Advertising Law

Advertising Law

Advertising Law

• Advertising laws are aimed at protecting consumers by requiring advertisers to be truthful about their products and to be able to substantiate their claims.

• All businesses must comply with advertising and marketing laws, and failure to do so could result in costly lawsuits and civil penalties.

Advertising Law

• So before you start an advertising campaign, it's important you understand some basic rules.– Advertising must be truthful and non-deceptive– Advertisers must have evidence to back up their

claims– Advertisements cannot be unfair

In order to enforce an ethical regulating code, the Advertising Standards Council

of India was set up.

ASCI Guidelines• To ensure the truthfulness and honesty of representations and

claims made by advertisements and to safe guard against misleading advertising

• To ensure that advertisement are not offensive to generally accepted standards of public decency

• To safeguard against indiscriminate use of advertising for promotion of products which are regarded as hazardous to society or to individuals to a degree or of a type which is unacceptable to society at large

• To ensure that advertisements observe fairness in competition so that the consumers need to be informed on choices in the market places and canons of generally accepted competitive behaviour in business are both served.

ASCI

• Advertising Standards Council of India is a self regulatory voluntary organization of the advertising industry.

Role & Function

• The Role and Functioning of the ASCI & its CCC (Consumer Complaints Council) in dealing with complaints received from consumers and Industry, against advertisements which are considered as:– False, Misleading, Indecent, Illegal, leading to

Unsafe practices, or Unfair to competition, and consequently in contravention of the ASCI Code for Self-Regulation in Advertising.

Comparative Advtg Law

In this backdrop, the Delhi High Court summarized the law on the subject in the case of Reckitt & Colman v. Kiwi TTK , as follows:• A tradesman is entitled to declare his goods to

be the best in the world, even though the declaration is untrue.

• He can also say that his goods are better than his competitor’s, even though such statement is untrue.

CA Law

• For the purpose of saying that his goods are the best in the world or his goods are better than his competitor’s he can even compare the advantages of his goods over the goods of others.

• He, however, cannot while saying his goods are better than his competitors', say that his competitors' goods are bad. If he says so, he really slanders the goods of his competitors. In other words he defames his competitors and their goods, which is not permissible.

CA Law

• If there is no defamation to the goods or to the manufacturer of such goods no action lies, but if there is such defamation an action lies and if an action lies for recovery of damages for defamation, then the Court is also competent to grant an order of injunction restraining repetition of such defamation.

Concept of Disparagement

• Section 36 A of the MRTP Act purports that unfair trade practices are those which lead to disparagement of the goods, services or trade of another person.

• The term “disparagement” has not been defined in any statute, but judicial pronouncements have adopted its dictionary meaning.

Concept of Disparagement

• As per The New International Webster’s' Comprehensive Dictionary, disparagement means, to speak of slightingly, undervalue, to bring discredit or dishonor upon, the act of depreciating, derogation, a condition of low estimation or valuation, a reproach, disgrace, an unjust classing or comparison with that which is of less worth, and degradation

CA Law

• In another case, the Supreme Court was of the view, that in a democratic economy, free flow of commercial information is indispensable and advertisement is a facet of “commercial speech” as public at large is benefited by the information made available through the advertisement.

• Thus, “commercial speech” is a part of Freedom of Speech and Expression guaranteed under Article 19 (1) (a) of the Indian Constitution.

CA Law

• To decide the question of disparagement of another’s goods, the manner of commercial is important.

• Unfair trade practice can be ascertained only in the presence of false or misleading facts through scientific or technical assessment of the claims. It is not actionable if the manner is only to show one’s product better or best without derogating the competitor’s product.

• Thus, Courts have taken the position that “publicity and advertisement of one’s product with a view to boosting sales is a legitimate market strategy.”

Advertising Agencies

• Sellers are responsible for claims they make about their products and services.

• Third parties - such as advertising agencies or website designers and catalog marketers - also may be liable for making or disseminating deceptive representations if they participate in the preparation or distribution of the advertising, or know about the deceptive claims.

Advertising Agencies

• Advertising agencies or website designers are responsible for reviewing the information used to substantiate ad claims.

• They may not simply rely on an advertiser's assurance that the claims are substantiated.

Surrogate Advertising is a new weapon of Proxy War.

