Introduction

India’s economic growth and expanding consumer base have led to massive growth of the Indian advertising industry. According to the IPG Mediabrands’ Magna Global Advertising Forecast 2024, India’s advertising industry is on an upward trend and is projected to rise to INR1.2 trillion (USD14.6 billion) in 2024 with a forecast of becoming become one of the top ten advertising markets in 2025. Further, as per the Digital Advertising Report 2024, published by Dentsu India and exchange4media, the Indian digital advertising industry has seen magnificent growth and is expected to grow at a compounded rate of 23.49% by 2025. Globalistion, digitalisation and dynamic forms of advertising like programmatic advertising, targeted online ads, mobile-first ads, omnichannel ads, influencer marketing, etc, have steered effective, personalised and immersive ads for consumers. Such advertising depth and range has its own share of issues like misleading advertisements, concealment of information, spam, dark patterns, surrogate advertisements, etc, that regulators have needed to tackle in recent years.

This article traces the recent and upcoming legal developments and trends in advertising and marketing in India as well as their impact on the relevant sectors.

Recent Developments in the Legal Framework

The Consumer Protection Act, 2019 (CPA) is the primary legislation for ensuring consumer protection, and among other things, also regulates (misleading) advertisements and unfair trade practice. The CPA defines the term “advertisement” widely to mean any audio or visual publicity, representation, endorsement or pronouncement made on any medium including light, smoke, gas, electronic, internet, etc. Under the CPA, the Central Consumer Protection Authority (CCPA) is the central authority established for issuing guidelines and regulating matters relating to inter alia protection of consumer interest and preventing unfair trade practice and false and misleading advertisements. The CCPA in recent years has been issuing guidelines not only to govern misleading advertisements generally but also to regulate various new and emerging aspects of advertising and marketing to protect consumers from misleading and deceptive practices. The guidelines and updates recently issued by the CCPA are listed below.

Guidelines for the Prevention and Regulation of Greenwashing or Misleading Environmental Claims, 2024 (the “Greenwashing Guidelines”)

Recently, India has witnessed a surge in advertisements making green claims that are ostensibly misleading. This prompted the CCPA to constitute a committee of stakeholders, comprised of persons from universities, law firms, government voluntary consumer organisations and industry associations, for consultation on “greenwashing”. In furtherance of these meetings, and the draft Guidelines circulated in February 2024 for stakeholder comments, the CCPA on 15 October 2024 issued the Greenwashing Guidelines.

The Greenwashing Guidelines prohibit any person from engaging in greenwashing and misleading environmental claims. The term greenwashing has been defined to mean any deceptive/misleading practice such as concealing, omitting, or hiding relevant information exaggerating, making vague, false, or unsubstantiated “environmental claims” or use of misleading words, symbols, etc, placing emphasis on positive environmental aspects while downplaying or concealing harmful attributes. This, however, would not include obvious hyperbole or puffery, the use of generic colour schemes/pictures that are not deceptive/misleading, or a company mission statement that is not specific to a product/service. The Greenwashing Guidelines provide a wide definition of the term environmental claims to mean “any representation in any form” regarding inter alia, a good or service, any component/portion thereof, any process involved in manufacturing, packing, use or disposal of the good or generally providing a service that implies environmentally friendly attributes.

These guidelines apply to all environmental claims and to any manufacturer, service provider/trader, advertising agency or endorser. 

The Greenwashing Guidelines require that an environmental claim should be substantiated by accessible verifiable evidence based on independent studies or third-party certifications and provide guidance on the manner of making disclosures about the environmental claims.

The Greenwashing Guidelines have been drafted to address concerns regarding advertisements of environment-friendly products and considering the growing number of environmentally aware consumers.

Guidelines for Prevention and Regulation of Dark Patterns, 2023 (the “Dark Pattern Guidelines”)

In November 2023, the CCPA issued the Dark Pattern Guidelines to prevent and regulate dark patterns. These guidelines apply to all platforms that systematically offer goods and services in India, sellers and advertisers and prohibit engaging in any practice/deceptive design patterns in user interfaces or experiences on any platform that is designed to mislead or trick users. A person/platform is presumed to be engaging in dark pattern practice if it engages in any of the 13 practices identified in Annexure I of these guidelines including but not limited to subscription trap, bait and switch, drip pricing, SaaS billing, etc. The Dark Pattern Guidelines provide definitions as well as illustrations explaining these terms. 

