Is the self-declaration mandate for advertisers a well-thought-out or hasty decision by SC?

New Delhi: The recent Supreme Court mandate for advertisers to issue a self-declaration certificate before releasing advertisements has raised concerns among ad and media agencies. 

While the step might be triggered by Patanjali’s misleading advertising and the staggering figures of ad violations presented in ASCI’s report, the industry thinks that the Supreme Court mandate seems more like a hasty decision than a well-planned route. Why? 

The meeting held by MIB on June 11, 2024, for this matter involved industry bodies questioning the practicality of the SDC mandate, particularly small and mid-sized businesses (SMBs). One key concern lies with the impact on small and midsized businesses (SMBs). 

Unlike large corporations with dedicated legal teams, SMBs often operate on tight budgets. The self-declaration process could add a layer of complexity and expense, potentially hindering their ability to compete in the advertising landscape.

"The SDC process could add a significant financial and logistical burden, especially for SMBs who lack dedicated legal resources," confided a senior executive at a leading advertising agency to BestMediaInfo.com. "This could stifle their ability to compete in the fast-paced advertising landscape." 

The rise of programmatic advertising, which relies on automated ad buying, throws another curveball. "Integrating self-declarations with programmatic platforms requires creative solutions," noted a digital marketing leader at a major brand. Pre-approving ad creatives or utilising third-party verification services are possibilities, but these could introduce delays or add complexity to fast-paced ad campaigns.

This could also impact time-sensitive advertising, particularly for news or social commentary. Delays in obtaining approval could hinder the ability to disseminate crucial information promptly. Industry experts suggest clear guidelines for "topical" content and a fast-track approval system for such campaigns as potential solutions.

However, the conversation doesn't stop there. The mandate might not effectively address the growing influence of social media advertising. Social media platforms are brimming with promotional content, some by brands and others by individuals. The current mandate might not cover these areas, leaving room for potentially misleading content to slip through the cracks.

Industry leaders are calling for a collaborative approach. Working together, regulators, advertising agencies, and advertisers can develop a system that promotes transparency and protects consumers while also considering the needs of small businesses and the fast-paced nature of modern advertising. This could involve initiatives such as: 

• Risk-based approach: Instead of a blanket mandate, consider a risk-based system. High-risk industries with a history of violations might require SDCs, while low-risk categories with clear regulations could be exempt.
• Random or regular audits: Implement a bi-yearly or quarterly system of audits to deter potential violations. This reduces the burden on all advertisers while maintaining vigilance.
• Simplified online compliance tools: user-friendly tools that guide SMBs through the self-declaration process.
• Industry-led self-regulation: collaborative efforts to establish best practices and ethical advertising guidelines.
• Third-party verification services: Encourage the growth of independent verification services that specialise in ad content review. Advertisers could voluntarily utilise these services to demonstrate compliance and enhance consumer trust.

The Supreme Court mandate will come into effect from June 18, 2024, for now. However, the recent meeting held by the Ministry of Information and Broadcasting (MIB) on June 11, 2024, saw industry bodies raising concerns about the practicality of the SDC. Following these discussions, there's a growing possibility of modifications to the mandate or even the exploration of alternative approaches.