Legal & Ethical Aspects of Advertising
Advertisements are the most common marketing method used
by businesses. Ads last longer than word of mouth or networking, and ads have a
greater potential to reach a large number of people, especially in the digital
age. Because the public is bombarded by advertising on a daily basis, ads are
subject to many regulations. When advertising, you should keep legal and
ethical considerations in mind.
The advertising industry operates within strict federal
regulations and is monitored by the Federal Trade Commission. Even with
truth-in-advertising laws in place, advertisers have significant leeway to
violate the ethical standards of a wide range of consumers. Advertisers have to
be especially careful to act ethically at all times, taking extra care when
advertising to children, advertising potentially harmful products and using
psychological tactics to stimulate demand. Having a list of ethical and legal
issues at hand when creating advertisements can help you to craft legal,
responsible ad messages.
Truth in Advertising
The Federal Trade Commission Act set forth requirements
for truth in advertising and created the FTC to enforce the provisions of the
act. The Bureau of Consumer Protection's Business Bureau notes that
advertisements in the U.S. must by truthful, not deceptive and not unfair.
Advertisers must also have evidence available to back up claims they make.
The FTC defines deceitful statements as those that
are likely to mislead consumers who act reasonably under normal circumstances
and that are likely to affect consumers' purchase decisions. The FTC defines
unfair advertisements as those that are likely to cause substantial,
unavoidable injury when using a product, unless the injury is outweighed by the
provable benefits.
Statutory Provisions Governing Advertising
Laws governing advertisements in India
Introduction
to Advertisements
Advertisements
are the method of promoting the sale, generally used to promote marketing
strategically. One should not get confused between advertisement and
propaganda; propaganda is what the governments use to promote their policies.
Advertisement can be done by both printed and digital methods. Television,
radio, newspaper, internet all can be used for the purpose of advertisement.
According to a survey, an average of 600 US billion dollars is used worldwide
in advertisements.
Human
civilization has seen a different form of advertisements right from the ancient
period. Wall paintings, announcements, campaign displays were the form of
advertisement during the ancient times. These methods are however even now
being used in some parts of Asia. With modernization, new methods of
advertisements have been introduced. However, several issues of misuse of
advertisements have been observed, and this has forced the governments all
around the world to enforce strict laws to keep a check upon misuse of
advertisements.
Advertising laws in India
In
the previous few years, advertisement in India has seen the vast
transformation. From the Doordarshan and Prasar Bharti way of
advertising to the modern television channel and media, however with increasing
misuse such as promoting a prohibited medicine, promotion of alcohol, promotion
of toxic substance such as cigarette tobacco, etc. forced the government to
pass several laws to keep in check such sought of advertisements. The several
legislations that are responsible for controlling misleading advertisements:
Press Council of India Act, 1978
Cable television regulation act, 1955 and Cable
television amendment act, 2006
Establishment of the ASCI (Advertisement standard
council of India), 1985
The
Advertising Standard Council of India was established as a non-statutory
tribunal. It created a self-regulated mechanism of introducing the advertising
ethics in India. The ASCI judge the advertisements based upon its Code of
Advertising Practice, also known as the 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 a significant number of consumers in India.
Survey of FICCI (Federation of Indian Chambers of Commerce &
Industries) regarding functioning of self-regulation in advertising
To
understand whether the ASCI is functioning properly or whether the guidelines
of ASCI are sufficient enough to check the misleading advertisements, FICCI
sent a questionnaire to all the top-tier official advertising managements. To
mention a few, the questionnaire was sent to:
Advertising
agencies
Advertisers
BTL
agencies
Government
Market
research
Marketing
Institutes
Media
The findings of the survey on self-regulation of advertising
According
to the survey, it was found out that among the sectors as mentioned above, 31%
believed that the ASCI framework is ok and enough to act and check upon the
advertisements. They believed that very limited instances where the ASCI had
failed to perform adequately. 13% believed that the ASCI framework is adequate
but needs some reforms so as to be more effective. While shockingly a 56%
believed the framework to be inadequate and ineffective. They said that there
is not enough knowledge among the stakeholders regarding the regulatory
mechanism and process of complaint making. They also indicated that there are
ads which making false claims, and there is no medical research to substantiate
the claim. The message is not conveyed in the right spirit, and the present
framework is not addressing this.
Laws and acts governing advertisement
In
India several laws and acts related to advertisement control. Let’s
mention a few of them.