While the Dark Pattern Guidelines do not per se mention the consequences of non-compliance with the guidelines, as per a written response provided in December 2023 by the Union Minister of State for Consumer Affairs, Food and Public in the Upper House of the Indian Parliament, dark pattern practices would be considered unfair trade practice under the CPA. Since the CCPA is responsible for preventing unfair trade practices and ensuring that no one engages in unfair trade practices as per the CPA, it can inquire into unfair trade practices either on its own accord, on a complaint or the directions of the central government and, upon finding evidence, it can issue orders for the recall of goods/services, refund of the purchase price, and cessation of unfair practices, as deemed necessary. A similar action can also be taken by the consumer forum if a complaint is filed before it.

These guidelines are further complemented by the Guidelines for Online Deceptive Design Patterns in Advertising (“ASCI Dark Pattern Guidelines”) issued by the self-regulatory body, Advertising Standards Council of India (ASCI), to ensure compliance with ASCI’s Code of Self-Regulation (the “ASCI Code”) which requires advertisements to be honest and truthful and not misleading. Unlike the Dark Pattern Guidelines issued under the CPA, the ASCI Dark Pattern Guidelines only identify four deceptive design patterns, namely drip pricing, bait and switch, false urgency and disguised advertisements. The definitions of these terms, however, are similar in both these guidelines.

The ASCI and the ASCI Code, including its guidelines, have wide acceptance in India among industries, advertisers, advertising agencies, media and PR agencies. In fact, the ASCI Code has been recognised in Indian law. For instance, the Cable Television Network Rules 1994 prescribe the ASCI Code as part of the Advertising Code stipulated in these rules. Moreover, the Supreme Court has also acknowledged ASCI’s role in self-regulation of advertisements in India.

In addition to the statutory recourse provided under the CPA, consumers can also file their complaints with ASCI. The complaints are investigated and examined by the Consumer Complaints Council (CCC) of the ASCI which functions as a formal examining body that analyses advertisements to ensure compliance with the ASCI Code and the guidelines issued by the ASCI from time to time. Non-compliance with the orders of the CCC can lead to escalation to the relevant authority or ministry for further action.

Additional Influencer Guidelines for Health and Wellness Celebrities, Influencers and Virtual Influencers (the “Additional Influencer Guidelines”)

As an extension to the CCPA issued “Guidelines for Prevention of Misleading Advertisements and Endorsements for Misleading Advertisements, 2022” (the “Misleading Ads Guidelines”), Additional Influencer Guidelines have been issued to specifically deal with the issues of “misleading advertisements, unsubstantiated claims and ensure transparency in health and wellness endorsements”.

The Misleading Ads Guidelines are applicable to all advertisements in any form, format or medium and apply to a manufacturer, service provider, trader, advertising agency, and an endorser whose service is availed for advertising a product/service. Accordingly, by extension, the Additional Influencer Guidelines are also applicable to all forms, formats and mediums of advertisements. 

The Misleading Ads Guidelines stipulate the manner of displaying disclaimers in advertisements and require disclosure of any connection between the endorser and the trader, manufacturer or advertiser of the endorsed product, if such endorsement is not reasonably expected and if it can materially affect the value or the credibility of the endorsement. In furtherance of these requirements, the Additional Influencer Guidelines require, inter alia, celebrities, influencers and virtual influencers presenting themselves as health experts or medical practitioners to provide appropriate disclaimers. Further, it requires certified medical practitioners and health and fitness experts to disclose that they are certified.

Endorsers, celebrities, influencers and virtual influencers are required to ensure that the information disseminated by them is substantiated by facts and is not being perceived by consumers as a substitute for professional medical advice. Rather, endorsers should encourage their audience to seek professional health and wellness advice before significantly altering their routines.

The Additional Influencer Guidelines are not applicable to celebrities, influencers and virtual influencers who provide general wellness and health advice that is not associated with specific products/service or not targeting specific health conditions.

Alongside the Additional Influencer Guidelines, ASCI has issued the Guidelines for Influencer Advertising in Digital Media (the “ASCI Influencer Guidelines”) to address the concerns regarding blurred boundaries between content and paid promotions in digital advertising which potentially compromised the consumer autonomy. To address this issue, the ASCI Influencer Guidelines require disclosure of any material connection between an advertiser and the influencer, including but not limited to monetary or other compensation, discounts, gifts, hotel stays, awards, etc. Unlike the Additional Influencer Guidelines which stipulate obligations for “health and wellness” celebrities, influencers and virtual influencers, the ASCI Influencer Guidelines apply to all influencers and virtual influencers. The ASCI has issued separate guidelines for celebrities in advertising.

