Celebrity Endorsement in the Consumer Protection Bill

Picture Courtesy: https://blog.hollywoodbranded.com/celebrity-endorsement-deals-gone-wrong-when-brands-cross-the-line

This article was written by Maahi Mayuri, a student of  New Law College, Bharati Vidyapeeth Deemed University, Pune.

Introduction

To brief oneself with the concept of celebrity endorsement in the consumer protection bill, one should firstly know the concept of the consumer protection bill and how it comes handy. Consumer protection is the protection of a consumer from business malpractices and malafide intentions of the businessmen to gain huge profits.

What is the need and importance of consumer protection?

• Shielding of a consumer from abuse becomes the main objective of consumer protection and the possibility of consumers being abused greatly reduces through a consumer protection bill.
• It makes the buyers aware about their rights.

This article aims to understand the position of celebrity endorsement with respect to the recent consumer protection bill. Every day, you may see advertisements by various prominent personalities endorsing a product to its best. But what if, that very product is not the same?

Celebrity Endorsement

Advertisement plays a great role, be it India or any part of the world. It helps promote certain products by highlighting its selling points. But, with the number of advertisements becoming numerous and uncountable with each passing day, not every advertisement catches the eye of the common man, and for that purpose, the appearance of a celebrity increases the chance. Big Companies and producers are willing to invest millions at advertising and involving celebrities to endorse their products. But now, the question arises as to what would be the position of celebrities who endorse products which end up abusing the consumers.

Recently, an explanation was sought from Supertech Ltd. the National Consumer Disputes Redressal Commission despite an inordinate delay in handing over the possession of homes to homebuyers in regards to its Noida, ORB Project. Twinkle Khanna, an actor and interior designer, who was promoting the project was also the one who received a notice from the commission.

The accusation on the defendant, who was a real estate developer comprised that there was a breach of promise resulting from a failure to deliver the residential units within the promised time. The plaintiffs accused Twinkle Khanna of being a party to the breach of promise because of the fact that she actively endorsed the project.

The aforementioned is just a trivial scenario of a celebrity endorsing a product which does not meet what was claimed initially. There are many instances and the above is just a minor example. There thus felt a need to handle such a situation, and provisions related to such endorsements were introduced by bringing of the Consumer Protection Bill.

The Consumer Protection Bill, 2015

Celebrity endorsements play a major role on sales of a product but is not limited to so. The same also has a psychological effect applicable to both the product and the celebrity. Celebrity brands enjoy the privilege of being the top sold brands with the producers making unparalleled profits. But, it with the onset of the Consumer Protection Bill, 2015,  celebrities would no longer enjoy the unsupervised freedom they earlier had. Instances of criminal complaints against Bollywood stars for the endorsements of products like Maggi also influenced the government to build a new statute which would repeal the 1986 act.

The Consumer Protection Bill was recently introduced in the Lok Sabha on Jan 5, 2018 on the last day of winter session and has been discussion since August 2015. The same was introduced by the consumer affairs minister, Ram Vilas Paswan with the objective that it curbs malpractices and shuns false claims by service providers as well as the manufacturers. The parliamentary standing committee on food, consumer affairs and public distribution has recommended that strict accountability for celebrity endorsements be brought under the bill.

Current provisions make a celebrity liable only when the misleading endorsement or promotional activity has adversely affected the consumers interest. The same comes  under the provisions of the Indian Penal Code, 1860, the Consumer Protection Act, 1986 as well as the Food Safety and Standards Act, 2006. Heavy penalties are imposed in case of misleading advertising.

The committee has felt the need for improved provisions due to the fact that the current provisions do not suffice in preventing producers from dealing with misleading advertisements. It also was of the view that a misrepresentation regarding consumable products should be taken very seriously. Thus, the celebrities come under the umbrella of strict provisions as to misleading endorsement of products.

Initial proposal of penal provisions witnessed ₹100,000 (US$1,500) as the maximum fine as well as imprisonment for up to two years for first time offenders. For subsequent offenders, the maximum fine rises upto ₹500,000 along with an imprisonment that may be up to five years.

Recent media reports have claimed that a fine of the proposed penalty is a fine of up to ₹1 million in case of the offence first-time and ₹5 million for a subsequent offender. Also there are provisions for imprisonment in case of unsafe and hazardous products. Imprisonment provisions were dropped for the rest and a ban for one year would be imposed on the celebrity participating in misleading endorsements for the first time and the ban is for five years for all the subsequent times.

Conclusion

The bill tends to inculcate a sense of responsibility among celebrities and aims that they should know what they are dealing with. Due diligence on their behalf is necessary even though it may be hard for them to look into the intricacies of the product.

There is a sparkling debate on the bill especially in the advertising, talent management and legal industries. The main point of concern for the critics goes on to be the punitive liabilities which could be arising out irresponsible advertising, false claims and malpractices.

 The bill, if brought into power, would be a milestone for consumer protection and responsible endorsements. Even though celebrities are not at fault themselves and neither do they know about the false claims, the bill introduced in the parliament, still aims to create a sense of responsibility within their minds. The legislation aims to send a message that blindly endorsing a product would create a liability. It therefore becomes the responsibility of public figures to act responsibly while endorsing any product.