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Bam601 Presentation Transcript

  • 1. Advertising is the foot on theaccelerator, the hand on the throttle,the spur on the flank that keeps oureconomy surging forward” - Robert W. Sarnoff
  • 2. AdvertisingAdvertising is any paid form of non-personalpresentation and promotion of ideas, goods,or services by an identified sponsor. Intodays fast-paced, high-tech age businessesuse advertising to make prospects aware oftheir products and services and to earnprofits through increasing their sales andsales turnover. Advertising reflectscontemporary society.
  • 3. DECEPTIVE ADVERTISING•False advertising or deceptive advertising is theuse of false or misleading statements in advertising.•Deception exists when an advertisement isintroduced into the perceptual process of theaudience in such a way that the output of thatperceptual process differs from the reality of thesituation.•As advertising has the potential to persuade peopleinto commercial transactions that they mightotherwise avoid, many governments around theworld use regulations to control false, deceptive ormisleading advertising.
  • 4. WHEN IS ADVERTISING DECEPTIVE:An advertisement is called deceptive when it misleadspeople, alters the reality and affects buying behavior.According to Federal Trade Commission (USA)deception occurs when –•There is misrepresentation, omission, or a practice thatis likely to mislead.•The consumer is acting responsibly in givencircumstances•The practice is material and consumer injury ispossible because consumers are likely to have chosendifferently if there is no deception.
  • 5. DECEPTIVE ADVERTISINGThese may include the following:1. VIOLATES CONSUMERS RIGHT TO INFORMATION2. VIOLATES CONSUMERS RIGHT TO SAFETY3. VIOLATES CONSUMERS RIGHT TO CHOICE4. ADVERTISEMENTS DIRECTED AT CHILDREN5. PUFFERY6. USE OF SEX APPEALS7. BAIT ADVERTISING8. ADVERTISING OF HARMFUL PRODUCTS
  • 6. LEGAL ASPECTS OF ADVERTISINGLegal aspects of advertising can be dividedinto:• Self-regulation by the industry•Regulation by the Government
  • 7. SELF-REGULATION BY THE ADVERTISING INDUSTRYWith the increasing criticism of advertising, advertisershave devised self-regulation to ensure true and accuratemessages. A number of agencies are involved. Thesecan be classified into the following:Advertising trade associations:o Advertising Standards Council of India (ASCI)o Advertising Association of India (AAAI)o Press Council of Indiao Prasar Bharti
  • 8. Individual media and media groupso Code for commercial advertising on Doordarshano All India Radio Code for commercial advertising
  • 9. REGULATIONS BY THE GOVERNMENTThe rules, regulations and legislations include thefollowing:-Advertising Standards Council of India (ASCI)1. Constitution of India2. Consumer Protection Act, 19863. Information Technology Act, 20004. Indian Penal Code, 18605. The Young Persons (Harmful Publications) Act, 19566. Indecent Representation of Women (Prohibition) Act, 1986
  • 10. 7. The Cigarettes and other Tobacco Products (Prohibition of Advertisement and Regulation of Trade and Commerce, Production, Supply and Distribution) Act,8.The Drugs and Magic Remedies (Objectionable Advertisements) Act, 19559. The Drugs and Cosmetics Act, 194010.The Emblems and Names (Prevention of Improper Use) Act, 195011.Cable Television Networks (Regulation) Act, 199512.Securities and Exchange Board of India (SEBI) (Stock- brokers and Sub-brokers) Rules, 1992 - Code of Conduct for Stock-brokers
  • 11. 13.Securities and Exchange Board of India (SEBI) (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 199514.Securities and Exchange Board of India (SEBI) (Mutual Funds Regulation), 1996: SEBI Guidelines for Advertisements by Mutual Funds15.Securities and Exchange Board of India (SEBI) (Disclosure and Investor Protection Guidelines), 200016..The Prenatal Diagnostic Techniques (Regulation and Prevention of Misuse) Act, 199417..The Transplantation of Human Organs Act, 1994
  • 12. 18.The Representation of the People (Amendment) Act, 199619..The Monopolies and Restrictive Trade Practice act, 196920.The Lotteries (Regulation) Act, 199821.The Infant Milk Substitutes, Feeding Bottles and Infant Foods (Regulation of Production, Supply and Distribution) Act, 199222.The Competition Act, 200223.The Contract Act, 187224.The Civil Defense Act, 1968
  • 13. ADVERTISING STANDARDS COUNCIL OF INDIA (ASCI)• To scrutinize certain principles and fairness in the sphere of advertising, Advertising Standards Council of India was established in India in 1985. ASCI deal with complaints received from consumers and industry against such advertisements which are false, misleading, indecent, illegal, leading to unsafe practices or unfair to competition and are in contravention to the advertising code. Even though there is no as such provision for regulating advertisement policy in the Constitution of India, which should be adopted by press or media, the Supreme Court has given guidelines for the same through a series of decisions.
  • 14. CONSUMER PROTECTION ACT, 1986Consumer Protection Act, 1986 provides better protection of theinterests of consumers and to make provision for the establishment ofconsumer councils and other authorities for the settlement ofconsum-ers disputes and for matters connected to it, includingprotection against unfair trade practices.
