessed here.

Online gaming

The proliferation of new gaming apps and rising consumer interest during the COVID-19 lockdown led to ASCI stepping in to issue guidelines to regulate advertising surrounding gaming apps. This was necessitated as gaming advertisements often target people by suggesting that gaming could be a legitimate source of income and a potential livelihood for them. These guidelines, issued on November 24 2020 came into effect on December 15 2020. Our detailed update can be accessed here

COVID-19 advertising advisory

As COVID-19 virus created havoc, several advertisements with misleading claims around COVID-19 emerged, e.g. referring to cure and prevention stemming from ‘anti-corona’ mattress or through the application of tulsi (Indian basil) drops to apparel. 

To curb these practices, ASCI issued guidelines to promoters for the advertisement of various medicinal products/services. Our detailed update issued on October 20 2020, can be accessed here

Awards and rankings in advertisements

Advertisers use awards and rankings to make superiority claims for their products and services in advertising. Due to the lack of knowledge, consumers may be led into believing that an award or ranking given to a product, institute or service makes it superior or more authentic. 

These guidelines issued by ASCI guide the advertisers for appropriate reference to award/s or ranking/s and claim/s in advertising and will assist the advertiser in understanding why ASCI’s Consumer Complaints Council (CCC) may accept or reject the mention of a specific award or ranking. The detailed guidelines can be accessed here.

Endorser due diligence service

With a view to avoiding legal liability that could be imposed on the endorsers towards the claims made by them in the advertisement, ASCI has rolled out Endorser Due Diligence service. It is a paid service, and endorsers can seek the help of ASCI’s multi-disciplinary panel to assess the statements claims in the advertisement and examine the evidence. The notification issued by ASCI on March 10 2022 can be accessed here.

ASCI, FSSAI join hands to curb misleading claims in F&B advertisements

There has been a sharp spurt in the number of complaints filed at ASCI against food and beverage (F&B) ads. To scrutinise F&B advertisements against misleading claims made, ASCI signed an agreement with the Food Safety and Standards Authority of India (FSSAI) on July 1 2021. 

As per the agreement, ASCI agreed to identify advertisements that prima facie violate Food Safety and Standards (Advertising and Claims) Regulations, 2018, and set up a three-member expert panel to evaluate F&B advertising identified by the ASCI monitoring team. The notification issued by ASCI on July 5 2021 can be accessed here.

As advertisement plays a vital role in attracting consumers’ attention that leads to purchase decision, the guidelines issued by ASCI are steps to balance the companies and consumer interest and create a level playing field for stakeholders.   

 

 

Ranjan Narula

Managing partner, RNA Technology and IP Attorneys

E: rnarula@rnaip.com

 

Abhishek Nangia

Partner, RNA Technology and IP Attorneys

E: anangia@rnaip.com

 

Daleep Kumar 

Associate partner, RNA, Technology and IP Attorneys

E: dkumar@rnaip.com

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