Jail term, heavy fines on celebrities for misleading ads: CAIT’s demand from Minister Paswan

By: |
September 6, 2019 10:33 AM

Small traders’ body CAIT has sought jail term for celebrities and brand ambassadors if they are found guilty of misleading advertisement.

CAIT has also said that fines for the false endorsements should be raised from the current levy of Rs 10 lakh.

Small traders’ body CAIT has sought jail term for celebrities and brand ambassadors if they are found guilty of misleading advertisement, the Confederation of All India Traders communicated to Union Consumer Affairs Minister Ram Vilas Paswan on Thursday. CAIT has also said that fines for the false endorsements should be raised from the current levy of Rs 10 lakh “as rich people will enjoy relaxations in government rules” if merely Rs 10 lakh are levied from offenders, CAIT said. The traders’ body added that the endorsements are purely a “commercial transaction” and celebrities and ambassadors act as “sales agent for the respective product or for a company”, making them an equal party in bearing liability.

As the government is charting new rules & regulations under the Consumer Protection Act 2019, the proposed rules must be included in the new Act which is already passed by both houses of the Parliament, according to a statement by CAIT. Commenting on the current penalty of Rs 10 lakh for deceptive advertisements, CAIT National President B.C.Bhartia & Secretary General Praveen Khandelwal said: “The celebrities or brand ambassadors charge quite a huge amount much larger than Rs 10 lakhs for endorsing any product and in the event of action against any misleading advertisement, payment of Rs 10 lakhs as penalty will be the easiest way for them to escape from the liability”. 

What qualifies for the advertisement?

Any advertising message that includes “verbal statements, demonstrations, or depictions of the name, signature, likeness or other identifying personal characteristics of an individual that consumers are likely to believe reflects the opinions, beliefs, findings, or experiences of a party”. 

Previously, in July 2019, the government had made proposals for amendments in the Consumer Protection Act and said that celebrities will now be held accountable for false advertisements. Keeping in mind the changing retail scenario of the country, the government also proposed changes in e-commerce laws. The final framing is yet to be done under the Act. 

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