Nevertheless, celebrities and influencers who are not governed under the Additional Influencer Guidelines can still be held accountable by the CCPA under the Misleading Ads Guidelines read with the CPA. This is corroborated by the advisory issued by the CCPA in March 2024 in respect of surrogate advertisements and endorsement of betting and gambling activities by celebrities and influencers. As per the advisory, such endorsements by celebrities and influencers lead consumers to believe that betting and gambling activities are acceptable. In fact, the Misleading Ads Guidelines prohibit advertisements of goods and services that are prohibited in other laws. After the advisory issued by the CCPA, the Ministry of Information and Broadcasting (MIB) also issued a similar advisory in respect of “online advertisements” to intermediaries and social media platforms asking them to remove access to any advertisement and branded content of offshore online betting and gambling platforms to retain their safe harbour protection under the Information Technology Act, 2000. The MIB strongly advised endorsers and influencers on social media platforms to refrain from promoting offshore online betting and gambling platforms. 

Sector-Specific Regulations

In addition to the CPA, there are sector-specific laws and regulations for advertisements and marketing of the products and services of that sector. For instance, advertisements and claims pertaining to food products are regulated under the Food Safety and Standards Act, 2006, read with the Food Safety and Standards (Advertising and Claims) Regulations, 2018. Similarly, the Drugs and Magical Remedies (Objectionable Advertisements) Act, 1954 prohibits the publication of misleading advertisement of drugs. The Cable Television Networks (Regulation) Act, 1995 (the “CTN Act”) regulates inter alia advertisements over cable services and cable television networks and prescribes an advertisement code. Similarly, the Cigarettes and other Tobacco Products (Prohibition of Advertisement and Regulation of Trade and Commerce, Production, Supply and Distribution) Rules, 2004 (the “COTP Rules”) govern advertisements of cigarettes and other tobacco products on various mediums and platforms.

Given the above context, various ministries and government departments have made efforts to provide sector-specific rules and guidelines pertaining to advertisements from time to time.

In 2023, the Ministry of Health and Family Welfare amended the COTP Rules and introduced a provision requiring the publisher of online curated content (which means any content other than news and current affairs made available or transmitted over internet or computer networks) to display anti-tobacco health spots at the beginning and middle of a programme, an anti-tobacco health warning as a static message at the bottom of the screen while displaying the tobacco product or its use, and an audio-visual disclaimer on the ill-effects of using tobacco in the beginning and middle of the programme.

Recently, the Department of Pharmaceuticals (DoP), under the Ministry of Chemicals and Fertilisers, issued the Uniform Code For Pharmaceuticals Marketing Practices 2024 (UCPMP) and Uniform Code For Marketing Practices in Medical Devices 2024 (UCMPMD). These codes are applicable to the promotion and marketing undertaken by pharmaceutical companies and medical device companies respectively and provide guidance on the claims for usefulness of drugs and medical devices. As per the codes, any claims and comparisons must be capable of substantiation. Further, while comparing drugs or medical devices, brand names of the products of other companies should not be used without seeking prior consent, and in any case their products should not be directly or indirectly disparaged.

Additionally, the UCPMP and the UCMPMD require all pharmaceutical associations and all medical devices associations respectively to constitute an ethics committee for marketing practices. Further, the UCPMP requires the pharmaceutical associations to upload the UCPMP on their websites, along with a detailed procedure for lodging complaints for violation of its provisions and link the same to the UCPMP portal of the DoP. A similar obligation has also been provided for all Indian medical device associations in the UCMPMD.

Court Decisions

In addition to the legislation, regulations and guidelines, advertisements in India are also subject to precedents set through court orders and judgments. A recent example of this is the order of the Supreme Court of India in the ongoing case of Indian Medical Association & Another v Union of India. On 7 May 2024, the Supreme Court of India issued a directive in its order in the foregoing case requiring advertisers or advertising agencies to submit a self-declaration of compliance on a dedicated portal of the MIB before printing/airing/display of an advertisement. By way of background, the order was passed in a case that was filed against the Patanjali conglomerate in respect of misleading advertisements claiming that their products could cure diseases. The order was issued under Article 32 (Supreme Court’s power to enforce fundamental rights) and Article 141 of the Constitution of India making it a law declared by the Supreme Court that would be binding on all courts.

Pursuant to the Supreme Court order, the MIB issued an advisory on 3 June 2024, to private satellite TV channels, newspapers, publishers of news and current affairs content on digital media and publishers of online curated content – ie, OTT platforms, prescribing the manner in which a self-declaration certificate (SDC) could be uploaded on the government portal for any advertisement published on or after 18 June 2024, attesting that the advertisement does not make misleading claims and complies with the applicable regulatory guidelines, including but not limited to the CTN Act. Thereafter, the MIB issued another advisory extending the mandate to radio stations. The MIB had also issued guidelines for uploading these SDCs on their portals, which required advertisers and advertising agencies to provide additional documents and information such as a description of the advertisement, full script of advertisements, video/audio file, etc. 

