This article titled ‘Conundrum Around Misleading Advertisements- Role of Ethics and Law (in reference to ASCI Guidelines)’ is written by Nilanjana Banerjee and deliberates upon the legal provisions for fake advertisements along with their social consequences. I. Introduction Advertisements have both positive and negative effects on consumers, their thought processes, their choice of goods and hence their life. Every… Read More »

This article titled ‘Conundrum Around Misleading Advertisements- Role of Ethics and Law (in reference to ASCI Guidelines)’ is written by Nilanjana Banerjee and deliberates upon the legal provisions for fake advertisements along with their social consequences.

I. Introduction

Advertisements have both positive and negative effects on consumers, their thought processes, their choice of goods and hence their life. Every individual is a customer and the goods they use can create a huge difference in their life (like health supplements, food items).

Additionally, a consumer chooses goods based on the features as said in advertisements.

This analogy, in short, shows that advertisements play a very vital role in a consumer’s life. John W. Crawford[1] has very correctly pointed out-

“Advertising is an instrument in the hands of the people who use it. If evil men use advertising for base purposes, then evil can result. If honest men use advertising to sell an honest product with honest enthusiasm, then positive good for our kind of capitalistic society can result.”

These ads have the potential to manipulate the consumer’s thought process, hence if advertisements exaggerate the benefits uselessly, the consumer might get attracted to buy it in hope of acquiring such benefits, however, instead of benefits, they suffer a loss.

This is misleading the consumers and such advertisements are called misleading advertisements. The most vulnerable section i.e. those who can be lured away easily are kids, youth and poor (also uneducated). Most people are unaware of the legal provisions and ASCI guidelines that can rescue them from the trap of misleading and fake advertisements.

Several popular brands like Horlicks, Patanjali, Gilette, Dabur have been dragged to court for misleading advertisements.

Advertisements hold an immense manipulative power that contributes to the consumer thought process and purchasing decision. Hence, the advertisements should reflect the correct features of the product, they otherwise can have a harmful effect on a vulnerable section of society (especially children and youth).

It is a powerful instrument in shaping attitudes and goes beyond the conveyance of mere truthful information. Rules of ethics also have a significant role to play, while portraying obscene and unethical scenes can have a detrimental effect. Indian economy is on a continuous trail of expansion and this has become a reason for the Indian advertising agency to celebrate.

The growing businesses are looking for a tool to advertise their lucrative business and there is a resultant boom in advertising agencies. More competition, more advertisement and more the scope of displaying false information.

Hence, in this expanding market protection of consumer interest holds a weighty position. With changing time, the scenario of consumer interest has changed, thus the laws need to be adept accordingly.

Advertising is not just limited to goods, but trade, services, crafts, properties also and it is expected that there is a consolidated legal framework addressing the misleading advertisements, consumer rights, duties, consumer education, dispute resolution mechanism, regulation of unfair trade practices.

The Consumer Protection Act,1986 (hereinafter mentioned as COPRA) is the umbrella legislation concerning a vast range of issues. The enactment in association with other rules like ASCI guidelines, Securities and Exchange Board of India Guidelines for advertisement by Mutual Funds 1996, Food Safety and standards act, Drug and Magic Remedies (objectionable advertisements) act 1955, Indecent Representation of women (prohibition) act 1986, Infant Milk Substitute Feeding Bottle and Infant Foods (regulation of production, supply and distribution) act etc address the consumer and advertisements snag.

II. What is a Misleading Advertisement and what are its effects?

An advertisement is a marketing tool used for sales promotion and publicity. So an advertisement becomes false when untruthful and deceptive statements are used. It publishes an incorrect understanding of the product. An advertisement is published with the objectives of

  1. Identifying new product
  2. Increasing sale.
  3. Creating a brand image, loyalty, goodwill.
  4. Informing the customer with necessary information like price, quality, ingredients.

As per US Federal Trade Commission Act 1914, deception in advertisements occurs in the following conditions-

  1. There is misrepresentation or any such practices which are likely to mislead.
  2. The customer is acting responsibly,
  3. The customer injury is possible and the consumer is likely to have chosen separately if there is no deception

However, a misleading advertisement does not serve such genuine purposes and it can affect the economic decisions of a customer, prove detrimental to the competitor.