  • 15. INFORMATION TECHNOLOGY ACT, 2000• India is one of the very few countries in the world besides Singapore to have legislated Cyber laws. The IT Act specifically empowers that anyone who publishes in the electronic form, any material which is lascivious or which tends to degrade persons who are likely to read, see or hear the matter contained or embodied in it, shall be punishable with imprisonment and fine. Even there is a provision in the IT Act, which applies to any offence by which any person shall be punished irrespective of his/her nationality if the act constituting the offence involves a computer, computer system or computer network located in India.
  • 16. INDIAN PENAL CODE, 1860• As per the provisions of Indian Penal Code, 1860 certain advertisements are considered as criminal offences. It is dealt under different provisions of the Code.
  • 17. THE YOUNG PERSONS (HARMFUL PUBLICATIONS) ACT, 1956• The Young Persons (Harmful Publications) Act, 1956 prevents the dissemination of certain publications harmful to young persons. To be more précised harmful publication indicates such publications which would tend to corrupt a young person whether by inciting or encouraging him to commit offences. The Act also proclaims that whoever advertises or makes known by any means that any harmful publication can be procured from or through any person, and then he shall be punished with imprisonment or with fine, or with both.
  • 18. INDECENT REPRESENTATIONOF WOMEN (PROHIBITION) ACT, 1986• Indecent Representation of Women (Prohibition) Act, 1986 prohibits indecent representation of women through advertisements or in publications, writings, paintings, figures or in any other manner and for matters connected therewith or incidental thereto.
  • 19. THE CIGARETTES AND OTHERTOBACCO PRODUCTS (PROHIBITION OF ADVERTISEMENT AND REGULATION OF TRADE ANDCOMMERCE, PRODUCTION, SUPPLYAND DISTRIBUTION) ACT, 2003 AND THE CIGARETTES (REGULATION OF PRODUCTION, SUPPLY AND DISTRIBUTION) ACT, 1975
  • 20. The Cigarettes and other Tobacco Products (Prohibitionof Advertisement and Regulation of Trade andCommerce, Production, Supply and Distribution) Act,2003 and the Cigarettes (Regulation of Production,Supply and Distribution) Act, 1975, states that noperson shall advertise for the distribution, sale or supplyof cigarettes, and also shall not take part in thepublication of such advertisement, unless the specifiedwarning is included in such advertisement.
  • 21. THE DRUGS AND MAGIC REMEDIES (OBJECTIONABLE ADVERTISEMENTS) ACT, 1954• The Drugs and Magic Remedies (Objectionable Advertisements) Act, 1954 (DMRA) controls the advertisement of such drugs which is said to provide magical remedies and to deal with other matters relating to it.
  • 22. THE DRUGS AND COSMETICS ACT, 1940• As per the Drugs and Cosmetics Act, 1940 (DCA), no person shall himself or by any other person on his behalf offer for sale any drug or cosmetic which is not of a standard quality, or is misbranded, adulterated or spurious. The Act gives similar restrictions to advertisements for traditional drugs such as Ayurvedic, Siddha and Unani. The Emblems and Names (Prevention of Improper Use) Act, 1950 is enacted to prevent the improper use of certain emblems and names, for professional and commercial purposes.
  • 23. CABLE TELEVISION NETWORKS (REGULATION) ACT, 1995• This law lays down the procedure for registration of a cable television network and also regulates the programmes and advertisements transmitted on cable network in India. The registering authority is the Head Post Master of a Head Post Office of the area within whose territorial jurisdiction the office of the cable operator is situated.
  • 24. SECURITIES AND EXCHANGE BOARD OF INDIA (SEBI)• In the exercise of the powers conferred by section 30 of the Securities and Exchange Board of India (SEBI) Act, 1992, the Board makes the regulations on the code of conduct for Stock-brokers to be known as SEBI Stock-brokers and Sub-brokers Rules in 1992. The provisions of the Rules specified that a stock- broker or sub-broker is prohibited from advertising his business publicly unless permitted by the stock exchange, including in their internet sites, by its subsidiaries, group companies etc.
  • 25. THE PRENATAL DIAGNOSTIC TECHNIQUES (REGULATIONAND PREVENTION OF MISUSE) ACT, 1994• The Prenatal Diagnostic Techniques (Regulation and Prevention of Misuse) Act, 1994, contains provision which prohibits advertisements relating to predetermination of sex. The Act provides for the prohibition of advertisements of any kind for anybody or person pertaining to facilities for pre- natal diagnosis of sex available at any center or place.
  • 26. THE TRANSPLANTATION OF HUMAN ORGANS ACT, 1994• The Transplantation of Human Organs Act, 1994 provides for the regulation of removal, storage and transplantation of human organs for therapeutic purposes and for the prevention of commercial dealings in human organs and for matters relating to it and provisions are there for the punishment for commercial dealings in human organs.
  • 27. THE REPRESENTATION OF THE PEOPLE (AMENDMENT) ACT, 1951• While detailing the provisions of the Representation of the People (Amendment) Act, 1951 (RPA), the statute even provides penalty for anyone including the advertisers who contravene the above provision with imprisonment or fine or with both.
