Exempt ASCI members, start ups from SDC mechanism: MIB affidavit to SC

The Ministry of Information and Broadcasting (MIB) has submitted an affidavit to the Supreme Court, recommending one Self Declaration Mandate (SDC) for all media on August 23. It has suggested the provision for all ads in a single portal only for the Food and Health sector.

In its suggestions, MIB recommended exempting ad agencies, print media, ASCI members, and startups from the SDC mechanism.

“The I&B Ministry’s recommendation to exempt programmatic ads, online ads and user-generated content is a welcome move as it favorably accounts for suggestions by various stakeholders,” Gauhar Mirza, Partner, Cyril Amarchand Mangaldas. 

As per Mirza, this would reduce compliance burdens and regulatory pressures on the industry, which consists of millions of campaigns, ads and creatives published across the internet, TV, radio and print. With fewer restrictions, creators are likely to produce a wider variety of content without the requirement of compliance with the onerous obligation of an SDC.

MIB’s affidavit comes after SC’s order, directing the ministry to submit an affidavit within three weeks with recommendations on SDC mechanism for ads.

A bench comprising Justice Hima Kohli and Justice Sandeep Mehta asked MIB to submit an affidavit comprising recommendations for the SDC mechanism.
The Supreme Court also said, “Let the copies of the affidavits be furnished to the amicus and any non-compliance by states shall be informed to this court and let a note be submitted before the next hearing.”

According to the Apex Body, the intention of the court is not to cause any harm to anybody. The intention is only to focus on particular sectors and particular aspects. Whatever is extraneous and somehow is being interpreted otherwise shall be clarified.

The affidavit was filed by Senthil Rajan, Joint Secretary in the MIB, seeking exemption for ad agencies, and exclusion of programmatic ads and user-generated content from the SDC system.

The affidavit asked for an exemption for ad agencies from uploading SDCs, stating the three main types of ad agencies: creative agencies, media agencies, and performance agencies.

“Creative agencies focus on developing ads based on the advertiser's mandate and claims about their products or services. Media agencies handle media planning and purchasing. performance agencies use data, technology, and expertise to achieve success in the digital space. Therefore, they suggested that Advertising Agencies should not be compelled or made liable to upload SDC because one can have multiple advertising or media agencies.”

Another suggestion was that SDCs may not be feasible for programmatic advertisements published on digital platforms as these are carried through network agencies and real-time bidding from the open market.

The affidavit also pushed for the exclusion of user generated content and online advertisements. “For internet advertisements, ti was suggested that the definition of 'advertiser' should not include user generated content' and online advertisements may be excluded from the SDC mandate,” it read.

The scope of SDCs should be restricted to medical-related ads with claims of healing, to address misleading health claims. Another suggestion came that Advisory should be limited to Ayurvedic products which is subject matter of instant litigation.

The affidavit also suggest the use of a single user-friendly portal accessible to the relevant stakeholders. “To provide a more streamlined user experience for consumers and concerned stakeholder, two portals may be consolidated into a user-friendly single portal and its database may be integrated. Currently, the format of the SDC is similar for both the portals and the certificate generated is also similar. It is merely being generated through two separate portals. Therefore, a single unified portal will be more efficacious.”

It recommended that Advertising Standards Council of India (ASCI) members be exempted since they are compliant with the ASCI Code, which is harmonious with various advertising laws of the country and ASCI members have demonstrated track record of voluntarily complying with the ASCI Code.

Print media, which is already governed by the rules of ASCI and Press Council of India, should also be exempted, said MIB.

It also sought exemptions for all platforms taking proof of SDC uploads from advertisers, which the ministry believed was only an excessive step.  

"It is also suggested that the period from 18.06.2024 till the final verdict in this case is delivered by this Hon'ble Court," said the affidavit.

Recommendations of Association of Radio Operators for India (ARON), Internet and Mobile Association of India (AMAI), Broadband India Forum (BIF), Indian Newspaper Society (INS), Indian Society of Advertisers (ISA) and Advertising Agency Association of India (AAAI) were part of the affidavit, which included the request for a single portal and suggestion that SDCs should be the onus of private companies and advertisers, not ad agencies.

Alay Razvi, Partner, Accord Juris believes the benefit for the industry with this exemption will be it will have lower costs for digital platforms and advertisers, making it easier for businesses. The small enterprises will be happy to invest in online advertising which will boost the digital space. While there are benefits,  there would be more protected guidelines to be followed in protecting the user data for ensuring there is transparency in ads.

According to the recommendation letter, it was also suggested that Print Media may be exempted from seeking Self-Declaration Certificate from the advertisers/advertising agencies since the print media industry is already governed by rules/norms/regulations of ASCI & Press Council of India.