The Tribune - Spectrum

, June 30, 2002

Deceptive advertising & you
D. S. Cheema

Advertising Law & Ethics
by Justice P.B. Sawant & P.K. Bandyopadhyay. Universal Law Publishing Co, Delhi. Pages 414 Rs 375

Advertising Law & EthicsADVERTISING is one of the major tools companies use to direct persuasive communication to target buyers. Advertising is recognised by the courts as a form of "commercial speech" which "does no more than propose a commercial transaction." "Commercial speech"must be regulated if it is misleading, if it concerns an illegal product or if there is substantial evidence that it is against the interest of the community.

Though advertising plays a very important role in our lives, it is constantly bombarded with criticism. It is accused of encouraging materialism and consumption, of causing us to purchase items for which we have no need, of taking advantage of children, of manipulating our behaviour, of using sex to sell, and of generally contributing to the downfall of our social system. In some parts of the world, governments have a negative attitude towards marketing in general and advertising in particular as these governments feel that consumers are at a severe disadvantage to the skills of advertising experts and, therefore, they deserve special protection. Consumer protection is one of the major rationale used for regulating advertising around the world.


It is obvious that some knowledge of law is necessary for every individual living in a civilised society. Just as one cannot drive a vehicle on the road without knowing the traffic rules, in the same manner, no human activity in general and business activity in particular can be carried on without all concerned having knowledge of the law which regulates such activities.

Advertising Laws and Ethics fills the long-felt need of having all the laws concerning advertising in one single volume. To that extent, it is a pioneering effort in India, though developed countries have laboured enough in this area to produce very detailed treatise for their use. The authors accept in the Introduction of the book that there is nothing original in it. Indeed, it is a compilation of all the material available at present on various aspects of advertising. The first five chapters of the book are brief (38 pages) and are devoted to general aspects of advertising viz, the power of advertising, right media for advertising, agencies and brand managers, future of global advertising and the Indian advertising scene. Statutory laws in India are covered in another 10 pages only. These 48 pages of the book are of maximum use to the Indian advertiser. The book also contains selected provisions of Hasbury’s laws of England on advertising as also extracts of American jurisprudence on advertising. The authors have also included summary of judicial decisions in India, selected cases decided by the Press Council of India and judicial decisions in certain other countries.

The chapter on self-regulations in advertising and codes of Advertising Standard Council of India (ASCI) is quite interesting. Regulations differ from country to country creating problems for firms that desire to globalise their advertising. For example, MTV Europe can’t show beer ads in Norway. Brazil requires that all advertisement shown in their country must have some local content. Australia prohibits all foreign commercials, and direct comparison advts are not allowed in Austria.

To understand these regulations, a host of issues need to be addressed. One central issue is definitional — what is deception? There are other issues as well. How many people need to misunderstand an advertisement before deception is involved? And when there is disagreement about what is deception, who should decide? How can the dishonest and careless advertiser be detected, prosecuted and punished? To what extent can self-regulation be relied upon? What are appropriate remedies? There questions and others make the issue of deception a complex area for an advertiser, the media and the government. The USA had constituted a special Federal Trade Commission (FTC) Act in 1914 for regulating deceptive advertising. It gives authority both over ‘unfair methods of competition’ and ‘unfair or deceptive acts or practices’. FTC considers a marketing effort to be deceptive if (i) there is a representation, omission, act or practice, that (ii) is likely to ‘mislead’ consumers acting reasonably under the circumstances, and, (iii) that representation, omission, or practice is "material." The term ‘material’ refers to the fact that some deceptive claims are trivial, and that FTC will not regulate such matters.

The Internet has emerged as a very powerful advertising media in recent years. It is estimated that by 2006 online ads will account for Rs 10 billion in India. Though the authors concede the importance of this form of advertising, there is no mention of cyber laws in the book. Until recently, there were no cyber laws in India. Using the Internet was, therefore, without any specific legal accountability. Since one of the most significant uses of the Internet advertisement is to conduct commercial transaction, Information Technology Act, 2000, has made it imperative for the country to adopt a regime of cyber laws which determine the rights and liabilities of parties using the Internet for business or otherwise.

It must be understood that law & ethics are not coterminous. The law is confined by limitations on government authority, primarily through the constitution, while ethics bear no such limitations. Ethics, therefore, should be subject to a higher standard of expectations than law.

The book a very useful reference material for judges, lawyers, researchers and students. Five appendices of the book spread over 170 pages contain valuable information which makes the book a must for them.