Celebrities Liable for Products in Misleading Ads in India, Supreme Court

Context

Social media influencers and celebrities are under scrutiny by the Supreme Court, which declared that they will bear equal responsibility for endorsing products or services in misleading advertisements.

• IMA’s Petition Against Patanjali’s Advertisements: The court heard a petition filed by the Indian Medical Association (IMA) against Patanjali’s advertisements attacking allopathy and making claims about curing certain diseases.

Ruling by the Supreme Court On Misleading Ads in India

• Responsibility of Advertisers and Endorsers: The advertisers or the advertising agencies or endorsers are equally responsible for issuing false and misleading advertisements. 
• Significance of Public Figures, Influencers, and Celebrities: It emphasized the significance of public figures, influencers, and celebrities endorsing products responsibly during advertisements. 
• Guidelines for Transparency: It highlighted the guidelines of the Central Consumer Protection Authority (CCPA), which stresses the importance of transparency regarding paid endorsements by influencers.
  • Guideline 8: about ads targeting or involving children) 
  • Guideline 12: responsibilities of manufacturers, service providers, and advertising agencies). 
    • This ensures that consumers’ trust is not compromised or taken advantage of due to their lack of knowledge.
  • Guideline 13: requires due responsibility to be taken for advertisements and requires a person who endorses a product to have adequate information or experience with the specific food product to be endorsed, and it must be ensured that it is not deceptive.
• Responsibility of Broadcasters: The court said broadcasters need to file the self-declaration on the Broadcast Seva portal run by the Union Ministry of Information and Broadcasting.

Enroll now for UPSC Online Course

• • It further ordered the Central government to establish a new portal for filing such self-declaration forms for advertisements on print media. 
• Criticism of Directive to Omit Rule 170: The decision follows the Supreme Court’s criticism of the government’s directive regarding the handling of ads associated with Ayurvedic and Ayush products under Rule 170 of the Drugs and Cosmetic Rules, 1945.
  • The Ministry of Ayush directed all State/ UT Licensing Authorities and Drug Controllers of AYUSH regarding omission of Rule 170 (and related provisions) of the 1945 Rules. 
  • Rule 170 prohibits advertisements of Ayurvedic, Siddha or Unani drugs without licensing authorities’ approval. 

Central Consumer Protection Authority (CCPA)

Central Consumer Protection Authority (CCPA) is a regulatory body set up under Section 10(1) of the Consumer Protection Act, 2019, to handle matters affecting rights of consumers.

• • CCPA targets individuals or entities that follow improper trade practices or display inappropriate or wrong advertisements affecting public interest. 
• Composition: Chief Commissioner as head, and only two other commissioners as members, one of whom will deal with matters relating to goods while the other will look into cases relating to services.
• Nodal Ministry: The Ministry of Consumer Affairs.

Key Provisions of Guidelines for Prevention of Misleading Ads and Endorsements for Misleading Advertisements 2022

• Prohibit Surrogate Advertisements: No surrogate advertisement (like Alcohol brands advertising for sodas/music) shall be made for goods or services whose advertising is prohibited or restricted.
• Prohibit Targeting Children: Advertisements that take advantage of children’s inexperience have been prohibited.
• Penalties: Violations may lead to penalties under the Consumer Protection Act 2019 and other relevant provisions of the law.
  • CCPA can impose a penalty of up to Rs 10 lakh on manufacturers, advertisers, and endorsers. For subsequent offences, a penalty can go up to Rs 50 lakh.

DOWNLOAD PDF