ASCI’s Draft Guidelines for Influencers: Setting New Hurdles or New Trends?

Introduction 

The Advertising Standards Council of India (ASCI) on 22 February 2021 published its “Draft Guidelines for Influencer Advertising on Digital Media” (Influencer Guidelines) and had invited feedback from the public on them till 8 March 2021.  

In 2017, ASCI published the Guidelines for Celebrities in Advertising (ASCI Celebrity Guidelines), which required celebrities to ensure that claims made in advertisements are not misleading, false, or unsubstantiated.  

The Consumer Protection Act, 2019 (CPA 2019) introduced the concept of ‘endorsements’ which cast a duty upon an endorser to exercise due diligence to verify the veracity of claims made in the advertisements regarding the product or service being endorsed.   

In Marico Limited v Abhijeet Bhansali (Notice of Motion No 1094 of 2019 in COMIP No. 596 of 2019), a case involving product disparagement by an influencer, the Bombay High Court noted that social media influencers have a higher responsibility to ensure that their statements do not mislead the public and disseminate correct information. 

The Influencer Guidelines follow the CPA 2019 and the ASCI Celebrity Guidelines. Similar to the CPA 2019 and the ASCI Celebrity Guidelines, the overall intent behind the Influencer Guidelines appears to be to protect average consumers from misleading advertisements.  

Influencer Guidelines 

The Influencer Guidelines propose the following obligations on “influencers” advertising on digital media: 

• Distinguishable content: An average consumer should be able to distinguish between an advertisement and editorial / user-generated content posted by an influencer. 

• Disclosure label: The Influencer Guidelines provide a list of pre-approved labels to be affixed by influencers as part of endorsements, within the first two lines of a platform in a prominent manner, such that the viewer does not have to click on ‘see more’ or scroll further. 

• Nature of disclosure: The disclosure label should be translated in English or the language of the advertisement should be well understood by the average consumer. The disclosure must be in each individual review and should not be of a blanket nature i.e., in the profile or about section of the influencer.  

• Placement of disclosure: The disclosure label should be superimposed over the picture if the advertisement is only a picture post. In case a video is not accompanied by a text post, the disclosure label should be imposed on the video such that it is easily visible to the viewer depending upon the duration of such video. In the case of audio media, disclosures should be announced at the beginning and the end of the audio.  

• Due diligence: Influencers are required to undertake due diligence for any technical / performance claim while promoting products.  

• Contracts: ASCI also recommends that contracts between influencers and brands/advertisers should include provisions pertaining to disclosure requirements, due diligence as well as usage of filters. 

In comparison to the CPA 2019 and the ASCI Celebrity Guidelines, the Influencer Guidelines take a step further and flesh out the disclosure requirements for each type of digital media endorsement. 

Role of ASCI  

ASCI is a voluntary self-regulatory organization that ensures that advertisements across all media conform to the ASCI Advertising Code, and as such guidelines issued by ASCI do not by themselves have statutory force. The Government of India has previously ensured that advertisements in the television space abide by the ASCI Advertising Code by amending the Cable Television Networks Rules, 1994 to include a provision prohibiting cable services from carrying advertisements that violate the ASCI Advertising Code.  

International landscape 

We have set out some examples of influencer advertising norms in a few key international jurisdictions. 

United States of America: The Federal Trade Commission in the United States of America, recently released the “Disclosure 101 for Social Media Influencers” which provides tips to influencers regarding factors that trigger the need for disclosure and offers examples of both effective and ineffective disclosures. 

United Kingdom: The Advertising Standards Authority along with the Competition and Markets Authority in the United Kingdom, recently issued joint guidance for brands and influencers - “An Influencer’s Guide to Making Clear That Ads Are Ads” which sets out what constitutes (i) an advertisement; (ii) control of a brand over an influencer’s posts; and (iii) advertorial posts making it clear that it is advertising.  

Australia: In Australia, the Australian Association of National Advertisers introduced a “Code of Ethics” obligating influencers to disclose in their posts commercial relationships in a clear and upfront manner, even if no labels are included.  The Australian Influencer Marketing Council also introduced an “Influencer Marketing Code to Practice” setting out guidelines on advertising disclosure, influencer vetting, and contractual considerations including content rights usage and reporting metrics. 

Singapore: The Advertising Standards Authority of Singapore issued the “Guidelines for Interactive Marketing Communication & Social Media” setting out obligations for influencers including (i) prominent disclosure of commercial relationships, and (ii) distinguishable paid reviews and endorsements as opposed to other editorial content. 

The Influencer Guidelines appear to be principally similar to internationally accepted norms. However, the key difference, when compared to the international norms, the CPA 2019 and ASCI Celebrity Guidelines, is that the Influencer Guidelines propose a list of pre-approved disclosure labels for various social media platforms and specific manner for their placement of in video and audio posts.  

Conclusion 

Considering that the influencer advertising space is recognised as a separate market internationally including by various regulatory bodies in different jurisdictions, there is no doubt that the influencer space is already a mature advertising segment requiring regulations to combat its own dynamism and reach. The introduction of the Influencer Guidelines by ASCI reinforces the fact that new age influencer space in India has already become a significant advertising avenue. 

Digital media platforms (including short video platforms), which are primary mediums for influencers to scale their popularity, and brands, management agencies engaging influencers for their services, will also benefit from the Influencer Guidelines, in as much as they will no longer have to rely solely on contractual arrangements and organisational policies for monitoring the conduct of an influencer, but can now rely on a recognised body such as the ASCI and its mechanisms with respect to the business and conduct of influencers on digital media.