The World Bank and the Organisation for Economic Cooperation and Development (OECD) model law mention following as deceptive and unfair practice-

  1. The distribution of false information can harm another business.
  2. Distribution of false information to customers
  3. False comparison of goods
  4. Using another’s trademark, packaging fraudulently
  5. Dissemination of any confidential information

As per COPRA, 1986, a consumer can file a complaint about misleading advertisements and certain categories of it are laid in the definition of ‘unfair trade practice’ under sec. 2(r)[2]. It includes making any statement be it oral, written or through visible representation, which falsely represents-

  1. Quality, quantity, grade, style, price of the good.
  2. Standard or quality of service
  3. Sponsorship or approval of good or service
  4. Sponsorship or affiliation of the seller
  5. Warranty period, the life of the product, the efficacy of it
  6. Promise to repair it, replace it if damaged
  7. Disparages the trade of other people.

However, the newly amended provision of COPRA has laid an explicit definition of misleading advertisement.

Sec. 2(28)[3] defines misleading advertisement as-

Any advertisement relating to product or service which-

  1. Gives a false description of the product or service
  2. Gives untrue information about the guarantee of product or service, nature, quality, the quantity of the same
  3. Represents falsely about the manufacturer or seller
  4. Deliberately conceals some information

Then the advertisement will be called a misleading advertisement.

From all these features laid down, it can be summed up that misleading advertisements can take different forms, however, they are supposed to be

  1. Violative of
  2. Of consumer’s right to information
  3. Consumer’s right to safety
  4. Consumer’s right to choice
  5. Harmful to
  6. Children
  7. Public health

There are two broad categories of misleading advertisements, the first one being violative of consumer’s right to information, choice, while the second meddles up the public health, the efficacy of drugs, health gadgets.

Some examples of misleading advertisements-

  1. The advertisement of Maaza Mango drink claimed in their ad that the drink is made up of pure mango. However, preservatives and artificial flavours were added to it.
  2. Fair and lovely beauty cream had set the beauty standard as being ‘fair’ and claimed that their product can lighten the complexion, but they were made to change their name to ‘Glow and Lovely’.
  3. Novartis India claimed that their lenses are disposable and it does not have protein build-up. But it was found later that build-up is a natural biological phenomenon with all contact lenses.
  4. ‘Speed height’ medicines claimed to increase height without causing side effects, later it was seen that it tended to increase weight unhealthily.

These illustrations made it clear that misleading advertisements cause asymmetry of information.

III. What makes it misleading?

Several acts regulate different aspects of advertising, as some deal with food items, some with infant foods, some give general broad ideas, some about drugs, magic remedies etc. This heading of the article will discuss such rights mainly in reference to COPRA,1986 and additionally, it will briefly discuss a few more acts.

  1. Food safety & standards act 2006– this act was brought in so that there is one agency to deal with food laws and remove any confusion about food laws. It aimed at laying scientific standards for food articles, regulating storage, distribution, manufacture of food. And most importantly ensure food safety. S. 24, 52, 53
    [4]
    places restrictions on misleading ads and also makes it punishable.
  2. Drugs & magic remedies act, 1954– it aimed at controlling ad of certain drugs which were alleged to have magical healing. It even restricts a medical practitioner from taking part in any ad which falsely claims about drugs.
  3. Drugs & cosmetics act, 1940– it regulates production, manufacture and sale of drugs & cosmetics in India and imposes a fine of up to Rs.500 on any person for extracting report of test analysis at central drugs lab.
  4. Indecent representation of women (prohibition) act 1986– it forbids the depiction of women in an offensive or derogatory manner and prohibits anyone from being a part of such an advertisement.

Rights laid down (COPRA)-

1. Right to Information– It has been mentioned as the right to be informed about the quality, quantity, potency, purity, price of goods. These are significant to assess the true value, reliability, suitability of the product.