ASCI Code

On surrogate advertising

ASCI Code

• Section 6 of the said code states: ‘Advertisements for products whose advertising is prohibited or restricted by law or by this code must not circumvent such restrictions by purporting to be advertisements for other products the advertising of which is not prohibited or restricted by law or by this code. In judging whether or not any particular advertisement is an indirect advertisement for product whose advertising is restricted or prohibited, due attention shall be paid to the following:

ASCI Code

(a) Visual content of the advertisement must depict only the product being advertised and not the prohibited or restricted product in any form or manner.

(b) The advertisement must not make any direct or indirect reference to the prohibited or restricted products.

(c) The advertisement must not create any nuances or phrases promoting prohibited products.’

Interpretation of the ASCI Code

Interpretation

It specifically prohibits surrogate advertising and lays down guidelines which qualifies it to be so, Namely:– Whether the legal product under a tobacco brand,

sought to be advertised, has been produced in reasonable quantities or not.

– Whether in the disputed advertisement, there are any direct/indirect clues to the promotion of the restricted product i.e. tobacco or not.

The Prohibition of Publication or Telecast of Vulgar, Obscene and

Surrogate Advertisements and Re-mix songs by Print and Electronic

Media Bill, 2004

Print and Electronic Media Bill, 2004

• The bill hasn’t yet seen the light of the day• For the first time, a legal definition of

‘surrogate advertisements’ has been attempted through Section 2(d), which states: ‘an advertisement which shows a substitute product in the guise of the real one which otherwise cannot be legally advertised through the print and electronic media.’

Print and Electronic Media Bill, 2004

• Section 3 prohibits the publication by print media and telecasting of surrogate advertisements and provides that violators of the said provisions shall be punished accordingly.

"Let's gear our advertising to sell goods, but let's recognize also that advertising

has a broad social responsibility."

- Leo Burnett

Advertising Law

31st March 2010, Wednesday

ASCI Code

• The Code for Self-Regulation has been – drawn up by people in professions and industries in or

connected with advertising, – in consultation with representatives of people affected by

advertising – and has been accepted by individuals, corporate bodies

and associations engaged in or otherwise concerned with the practice of advertising

– with the following as basic guidelines with a view to achieve the acceptance of fair advertising practices in the best interests of the ultimate consumer:

ASCI Code

• To ensure the truthfulness and honesty of representations and claims made by advertisements and to safeguard against misleading advertisements.

ASCI Code

• To ensure that advertisements are not offensive to generally accepted standards of public decency. Advertisements should contain nothing indecent, vulgar or repulsive which is likely, in the light of generally prevailing standards of decency and propriety, to cause grave or widespread offence.

ASCI Code

• To safeguard against the indiscriminate use of Advertising in situations or of the promotion of products which are regarded as hazardous or harmful to society or to individuals, particularly minors, to a degree or of a type which is unacceptable to society at large.

ASCI Code

• To ensure that advertisements observe fairness in competition so that the consumer’s need to be informed on choices in the market-place and the canons of generally accepted competitive behaviour in business are both served. Both the general public and an advertiser’s competitors have an equal right to expect the content of advertisements to be presented fairly, intelligibly and responsibly.

The Code applies to advertisers, advertising agencies and media.

This is a self-imposed discipline required under this Code for Self-Regulation in

Advertising…

… from all involved in the commissioning, creation, placement

or publishing of advertisements.

ASCI Code

This Code applies to advertisements read, heard or viewed in India even if they originate or are published abroad so long as they are directed to consumers in India or are exposed to significant number of consumers in India.

Trademark Infringement

• Trademark infringement can arise if a website uses registered trademarks of third parties without consent, unless the trademark is being used honestly and simply for the purpose of identification and is not bringing the mark into disrepute.

• The Trademarks Act, 1999 has introduced some wide-ranging changes to Indian trademark law

• It has essentially made it possible to apply for registration of any mark capable of graphical representation.

• This is in addition to the obvious word marks and logos, advertising straplines, slogans and shapes. Even if a mark is not registered there may still be liability for any use of a well known mark under the 1999 Act.

10 Things To Do

So your Ad comply with advertising law

• Substantiate your advertising claims• Make Sure Your Advertising Claims Aren't

‘Deceptive’.• Make Sure Your Advertising Claims Aren't ‘Unfair’.• Be Sure Your Advertising Claims Measure Up to the

"Truth and Accuracy" Standard• Make Sure Your Comparative Advertising Claims Are

Fully Substantiated and Are Not False or Deceptive

• You Should Be Familiar With the Advertising Law of the States

• Are You Aware of Advertising Law Developments on New Media as the Internet?