The circulars issued by the MIB went beyond the mandate of the Supreme Court by requiring advertisers/advertising agencies to follow a rigorous process of submitting SDCs along with additional information and documents that were not mandated by the Supreme Court. After representations from various stakeholders that highlighted the issues with the overarching nature of the mandate and the comprehensive requirements of the mechanism introduced by the MIB, the MIB issued its third advisory, superseding the previous advisories, and limiting the scope of the mandate requiring submission of SDCs to advertisements for products and services related to food and health sectors. This case is pending before the Supreme Court as of October 2024. Although the MIB portals appear to be functional, there is no clarity regarding the applicability and enforcement of the order pertaining to the submission of SDCs.

Upcoming Laws and Proposed Guidelines

In addition to the above, steps are being taken to regulate specific aspects and sectors of advertisements in India. Some of these developments are mentioned below.

Digital Personal Data Protection Act, 2023 (the “DPDP Act”)

India’s first comprehensive data protection legislation, the DPDP Act, received the President’s assent in August 2023 to become law. While it has been introduced, the DPDP Act has not yet come into force. While the DPDP Act governs digital personal data rather than advertisements, it does prohibit targeted advertising directed at children (unless exempted by the central government through delegated legislation). This prohibition under the DPDP Act overlaps with the Misleading Ads Guidelines as the Misleading Ads Guidelines do not prohibit children-targeted advertisements and instead regulate the manner in which such advertisements can be made or displayed. Accordingly, this overlap will have to be clarified for effectively addressing the issue of targeted advertisements directed at children.

Draft Guidelines for the Prevention and Regulation of Unsolicited and Unwarranted Business Communication, 2024 (the “Draft UUBC Guidelines”)

In June 2024, the CCPA sought public comments on the Draft UUBC Guidelines to prevent unfair trade practices and violation of consumer rights due to unsolicited and unwarranted business communication. The draft guidelines define “business communication” as any communication related to goods and services that may be made in the form of voice calls, SMS and instant messaging, including through social media platforms excluding personal communication. 

If adopted and introduced in their current form, the Draft UUBC Guidelines would be applicable to all persons and establishments that make or cause to make the business communication (Maker), engage the Maker of such communication, are the intended beneficiaries from such communication, and in whose name such communication is made by the Maker.

These draft guidelines also provide conditions for making business communication, including using a number series prescribed by the Telecom Regulatory Authority of India or the Department of Telecommunications, complying with an opt-out request/communication of a consumer, obtaining explicit and specific consent in digital form, including through the Digital Consent Acquisition (DCA) facility of telecom service providers, clearly identifying the calling entity and purpose of the call, etc. Additionally, such business communication should only be made in compliance with the Telecom Commercial Communications Customer Preference Regulations 2018, and the Directions issued thereunder.

Any communication initiated in non-compliance of these conditions would be considered as a violation of the Draft UUBC Guidelines and consequently the provisions of the CPA.

Draft Guidelines for Prevention of Misleading Advertisement in Coaching, 2024 (the “Draft Coaching Ads Guidelines”)

The CCPA has also released the Draft Coaching Ads Guidelines for preventing misleading advertisements in coaching which is defined as “tuition, instructions or academic support or learning programme or guidance provided by any person”.

As per these draft guidelines, a person engaging in inter alia concealment of important information such as name and duration of the course chosen by a successful candidate, making false claims regarding success rates, rankings in a competitive exam without verifiable evidence, falsely creating a sense of urgency or any other practice that would mislead consumers or subvert their autonomy would be considered to be engaging in misleading advertisement. The Draft Coaching Ads Guidelines also stipulate the obligations of a person engaged in coaching.

While the Draft Coaching Ads Guidelines have not yet been finalised and adopted, the CCPA has already started enforcement actions against coaching centres for misleading advertisements. In September 2024, the CCPA issued an order against Shankar IAS Academy for the publication of misleading advertisements in respect of the Civil Service Exam 2022, conducted by the Union Public Service Commission. Further, as per a press release issued by the Ministry of Consumer Affairs, the CCPA has issued notices to various coaching institutes for allegedly engaging in misleading advertisements.

Conclusion

The recent legislative and regulatory trends and developments in the advertising and marketing space highlight the heightened focus of the government, regulatory authorities, self-regulatory bodies and the industry on curbing misleading advertisements and prioritising consumer protection and ethical advertising. This is also corroborated by the Supreme Court’s order requiring increased accountability from advertisers and advertising agencies.

Moreover, given the aligned interests of the CCPA and the ASCI and their common goal of protecting consumer interests, the CCPA has requested ASCI to escalate any advertisement that is non-compliant with the ASCI Code (and the guidelines) which could potentially violate the CPA or any of its guidelines to CCPA for appropriate action.

These developments would play a pivotal role in promoting responsible and transparent advertising in India.