Hence it was made mandatory that the labels of the goods should contain standard information for consumer safety. A plethora of advertisements fall under this category like children health drinks, cosmetics, food items etc.

If infant health drinks like Enfagrow, Pediasure, Amul spray, Lactogen etc display false nutritional value details, then it would affect the parent’s choice for their kids. Every parent would want to provide their kid with the best, in that case, suppose the sugar content in them is false described, then the parent’s right to information about the good is violated, hence they are not able to provide the correct supplement.

Another humongous industry where this massive mind game is played in the cosmetics industry. Rejection in the job, marriage is many a time ascribed to physical attributes like dark complexion, overweight etc.

The industry takes benefit of this and launches products which they claim to lighten up the complexion in a few days, or tone up the skin and reduce weight. However, their claims might not get fulfilled, but they end up luring the customers in a psychosomatic manner to undertake this expenditure.

Quite similar is the case for food items that depict false food colourings, calorie counts, ingredients claiming faster and healthier impact. Though, their claims might be a sheer sham. Like the fruit juice brands Real, Tropicana claim that their products are made of genuine fruits with added preservatives or sugar, but this may not be the absolute truth. Hence they are misleading consumers into buying their products.

Another pertinent thing worth mentioning is the advertisement of alcohol and tobacco which are banned. These are still advertised as sponsors to any music CD, cricket or any such program which has a wide coverage. This devised method for the advertisement of banned products is called surrogate advertisement.

2. Right to Choice– the false information rendered to the customers affect the choices they make. Suppose, the actual sugar content in any health drink is disclosed, the consumer would have been at a better place to compare and purchase.

Likewise, in automobile advertisements, the dealers increase the mileage count. One noteworthy incident in this context is that of Maruti Suzuki in Delhi, where the dealer induced Rohini to buy a car by misleading her about the mileage.

On complaining the New Delhi Consumer Disputes Redressal Forum was asked to pay compensation, conduct a fuel efficiency test and then inform the minimum and maximum possible mileage to the customer. The significant information is concealed and it ultimately affects the purchasing decision.

Moreover, in the sale of products, there are terms and conditions which are not laid down openly, rather in a small font concerning the asterisk mark. Such terms and conditions have a considerable impact on the choice of goods.

3. Right to Safety– This class of advertisements is the most dangerous of all as it can have severe repercussions on the health of the purchaser. Such instances have been heard of where people are tempted to lose weight or increase their height for the same, they try several medicines or even opt for surgeries.

The success rate of such surgery is not guaranteed and mishaps happen too. One such incident was eye surgery where the patient consented to the laser surgery based on the doctor’s claim that she could get rid of spectacles. However, in reality, nothing of such sort was possible, hence the patient’s eye was impaired. The consumer dispute redressal commission fined the doctor one lakh for misleading the patient.

Moreover, the generic medicines available over the counter do not talk about the side effects that might result, this too affects consumer safety.

These three aforementioned rights are those umbrella rights which when violated lead to misleading advertisements.

IV. Ethics in Advertisements

Prior to understanding the role of ethics in advertisements, it is highly pertinent to know what ethics is. Ethics means good conduct or conduct which is right in view of the society and time period.

It is the moral principle that governs our actions and distinguishes good from bad. Advertisements are a mixture of arts and facts that hold the power to influence a consumer’s purchasing decision.

Hence they need to display the truth, credible and ethical enough. Ethics in ads is important because acting ethically would make the customer believe that the brand is responsible towards them and are giving them the correct information. so that they can make a well-informed decision. Companies can show their morals through advertisements and make the customer feel the difference.

Customers do not always have the opportunity to communicate directly with the company and know the morals. It is the advertisements that can enlighten them. In such situations, misleading advertisements can create an impression that ‘the brand is unethical’.

For benefit in the longer run, the companies need to keep all their stakeholders happy and customers are one among them. Acting ethically can foster the desire of a consumer to remain loyal to the brand and this, in turn, will enhance the sustainability of the brand.

Consumers decide to buy a good only after knowing its features and determining its suitability. The consumer satisfies itself to purchase a good mostly by the advertisements, if ads are false, it will repulse the customer from buying it the next time. Thus companies should be careful while making claims in advertisements.