The consumer protection Act, 1986 and
advertising
The Section
6 of this Act grants consumers the right to be informed about the
quality, quantity, potency, purity, standard and price of goods or
services, as the case may be to protect the consumer against
unfair trade practices. Section 2(r) of the Act, under the
definition the term “unfair trade practice”, it also covers the gamut of
false advertisements including misrepresentations or false allurements. And to
redress against such unfair trade practices on false
advertisements may be sought under the Act.
The cable
television network Act, 1995& the Cable Television Amendment Act, 2006 and advertising
Section
6 of the Cable Television Networks (Regulations) Act, 1995 provides that no
person shall send or transmit through a cable service any advertisement unless
such advertisement is in conformity with the advertisement code prescribed under
the Cable Television Networks (Amendment) Rules, 2006. However, the provision
above does not apply to programs of foreign satellite channels which can be
received without the use of any specialized gadgets or decoder.
Also
the Rule 7 of the Cable Television Networks (Amendment) Rules, 2006 lays
down the “Advertising Code” for cable services which have been
formulated to conform to the laws of the country and
to ensure that advertisements do not offend morality, decency and
religious susceptibilities of the subscribers.
Restrictions on advertising under the
Cigarettes and other Tobacco Products (Prohibition of Advertisement and
Regulation of Trade and Commerce, Production, Supply, and Distribution) Act,
2003
Section
5 of this Act, prohibits both direct & indirect advertisement of tobacco
products in all forms of audio, visual and print media.
Advertising regulations under Drug and
Magic Remedies Act, 1954 & Drugs and Cosmetics Act, 1940
This
Act is for regulating the advertisements of drugs in certain cases and to
prohibit the advertising for certain purposes of remedies alleged to have magic
qualities and to give for matters connected therewith; – Section 29 of the
Drugs and Cosmetics Act,1940 imposes a penalty upon whoever uses any report of
a test or analysis made by the Central Drugs Laboratory or by a Government
Analyst, or any extract from such report, for the purpose of advertising any
drug. The punishment prescribed for such an offense is fine which may extend up
to five hundred rupees and imprisonment up to ten years upon subsequent
conviction.
Advertising restrictions under Prenatal Diagnostic Techniques (Regulation and Prevention of Misuse) Act, 1994 & Young Persons (Harmful Publications) Act, 1956
Advertisement
in any manner regarding facilities of pre-natal determination of sex available
at any genetic counselling center, laboratory, clinic or any other place is
prohibited under this Act and has been made a punishable offence under the Act
(Section 22); – Section 3 of the young person harmful Publication Act,1956,
inter alia, imposes penalty for advertising or making known by any means
whatsoever that any harmful publication (as defined in the Act) can be procured
from or through any person.
The Indian
Penal Code and criminality of advertisements:
The
IPC, vide an array of provisions, prohibits obscene, defamatory publication,
publication of a lottery and statements creating or promoting disharmony/
enmity in the society. While it is not implicitly written, any advertisement
that related to an offence, like hiring a contract killer or inciting violence,
terrorism or a crime is illegal and will be punished under IPC or other
applicable provisions.
Summary of advertisement laws in India
As
a summary of the advertisement acts in India, it can be virtually said that
various laws about advertisement in general and those relating to specific
sectors and malpractices have created a sense of fear in minds of those who use
wrong methods of advertising unethical materials. However, the absence of a
single statutory, regulatory body further aggravates the problem. A
comprehensive law/ regulation on advertising in all forms of media which shall
provide clarity in the matter and act as a one-stop window for all matters
relating to advertising is highly desirable. The advertising sector needs to be
ethical, which means they should not be advertising just for the sake of profit
motives rather it must follow some ethics. Public advertisements of alcohol,
cigarette and other health-harming products, unnatural medicines, etc. should
be avoided.
The
advertisement makers must follow the following ethical values:
Should
be true.
Must
not be illegal.
Must
not misguide the society, especially children.
It
must be however the duty of the related authorities to offer a safeguard
against the violators. The aim of such bodies must be as follows:
1. To
provide a safeguard against the indiscriminate use of advertising for the
promotion of products which are regarded as hazardous to society or people to a
degree or of a type that is not acceptable for the society at large.
2. To
ensure that advertisements observe fairness in the competition so that the
consumer’s need to be informed of choices in the marketplace and the canons of
generally accepted competitive behavior in business is both served.
3. No
advertisement shall be permitted that derides any race, caste, nationality.
Also, such advertisements must be avoided which is against the constitution of
India, presents criminality as desirable, exploits national emblem or security.
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