Advertising

Regulation

What rules govern advertising on the internet?

While there are no specific rules or regulations governing advertising on the internet, in terms of the IT Act, it should be ensured that any advertisement published or transmitted through any website on the internet does not contain any obscene material, any material containing sexually explicit acts or conduct, and any material depicting children in an obscene, indecent or sexually explicit manner. In addition to the above, the Advertising Standards Council of India prescribes the code for self-regulation in advertising (the ASCI Code), which may be adopted by persons publishing advertisements on the internet. Compliance with such code is voluntary with respect to online advertising and not mandated by law. However, with respect to content on television, adherence to the ASCI Code is mandatory under the Cable Television Regulation Act 1995 (the Cable Television Act).

In addition, there are certain legislations and guidelines that prohibit the advertising and publication of certain specific types of content. A violation of these laws will entail consequences under those respective laws, including imprisonment. An illustrative list of such regulations is:

  • the Indian Penal Code 1860 prohibits any person from selling, advertising or otherwise distributing any obscene material (such as book, pamphlet, drawing, painting, representation). It also prohibits any person from distributing, circulating or advertising any picture or any printed or written document that is grossly indecent;
  • the Indecent Representation of Women (Prohibition) Act 1986 prohibits publishing or taking part in the publication of any advertisement which contains ‘indecent representation of women’ in any form;
  • the Infant Milk Substitutes, Feeding Bottles and Infant Foods (Regulation of Production, Supply and Distribution) Act 1992 prohibits advertising of infant milk substitutes, feeding bottles or infant foods for the purposes of distribution, sale and supply;
  • the Cigarettes and other Tobacco Products (Prohibition of Advertisement and Regulation of Trade and Commerce, Production, Supply and Distribution) Act 2003 prohibits all direct and indirect advertising of tobacco products in all media;
  • Flag Code of India 2002 prohibits use of the Indian national flag in any form of advertisement;
  • the Legal Metrology Act 2009 imposes certain prohibitions and restrictions upon the advertisement of pre-packaged commodities and certain other products;
  • the Drugs and Magic Remedies (Objectionable Advertisements) Act 1954 prohibits the advertisement of certain drugs and of misleading advertisements;
  • the Prize Chits and Money Circulation Schemes (Banning) Act 1978 prohibits advertisements relating to prize chit and money circulation schemes;
  • the Transplantation of Human Organs Act 1994, prohibits any advertising inviting persons to supply, offer to supply any human organ for payment;
  • the Young Persons (Harmful Publications) Act 1956 prohibits advertisements relating to any harmful publication, ie, any publication that tends to corrupt a person under the age of 18 years by inciting or encouraging him or her to commit offences or acts of violence or cruelty or in any other manner whatsoever;
  • the Drugs and Cosmetics Act 1940 prohibits advertisements for any drug or cosmetic from using reports of tests or analysis of the Central Drugs Laboratory or by a government analyst;
  • the Cable Television Network Rules 1994 prohibit any advertisement promoting the production, sale or consumption of cigarettes, wine, liquor or other intoxicants through the cable service; and
  • the Food Safety and Standards Act 2006, prohibits advertisement relating to the standard, quality, quantity or grade-composition, and no representation concerning the need for, or the usefulness of any food can be made, which is misleading or deceiving, or which contravenes the provisions of the food safety laws.
Definition

How is online advertising defined? Could online editorial content be caught by the rules governing advertising?

The term ‘online advertising’ has not been defined under Indian law. However, laws that regulate publication or advertisement of content in physical form are medium-agnostic and are equally applicable to content over the internet. Accordingly, any content that is published or advertised over the internet needs to be compliant with applicable laws that govern content and advertising in India, including the IT Act.

Misleading advertising

Are there rules against misleading online advertising?

