The Ministry of Information and Broadcasting’s (MIB) new regulation, effective 18 June 2024, mandates a Self-Declaration Certificate (SDC) for all ads to curb misleading claims. After industry protests, the rule now applies only to food and health ads.

We at Manifest investigate whether this well-intended but possibly hasty regulation stifles advertising creativity by increasing compliance burdens.

Naresh Gupta, co-founder and CSO, Bang in the Middle (BITM) and Vishal Kaushik, former director - enterprise strategy and new products, MSD, debate on the topic. 

What are the primary reasons behind the introduction of the Self-Declaration Certificate (SDC) requirement by the Ministry of Information and Broadcasting, and do you believe it effectively addresses those issues?

Naresh Gupta (NG): The need for SDC was a result of the case against Patanjali and it was a Supreme Court decision. I suspect this was to ensure that brands cannot claim that they didn’t know of potential legal issues that may arise later due to their actions. I don’t think the order was hasty or time was not given to prepare, however, the process was time-consuming and there were costs involved in implementing it for brands and agencies. There was a lack of clarity, as it always happens. It started as SDC for all ads, but it has been reduced now to just food and beverages, which is a big relief for advertisers. The rest of the categories have to file only once a year.

Vishal Kaushik (VK): The SDC was introduced by the MIB in response to concerns about misleading advertising and an SC directive issued on 7 May 2024. This is a new beginning in the consumer safety direction and is a welcome step. It certainly intends to bring transparency and consumer safety, especially from an online perspective and aims to mitigate the deceptive advertising and misleading claims made by more than a few players. Being in this field for the last two decades, I believe that this will certainly impact consumer/healthcare sector advertising and will bring responsible execution. 

Do you believe that the SDC mandate curbs the creative freedom of advertisers and agencies by unfairly placing an increased compliance burden on them, or do you think the regulation strikes the right balance between protecting consumer and advertiser interests?

NG: I do not think that the need for SDC is either restrictive or inhibits the process of creation. There is no new rule or law that has been enacted. SDC only asks the brands to certify that what they have created is within the ambit of the law. I personally think it is great for the consumers as they will not be subjected to misleading claims.

VK: Freedom is as much a responsibility as it is a right. And compliance is never a burden or unfair. It is of paramount importance. A responsible creative team will need to navigate this path in close coordination with the client partners. I have personally witnessed that it works wonders when the creative team works in tandem with domain experts who are aware of the existing regulations and guidelines. The responsibility of striking the right balance between consumer protection and advertiser interest lies not just with the advertising team but with the client as well. SDC is a movement in the right direction and with time can certainly improve with close partnership with the industry. Instead of fear of compliance awareness of it will be beneficial for everyone. 

Advertisers and industry bodies have expressed apprehension on how the new rule can work in a medium like digital, where turnaround time is critical and the volume of ads is higher, as compared to non-digital platforms. Do you believe the ministry must re-evaluate if these measures constitute a proportionate and feasible response?

NG: I believe that speed cannot come in the way of law. As with any commercial entity, the quest of business cannot be at the cost of following rules. If the brands and agencies follow all the rules of finance without any hassle, this too can be followed. It’s just aligning the internal process and it’s not difficult. The process is simple and you don’t have to wait for approvals. We should realise that the insurance sector already has a regulator who approves all the ads and it works well.

VK: The concerns raised by advertisers and industry bodies regarding the SDC on the digital medium are valid. Here’s why re-evaluation might be necessary:

1.            Turnaround time: In the fast-paced digital landscape, quick ad deployment is crucial & the SDC process could slow down approvals, affecting campaign timelines and potential impact. The ministry should assess whether the SDC requirements align with the rapid pace of digital advertising without compromising accuracy.

2.            Volume of ads: Digital platforms handle a vast number of ads daily. Ensuring compliance across this volume is challenging. Striking a balance between efficient ad delivery and thorough compliance checks can be achieved by relevant expertise and experience in the creative and client teams.

3.            Feasibility: There needs to be a tailored approach. Perhaps have different rules for high-risk sectors (like healthcare) and lower-risk ones could be considered.Engaging with stakeholders can provide insights into practical challenges and potential solutions. Having a detailed industry consultative approach and considering digital nuances for operational reasons would ensure that the SDC remains effective while addressing industry concerns.

What do you foresee as the potential long-term effects of the SDC mandate on food and healthcare advertising? Would there be any plans to review or streamline the regulatory process based on feedback from the industry?

NG: I see the ads becoming more realistic with claims being monitored and consumers not being misled.

VK: The SDC mandate is likely to have several long-term effects on food and healthcare advertising.

Advertisers will become more accountable for the accuracy of their claims. The SDC ensures that health-related claims are backed by evidence, benefiting consumers. Over time, this accountability may lead to more responsible advertising practices and will improve trust between brands and consumers. Conversely, violations could harm the brand’s reputation and consumer trust. The SDC requirement forces the creative team to validate the information before executing the ads. This could improve the overall quality of health-related content. Consumers will have access to more reliable information, leading to better-informed decisions.

Regarding regulatory review and streamlining: Regular industry feedback and evaluation are crucial. The ministry should actively seek input from stakeholders. Striking the right balance between compliance and industry feasibility is essential. The regulatory process should evolve based on real-world experiences and emerging challenges.

In summary, the SDC mandate aims to create a more transparent and reliable advertising landscape. Industry feedback will guide adjustments to ensure effectiveness without undue burden. Now both sides are going through teething struggles but in the long term, this will be beneficial for consumers and advertisers alike.

(This article first appeared in the August issue of Manifest, part of the monthly Perspectives feature. Buy the copy here)