  • 28. THE LOTTERIES (REGULATION) ACT, 1998• The Lotteries (Regulation) Act, 1998, it is seen that a State Government has the discretionary powers to organize, conduct or promote a lottery, including advertising thereof subject to some conditions specified in the Statute. It is also provided that the State Government may prohibit within itself the sale of tickets of a lottery organized, conducted or promoted by every other state;
  • 29. THE INFANT MILK SUBSTITUTES, FEEDING BOTTLES AND INFANT FOODS(REGULATION OF PRODUCTION, SUPPLY AND DISTRIBUTION) ACT, 1992
  • 30. The Infant Milk Substitutes, Feeding Bottles andInfant Foods (Regulation of Production, Supply andDistribution) Act, 1992 Amended in 2003 regulatesthe production, supply and distribution of infant milksubstitutes, feeding bottles and infant foods with aview for protecting and promoting breastfeedingand for the matters relating to it includingadvertisement of the same.
  • 31. THE CONTRACT ACT, 1872• As per the Contract Act, 1872, the advertisements for gambling, lottery and prize games have held to be wagering contracts and thus void and unenforceable, and are prohibited in India. While reading the provisions of the Act along with the ASCI guidelines it is understood that even the incorporation of a visual representation of such gaming room or table could be construed as indirect advertisement.
  • 32. THE EMBLEMS AND NAMES (PREVENTION OF IMPROPER USE) ACT, 1950• This Act prohibits the use by any private party of certain names, emblems, etc.
  • 33. MOTOR VEHICLES ACT, 1988• This law affects outdoor advertisements, like bill boards, posters, neon signs, etc. The Act, grants powers to remove such advertisements which may distract drivers and have the potential of causing road accidents.
  • 34. THE MONOPOLIES AND RESTRICTIVE TRADE PRACTICE ACT, 1969• It had been the most effective Act in the eighties and nineties to regulate undesirable advertising. In the year 1984, the government brought, through an amendment, "unfair trade practices" under the purview of the MRTP Commission and the Office of the Director General (Investigation and Registration). However, this Act is being replaced by the Competition Act, 2002 but the cases pending under the MRTP Commission are still being heard. Moreover, a Competition Commission has been set up under the Competition Act to deal with monopolies and restrictive trade practices.
  • 35. REMEDIES TO DECEPTIVE ADVERTISING• CEASE –AND – DESIST ORDERS The cease –and –desist order, which prohibits the respondent from engaging further in the deceptive practice, It has been criticized as being a command to “go and sin no more”, which has little practical effect. By the time the cease- and-desist order is issued, the advertising may have served its purpose and another campaign may be underway anyway.
  • 36. • RESTITUTIONRestitution means that the consumer is compensated for any damage. Restitution is rarely considered because of its severity.• AFFIRMATIVE DISCLOSURESIf an advertisement has provided insufficient information to the consumer, an affirmative disclosure might be issued. Affirmative disclosures require “clear and conspicuous” disclosure of the omitted information. Often the involved information relates to deficiencies or limitations of the product or service relating to matters of health or safety.
  • 37. • CORRECTIVE ADVERTISING Corrective advertising required advertisers to rectify past deception by making suitable statements in future commercials. Some important issues could need research on the subject. Any remedy should be no punitive in nature and should not be burdensome. One problem with corrective advertising is that it has usually resulted in lawyers writing copy and insisting that it be run some arbitrary length of time.
  • 38.  The implementation of the communication objective approach to corrective advertising will always face difficulties. The problem of ascertaining how misperception and its effect are to be measured and the appropriate target level of misperception that should be obtained reappears in this context. Judgments on such questions are required to set communication objectives. Another problem is the cost of measuring deception over time. The tracking required measuring the impact of the commercials- no problem for large advertisers, who do that anyway – could be costly for smaller advertisers and may require the government to share some of the costs.
  • 39.  Corrective advertising has only rarely been considered, largely because of the difficulties in deciding on the target objective. However, it remains an important option and serves to focus attention on the central issues in deception cases.
  • 40. CONCLUSIONUnfortunately despite several laws meant to protect consumers against such unfair trade practices, false and misleading advertisements continue to exploit the consumer. Outdated laws, poor enforcement of them are some of the lacunas in order to control advertising. The need of the hour is better laws in keeping with the times, better enforcement, corrective advertisements, better self-regulation by industry independent regulator to regulate health and children -related advertisements.
  • 41. Several consumers and consumer organizations such as, Consumer Voice are fighting against the misleading advertisements. Magazines such as, Consumer Voice, Insight publishes advertisements running a column on misleading advertisements. They also request consumers to share their opinions regarding various advertisements so that any advertisement which is deceptive and false can be brought to the notice of the regulators. The brighter side of all this is that as consumer awareness grows, marketers and advertisers are fast learning that in these days when the consumer is king, nothing but the best would do. As JWT agency quotes, "Advertising is a non-moral force, like electricity, which not only illuminates but electrocutes. It’s worth to civilization depends upon how it is used."