This will make their brand reliable and ethical. However in today’s competitive market, due to untruthful advertisements, credibility is lost. The claims made are highly exaggerated, or inappropriate scenes are used, hence the advertising agency has been criticised very frequently. The ethical issues identified in advertisements are-

  1. Vulgarity/ obscenity
  2. Controversial products
  3. racial issues
  4. Following stereotypes

There is a wide range of advertisements that are unethical and some of them are described hereinafter. The ads for condoms do not serve the purpose of informing people about the protection it offers from STDs and unplanned pregnancies. The scenes of such ads tend to promote sexual activities more than promoting the use of condoms as a safety measure. Another ad on this list is of Pan Masalas.

They are severely harmful to health but are visualised in ads as they are the essence of life and passion. Earlier the tagline of Vimal Pan Masala was ‘daane daane me Kesar ka dum’, which signified that it has Kesar and is healthy. In this way, brands use unethical methods to manipulate consumers to buy things.

ASCI (Advertising Standards Council of India) has been very strict with unethical ads and it has upheld several complaints. Some of them are-

BRAND NAME COMPLAINT
Ponds Pure White Face Wash by Hindustan Unilever The ad claimed it has carbon which goes deep inside the skin to remove dirt and gives an instant glow, helping in preventing premature ageing. However, there was no data to support this claim.
Sun Silk Perfect Straight Shampoo by Hindustan Unilever The ad showed that a girl was packing her hair straightening equipment and her friend tells her that Sun Silk perfect straight shampoo can give her perfectly straight hair even after the gym. But the ad did not give details about whether it applies to every hair type and texture.
Maruti Swift by Maruti Suzuki India The ad showed a minor wearing sunglasses and driving a swift car recklessly. It violated traffic norms.
Surf Excel Liquid Detergent by Hindustan Unilever The ad showed a child playing with ink and sprinkling it on her face, teeth, shirt. This ad is negative as the children might get vulnerable and sprinkle ink of themselves which is a toxic liquid.

If this making of false claims continues, consumers will lose faith in that brand and the brand will lose its customers. Hence the ad should be ethical, which means it must display correct information, do justice to the customers.

The success of an ad depends on the public confidence the company gains and false advertisements have the capacity to impair such building confidence, resulting in loss of goodwill. Hence the impact of unethical advertisement goes beyond financial loss to the company and brings a bad name.

V. ASCI Guidelines to Regulate Advertisements

ASCI stands for Advertising Standards Council of India is established in 1985 and is committed to regulating advertising and ensuring conformity to the code of self-regulation.

It is a voluntary council registered under s.25 of the Indian Companies act[5]. It works in collaboration with different ministerial bodies and agencies.

  1. ASCI has partnered with the Department of Consumer Affairs to address the complaints concerning misleading advertisements.
  2. Food Safety and Standards Authority of India has partnered (through MOU) with ASCI to address the false ads in foods and beverages.
  3. Ministry of AYUSH and ASCI have collaborated to address AYUSH related false advertisements.
  4. ASCI is a part of the steering committee to regulate ads on tobacco and related items.
  5. Drug Controller General of India (DCGI) recognised its codes in advertising.
  6. Insurance Regulatory and Development Authority also asks for adherence to ASCI guidelines.
  7. ASCI forms a part of the committee set up by the National Highway Authority of India (NHAI) to regulate automobiles ad.

In 2017, the Supreme Court in the case of Common Cause v. UOI and others[6], had affirmed the self-regulatory mechanism developed by ASCI. The Supreme Court Committee on Road Safety had given special heed to ASCI guidelines. It is a stakeholder at several important ministerial departments.

From all these, it can be safely summed up that ASCI has a wide network for functioning and effectuating its purpose of-

  1. Ensuring truthfulness and honesty in the claims made in the ad
  2. Ensuring the ad is not offensive to the public standards of decency.
  3. Safeguarding against indiscriminate use of advertisements
  4. Ensuring fairness in competition and well-informed decisions for the customers

The responsibility to observe this code is on those who create, publish ads or who assist in doing so, as it is a self-imposed discipline.