Yes. In addition to certain industry-specific laws (some of which have been identified in question 19), the CPA prohibits, inter alia, the following trade practices used for the purpose of promoting the sale, use or supply of any goods, the practice of making any statement which:

  • falsely represents that the goods or services are of a particular standard, quality, quantity, style or model;
  • falsely represents any re-built, second-hand, renovated, reconditioned or old goods as new goods;
  • represents that the goods or services have sponsorship, approval, performance, characteristics, uses or benefits which such goods or services do not have;
  • makes a false or misleading representation concerning the need for, or the usefulness of, any goods or services;
  • gives to the public any warranty or guarantee of the performance or efficacy of a product that is not based on proper tests; and
  • permitting the publication of any advertisement for the sale of goods or services at a bargain price that are not intended to be offered for sale at such price.

As mentioned in question 20, given that there are no separate rules that regulate online advertising, the relevant provisions of the CPA are applicable to misleading advertising in the online space too.

The ASCI may call upon advertisers and advertising agencies to substantiate all descriptions, claims and comparisons that can be objectively ascertained. For instance, with respect to food and beverages, the ASCI Code mandates that advertisements should not be misleading or deceptive. Specifically, advertisements should not mislead consumers to believe that consumption of the product advertised will result directly in personal changes in intelligence, physical ability or exceptional recognition. Such claims, if made in advertisements, should be supported with evidence and with adequate scientific basis. In the context of misleading advertising, the ASCI has recently issued guidelines for celebrities in advertising (the Celebrity Guidelines). These Celebrity Guidelines have been developed to ensure that claims made in advertisements featuring celebrities or celebrity endorsements are not misleading, false or unsubstantiated. The Celebrity Guidelines impose certain obligations on the advertiser as well as the celebrity, for example:

  • it is the duty of the advertiser to make sure that the celebrity they wish to engage in an advertisement is aware of the ASCI Code and such advertisements should not violate any guidelines of the ASCI Code;
  • celebrities should not participate in advertising any products which, by law, require a health warning;
  • celebrities should also not participate in advertising of products, treatments or remedies which have been banned under the Drugs and Magic Remedies (Objectionable Advertisements) Act 1954 and Drugs and Cosmetics Act 1940 and the rules thereunder;
  • endorsements, representations of opinions or preference of celebrities in the advertisement must reflect their genuine opinion and must be based upon adequate information or experience with the product or service being advertised; and
  • celebrities should do their due diligence to ensure that all description, claims and comparisons made in the advertisement they appear in or endorse are capable of being objectively ascertained and capable of substantiation and should not mislead or appear deceptive.
Restrictions

Are there any products or services that may not be advertised on the internet?

Yes. Advertising of products such as cigarettes, tobacco and its derivatives, alcohol, infant milk substitutes, certain drugs, firearms and lotteries are prohibited under different laws, whether on the internet or otherwise (see question 19). Note that there is no specific prohibition with respect to advertisements in the online space. These restrictions and prohibitions are medium-agnostic.

Hosting liability

What is the liability of content providers and parties that merely host the content, such as ISPs? Can any other parties be liable?

The primary obligation under Indian law is cast upon the content providers to ensure that content hosted or published in any form does not violate any applicable laws (see question 19). Depending upon the nature of contravention, the content providers may be subject to civil and criminal liabilities. However, electronic intermediaries such as ISPs, search engines, online marketplaces, etc, are eligible to take benefit of safe- harbour provisions under the IT Act. To be eligible to take benefit of safe-harbour laws, the intermediary is required to comply with certain conditions such as:

  • the intermediary’s role should be limited to providing access to information made available by third parties;
  • the intermediary does not initiate the transmission of data made available by third parties;
  • it does not select the receiver of the transmission; and
  • it does not select or modify the information contained in the transmission.

It also needs to be demonstrated that the intermediary has observed ‘due diligence’ in discharging its duties under the IT Act and the IT Intermediary Rules, which require that the intermediary should not conspire, abet, aid or induce the commission of the unlawful act and should also expeditiously remove or disable access to objectionable content upon receiving knowledge.