• Do You Advertise to Children or Will Your Advertising Reach Substantial Numbers of Children?

• What Are the Global Advertising Legal Compliance Issues Facing Your Ads?

• You've Scrutinized Your Ads for What They Expressly Claim--What About Implied Claims?

Advertising directed to children

Children as targets of Advertisements

• Children in India constitute 18.7% of the World's kids population and one-third of India's population is under 15 years of age.

• A survey by A.C.Nielsen UTV's research partner showed that an average child watches TV for about 3 hours on week days and 3.7 hours on weekends.

• About half of this time is spent watching the advertisements which can effect the behaviour of the child.

• Advertising directed to children or advertising which has been created with the participation of children shall not threaten the rights or interests of children and in its creation, regard shall be had to the perception and psyche of children.

• Exploiting the natural credulity or lack of experience of children in advertising is prohibited

• Exploiting children in alcoholic beverage and tobacco product advertising, and aiming alcoholic beverage and tobacco product advertising at children, are prohibited.

Need for Advertising Code in India

Legal actions can be taken against advertisements that:• Ridicule caste, race, nationality, colour and creed• Goes against any provision of the Indian Constitution• Incite people towards criminal activity, provocative,

cause disorder and/or violence in the country• Breach laws and/or glorify obscenity or violence in

any form• Glorify terrorism, communal massacres, criminality

and so on

• Ridicule the father of the nation, the national emblem, part of Constitution or the image of a national leader or a state dignitary

• Depict women in a deprecating manner. Females should not be portrayed in a manner that is obscene, exploitative or vulgar.

• Display distasteful visual content that goes beyond the established norms of good taste and decency.

• Exploit and encourage social evils like child marriage, bride burning and dowry system.

Current Scenario

Food & Beverage Advertisements


• The Food Safety and Standards Authority of India is working on a code that aims to stop false and misleading advertisements on food and beverages, a top official said.

• The draft rules say that advertising and communication in the food and beverages sect

• The advertisements should not encourage excessive consumption or inappropriately large portions of any particular food and not exploit consumers’ lack of experience or knowledge. or should not be misleading or deceptive.


• The code also points out that the advertisements should not undermine the role of parental care and guidance when children make food choices.

• It discourages the portrayal of products as substitutes for meals, and endorsements by government agencies, professional bodies, independent agencies or individuals in a particular profession without their prior consent.

• The food standards agency, an arm of the ministry of health and family welfare, was established under Food Safety and Standards Act, 2006, to lay down standards for food articles and regulate their manufacture, storage, distribution, sale and import.

• The 2006 Act under which the authority was constituted prescribes penalties up to Rs10 lakh for publishing misleading advertisements and selling misbranded food.

• However, it is yet to be implemented.

Code for Advertising

On All India Radio

General Rules of Conduct

• Advertising shall be designed as to confirm to the laws of the country and should not offend against morality, decency and religious susceptibilities of the people.

• No advertisements message shall in any way be presented as News

• No advertisements shall be permitted the objects whereof are wholly or mainly of a religious or political natures; advertisement must not be directed towards any religious or political end or have relation to any industrial dispute.


• No advertisement shall contain the words Guarantee or Guaranteed etc., unless the full terms of the guanrantee are available for inspection by the Directorate General, All India Radio

• Advertisers or the agents must be prepared to produce evidence to substantiate any claims or illustrations

• The items advertised shall not suffer from any defect or deficiency as mentioned in Consumer Protection Act 1986.


• No advertisement shall contain reference which are likely to lead the public to infer that the product advertised or any advertised or any of its ingredients has some special or miraculous or super-natural property or quality, which is difficult of being proved, e.g. cure for baldness, skin whitener, etc.

• Advertisements shall not contain disparaging of derogatory references to another product or service.

• Testimonials must be genuine and used in a manner not to mislead the listeners.


• Information to consumers on matters of weight, quality or prices of products where given shall be accurate.

• Advertisements indicating price comparisons or reductions must comply with relevant laws.

• Any such effects which might startle the listening public must not be incorporated in advertisements like Rapid gunfire or rifle shots, Sirens, Bombardments, Screams, Raucous laughter and the like.

General AIR Code

• Criticism of friendly countries. • Attack of religious or communities. • Anything obscene or defamatory; • Incitement to violence or anything against

maintenance of law and order; • Anything amounting to contempt of court; • Aspersions against the integrity of the President and

Judiciary; • anything affecting the integrity of the Nation and

criticism by name of any person.

Documents

Advertising Law