ASCI, as a regulating body has laid down specific guidelines for different categories of products. However, it has set some basic norms for the advertisement of every kind-

  1. Truthful and Honest representation- All the claims shall be ascertainable facts capable of being substantiated. It shall not distort the originality.
  2. Non- offensive to public decency- It should not contain any vulgar indecent depictions especially of women.
  3. Against harmful products and situations- No ad should incite the public for violence, crime, discrimination or destroy friendly relations with any foreign country. No such ad shall be published which encourage minors to enter strange places, converse with strangers, play with explosives, sharp objects. Moreover, it should not feature the use of alcohol, tobacco or promote any such thing which is forbidden by law.
  4. Fair competition- Direct comparison of goods is permitted only when there are clear aspects of doing so and it is in the interest of public enlightenment. The comparison should be factual, well-substantiated and not for acquiring artificial benefits. In the case of Reckitt & Colman of India Ltd. v. M.P. Ramchandran[7], Calcutta High court had said a seller is permitted to declare his good better than a competitor’s, however, he has no right to defame the goods of his competitor. If there is no defamation, then there is no question of disparagement.

Other than its regulations, it also considers other enactments. ASCI does not accept such advertisements which are violative of the provisions of the following enactments-

  1. Drugs and Magic Remedies act, 1954
  2. Cable Television Network Act
  3. Patents Act, 1970
  4. Drugs and Cosmetics Act 1940
  5. Emblems and Names Act 1950
  6. Trademarks Act 1999
  7. Copyright Act 1957
  8. Indecent Representation of Women Act, 1986
  9. Prasar Bharati act 1990

VI. ASCI Guidelines for specific Advertisements

1. FOOD & BEVERAGE-

  1. The ad should not deceive the consumer to believe that consuming such a product will cause personal changes like intelligence, physical ability unless any scientific evidence is available.
  2. All the health and nutritional claims made shall be substantiated by scientific evidence and meet the requirement of Food safety standards rules.
  3. The ad should not aim at replacing or disparaging the normal accepted diet pattern like fresh fruits, milk etc. Neither it should undermine the nutritive value of natural foods or beverages.
  4. Advertisements should not encourage over or excessive consumption of any food or beverage.
  5. The ad without any prior consent should not imply endorsement by any professional or governmental body.
  6. Claims made in an ad should not be inconsistent with the information in the packaging of goods.
  7. The advertisement should not aim to undermine the value of parental guidance in making food choices.

2. EDUCATIONAL INSTITUTION-

Unlike the tangible product, which can be judged by inspection, education is the training that cannot be judged similarly.

  1. The ad shall not deceive the public to believe that the course is authorised, affiliated, official, endorsed unless it can be substantiated.
  2. In case the affiliation to a mandatory institution is done via another institution, it shall be mentioned and its font size shall not be less than 50% of the advertised educational institution.
  3. The advertisement shall not promise for job, promotion, salary increment and guarantee any other job prospect until and unless there is any substantiation to that effect.
  4. The advertisement shall not make any claim about the passing batch, placement, highest percentage, testimonial of toppers, ranking, admission into renowned colleges unless such students are of the latest academic year and it can be substantiated.
  5. The advertisement mentioning the number of placed students or those who got admitted to the renowned university shall also mention the total number of students in that batch.
  6. Visuals of infrastructure presented in the advertisements shall be real and existing at that time.

3. FOR NEW/ IMPROVED PRODUCTS & SAVING IN LARGER PACKETS-

  1. The claim for a new or improved product must specify which aspect of the product is improved like packaging, utility, design etc.
  2. The ad while making a claim of savings for a larger pack shall make the comparison by highlighting the number of small packets v. The larger the packet.

4. FOR FAIRNESS PRODUCTS-

Almost all fairness creams are licensed under the Drugs and Cosmetics act, however, still, there is a concern that the promotion of fairness cream would enhance the notion that dark skin is undesirable. Hence guidelines are framed-

  1. Advertisements in no way shall reinforce skin colour stereotype or portray darker skin as unattractive, depressive, inferior or relate it to rejection in job or marriage.
  2. It should not promote discrimination based on colour and associate darker skin colour with any socio-economic strata.
  3. While depicting the pre-usage of products, special care should be taken that the model does not look unattractive, unhappy, depressed.

5. FOR AUTOMOBILES-

  1. The ad should not portray violation of traffic rules, encourage unsafe or reckless driving, stunts (which require professional surveillance)
  2. Ads should encourage wearing helmets, fastening seat belts, refrain from using cell phones while driving or riding.

6. FOR CELEBRITIES-

Celebrities have a strong influence over the public and they are assumed to be credible.

  1. Celebrities are expected to have knowledge about the ASCI code and if not, it is the duty of the advertiser to make aware of it.
  2. Endorsements or representations made must be based on adequate information or experience about the good or service.
  3. Celebrity should with due diligence ensure that all the claims made must be objectively ascertainable and be substantiated.
  4. The celebrity should not be a part of such advertisement which violates the ASCI guidelines in letter and spirit.
  5. Celebrity should refrain from advertising for any such product which requires a health warning like ‘XX is injurious to health’.
  6. The celebrity should not participate in any advertisement which is prohibited under enactments like the Drugs and Magic Remedies act 1954, Drugs and Cosmetics act 1940.
  7. If the celebrity seeks advice from ASCI whether an ad violates its guideline and thereafter, the ad is framed as per advice, then it will be believed that the celebrity has performed due diligence.

7. FOR DISCLAIMERS-

  1. The disclaimer can expand claims made, resolve the ambiguities, give details, but it must not contradict the main claim. Ex- ‘Cashback’ on recharge. The disclaimer to this cannot be inconsistent with the claim by giving virtual cashback or payback in kind.
  2. The disclaimer shall not conceal any information or omit any description which will make it deceptive. Ex- if there are certain conditions applicable on the offer, then ‘T&C must be mentioned.
  3. The language and font of the disclaimer shall be the same as of ad and the disclaimer shall not be in italics.
  4. It shall be placed at a prominent position and direction shall be along with the advertisement with no rotation of head or product needed. Exception- for packages less than 25 ml, this rule does not apply.
  5. It shall be in the font size of at least 25% of original writings, should be legible, visible to a normally sighted person. For the voice disclaimers, it should sync with the main program.
  6. The pictures used shall be of a fixed pixel count and size as laid down in rules.
  7. In times of colour and contrast, the text or pictures shall be legible, opaque and no such abbreviation shall be used which is not normally comprehensible.
  8. The disclaimer shall be present on screen for more than 4 sec for every line and if spoken, the speed shall not be more than 6 syllables per second.

8. FOR INFLUENCERS-

Before moving into the guidelines, it is pertinent to know who an influencer is. An influencer is a person who has the power to affect the audience’s opinion about a product, service because of their authority and knowledge. This guideline extends only to digital media. The social media platforms which have been included here are Instagram, Twitter, Facebook, Pinterest, YouTube etc.

  1. It mandates giving a disclosure (clarification) about the piece of communication as an advertisement. The responsibility of disclosure shall be on the influencer and advertiser. The labels like #ad, #collab, #promo, #sponsorship, #partnership shall be used (no other label shall be used as the consumer may not be familiar).
  2. The disclosure label should be highlighted, prominent, appropriate for the channel and most importantly, it shall be within two lines of the given platform.
  3. The language of disclosure must be English and capable of being translated into the language of the ad.
  4. If the ad is only a picture, then the label should be highlighted in the picture as to be clearly visible to the average customer. Also, such filters shall not be used which exaggerate the effect of the product, like extra shiny hair,
  5. For a video of less than 15 sec, the label should stay for a minimum of 2 sec, for a video of 15 sec to 2 mins, the label should stay for 1/3rd length of it, while for videos longer than 2 min, it shall stay for the entire duration. In live streams, the label shall appear periodically for 5 sec at the end of every minute.
  6. In the case of audio media, the label shall be announced at the beginning as well as at the end.
  7. Blanket disclosures in the bio of the account will not work because people might see one post and not visit the account.

VII. Popular Brands in Misleading Advertisements

1. DABUR INDIA v. COLORTEK MEGHALAYA[8]

Dabur India filed for an injunction against Good Knight ad alleging that it disparages Odomos cream ad. Dabur India claimed that its Odomos cream owns 84-86% of the market shares, hence, Good Knight had targeted their cream by saying that it causes rashes.

To this, Colortek Meghalaya claimed that there is a lack of cause of action as Dabur could not establish the alleged disparagement. The court held the view that just because both companies manufacture the same item does not mean that one will disparage another. Court added that prima facie there is no malicious falsehood, hence no disparagement is caused.

2. PEPSI CO. INC v. HINDUSTAN CoCa Cola[9]

Pepsi Co sued Hindustan Coca Cola for publishing disparaging advertisements for advertising the drink PAPPI (similar name) and same tagline (yeh dil maange no more). In one of the ads a child’s favourite drink was Pepsi and it was beeped but lip movement could make it out as Pepsi.

He was then asked to taste two drinks and then he chose Pappi as the Pepsi was too sweet, which only children would love. Further, it showed the leading actor’s embarrassment on finding out that his favourite drink was Pepsi. The issue arose whether there was disparagement?

The court said to answer the question of disparagement, the following three things would be looked into-

  1. The intent of the advertisement (understood from the storyline)
  2. The overall effect of advertisement (whether there is any unfavourable comparison during promotion)
  3. The manner of advertising (whether the comparison is truthful or falsely denigrates the rival)

The court found that the advertisement published had a negative portrayal of the competitor, hence it is disparagement.

3. HORLICKS v. ZYDUS[10]

Horlicks filed a petition in Delhi High Court claiming permanent injunction against Zydus from publishing an ad that showed that one glass of Complan (Zydus product) is equivalent to two glasses of Horlicks. Horlicks claimed that this ad amounts to disparagement.

Zydus claimed that the ad is correct provided the recommended serving is maintained. Delhi High Court granted an interim injunction, but Zydus modified the ad and included the disclaimer about serving size.

For deciding the case finally, the court referred to a plethora of cases like Dabur India v. Colortek Meghalaya, Pepsi Co. v. Hindustan Coca Cola, Havells India v. Amritanshu Khaitan[11], Gilette India Ltd. v. Reckitt Benckiser Pvt Ltd[12] etc.

By giving special attention to the last case, the court came to the conclusion that electronic media has a greater impact, thus its rule should be different from print media. The court held that giving a mere disclaimer, in this case, would not serve the purpose as the visual effect of two cups of Horlicks equals one cup of Complan is strong.

4. RED BULL

The energy drink, Red Bull has the tagline ‘Red Bull gives you wings. This tagline was brought into question, though as a reasonable consumer, one would believe that it cannot give wings. Eventually, it was settled for $13 million. However, Red Bull maintains that its labelling has been truthful and accurate.

5. VOLKSWAGEN

In 2016, a suit was filed against Volkswagen that its vehicles burnt clean fuel and that it cheats in emission tests. Volkswagen had the manipulated software which intentionally reduced the exhaust measure. It was a huge blow to the carmaker company and the advertisement scandal led to a fine of $90 billion fine.

6. KELLOGG RICE KRISPIES

In 2010, Kellogg claimed that its rice Krispies had antioxidants, vitamins and minerals which acted as an immunity booster. However, Federal Trade Commission ordered it to halt the ad. In 2011, Kellogg had to pay a $ 2.5 million fine and $2.5 million as charity.

VIII. Conclusion

Advertising is a very important communication strategy for business and in this contemporary world of developing technology, several mediums of advertising have come up. It acts as an external stimulus to create arousal for dormant needs.

It is a very powerful instrument that has the potential to manipulate customers. And this manipulative power is used by companies to deceive their customers. Claims made in ads are at times exaggerated, which attracts the customer. With the Indian economy on the trail of expansion, the advertising industry is also on a boom and this increases the scope of false advertisements.

This is where the role of ethics in advertisements become evident. Maintaining the ethical aspect of advertisement is very important, not only for customers but also for the restoration of Indian culture. Depiction of obscene and indecent scenes in ads shows percolation in Indian culture.

Unethical ads can damage the goodwill of a brand and ultimately it can lose its customers. Hence several laws aim to regulate false ads. The widest and most significant of all is COPRA, 1986. There are several authorities and agencies which look into the proper implementation of laws and formulate new codes.

Their main task is to control the escalating numbers of unethical advertisements like ASCI has set up a self-regulation code. Under this guidelines have been laid down for specific categories of the ad. Other regulatory agencies are the Medical Council of India, Securities and Exchange Board of India, Telecom Regulatory Authority of India etc.

People need to be aware of their rights as consumers and the remedies available to them.

Consumers should know that they can sue the seller in consumer courts and grant them reliefs like replacement of goods, refund of the amount paid, removal of deficiency from service, provide compensation.

Consumers along with law enforcement bodies can curd the malice of misleading advertisements.


References

  1. The Code for Self Regulation of Advertising Content in India, ASCI, Available Here.
  2. Guidelines for ‘Influencer Advertising on digital media’ ASCI, February 2021, Available Here.
  3. Sinha, Swati & Das, Pradip (2019) False and Misleading Advertisements and Protection of consumers: Indian Scenario, International Journal of Law & Legal Jurisprudence Studies.
  4. Cheriyam, George; Saxena Deepak & Singh Amarjeet (2012) Study on Status of Law Enforcement for Misleading Advertisement in Indi & its Impact on Customers, German Development Corporation, New Delhi
  5. Modi, Nikita & P. Ramanrao (2018) Misleading Advertisements, International Journal of Research and Analytical Reviews, Vol.6.
  6. Sharma, Jyoti; Shiny; Shivami (2015), Ethics in advertising- An Indian Perspective, International Advanced Research Journal in Science Engineering & Technology, 2(5)
  7. Sinha, Rohit (2015) Misleading Advertisements in India: A Critical Study on Violation of Consumers Rights by Patanjali Ayurved Ltd, Research Gate
  8. Girimaji, Pushpa (2013) Misleading Advertisements & Consumers, Consumer Education Monograph series, Centre for Consumer Studies Indian Institute of Public Administration.
  9. Mehta, Ankoosh; Jain, Maitrayi; Shah, Anushka (2020) The SCC Online Blog, Available Here.
  10. 6 false advertisements scandals you can learn from. Entrepreneur US, an International Franchise of Entrepreneur Media, Available Here.
  11. Rothschild, Brandy (2015) Why’s it important to have ethics in advertisement…. especially reach to Millenials, Available Here.

[1] John W. Crawford, Communication Professor, Quoted in Samm Sinclair Baker, The permissible Lie: The inside truth about advertising, 1968, Cleveland, OH: World Publishing Company.Page-180.

[2] Consumer Protection Acts, 1986, s.2(r)

[3] Consumer Protection Act, 2019, S.2(28)

[4] Food standards and safety act, 2006, s.24,52 &53.

[5] Indian companies act, s.25

[6] (1994) 3 SCC 394

[7] Reckitt & Colman of India Ltd. v. M.P. Ramchandran, (1999) 19 PTC 741, 24-08-1998, Available Here.

[8] Dabur India Ltd. v. Colortek Meghalaya Pvt. Ltd., ILR (2010) 4 Del 489, 02-02-2010, Available Here.

[9] Pepsi Co., Inc. v. Hindustan Coca Cola Ltd., (2003) 27 PTC 305, 01-09-2003, Available Here.

[10] CS (Comm) 464 of 2019

[11] Havells India Ltd. v. Amritanshu Khaitan, (2015) 62 PTC 64, 17-03-2015, Available Here.

[12] Gillette India Ltd. v. Reckitt Benckiser (India) Pvt. Ltd., 2017 SCC OnLine Bom 207, 22-02-2017, Available Here.


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Updated On 2021-12-15T13:01:34+05:30
Nilanjana Banerjee

Nilanjana Banerjee

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