Who will bell the self-declaration cat: agencies or advertisers?

Ever since the Supreme Court of India issued a directive on May 7, 2024, mandating all advertisers and advertising agencies to submit a self-declaration certificate before publishing or broadcasting any advertisement starting June 18, 2024, (yesterday) the advertising and marketing industry has been shaken.

Industry stakeholders and several media and advertising industry bodies have voiced their concerns about the implementation and practicalities of the mandate. The Ministry of Information and Broadcasting (MIB) will submit the stakeholders’ response to the Supreme Court on July 9, 2024.

While there is a lot of ambiguity around the guidelines and their implementation, one particular concern for all parties involved is who is ultimately responsible for filing the self-declaration.

As per the guidelines announced, “It is mandatory for every advertiser/advertising agency to submit a self-declaration certificate affirming that the advertisement does not make misleading claims and complies with all relevant regulatory guidelines, including those stipulated in Rule 7 of the Cable Television Networks Rules, 1994.”

A senior leader at a digital agency states that there’s a tug-of-war between brands and agencies over who will file the self-declaration and take responsibility for it. According to industry leaders, many agencies and advertisers are confused about who the onus of the ‘declaration’ falls upon.

According to Arvind Krishnan, founder and CEO at Manja, the fundamentals of client-agency relationships have changed over the years due to the rise of project-based work, and many brands now work with multiple agencies, unlike earlier.

“In that case, I feel it’s completely fair for the client to take the onus of the declaration because they have different teams and agencies working on different communications. The other situation is where you retain a business and have a very long-term relationship with the brand. I feel that in that situation only should there be confusion about who will be responsible for filing it.”

Deepti Karthik, founder of Decision Pinnacle and fractional CMO at Sleepyhead, says, “The responsibility for these declarations lies with the advertisers, not the advertising agencies, because advertisers are the ones who know the ingredients and can make claims about their products. Even if an agency creates an ad, it can be rejected by the brand marketer, who ultimately decides whether to proceed or not. Therefore, the advertiser, as the decision-maker, must fill out the self-declaration.”

She says while there should be a shared sense of responsibility for the honesty and integrity of advertisements, the final accountability rests with brand marketers. She adds that even within organisations, there may be discussions about who should sign the declarations—whether it be marketing managers, heads of marketing, CEOs, or owners. Despite the logistical challenges, the brand owner is ultimately responsible.

Similarly, Manu Prasad, fractional CMO, states that this new regulatory approach to self-declaration seems to be rooted in traditional media perspectives, and there is a lack of understanding in terms of how it will work with digital media.

“Google’s display network spans millions of sites, and on Facebook, ads can be targeted to specific audiences. Will push notifications on apps like Zomato count in this order? There is a significant lack of understanding regarding how this will operate, and introducing bureaucratic hurdles may not have been fully considered in this regulatory framework,” explains Prasad.

According to Prasad, the situation particularly puts agencies in a fix because the client will likely ask the agency to handle compliance. However, liability will rest with the brand, unless the client specifies in the contract that the agency is liable for this particular task.

“This process puts agencies in a difficult position. They must secure certificates before running ads, making the operational tasks their responsibility, while ultimate accountability remains with the brand. No client will handle these tasks themselves, pushing the burden on to the agency,” he opines.

“Currently, we are just considering clients and agencies, but what about digital ads created by internal teams? There’s a significant lack of awareness about them,” he adds.

 Jonathan Sreekumaran, chief business officer at 4AM Worldwide, adds that the matter of who files the declaration is a logistical concern; proficient agencies will establish workflows and processes to seamlessly integrate this step.

“Expect marketers to begin paying additional fees to their agency partners to ensure compliance. It remains to be seen how the Ministry of Information & Broadcasting (MIB) and the Advertising Standards Council of India (ASCI) will address operational concerns that could stem from the enforcement of the regulation,” he says.

Panic and distress

While many have welcomed the move to safeguard the audience's interests against misleading advertising, the industry feels the situation requires more attention and consideration. Media owners and industry bodies are coming up with different solutions to help advertisers navigate the situation. For example, the Press Council of India (PCI) has also issued guidelines to generate a self-declaration certificate. The certificate would be required from all advertisers/agencies before publishing advertisements. Its purpose is to verify that the content in the advertisements is true.

According to Neha Singh, vice president at Enormous, the agency and clients are both navigating the situation together. She says that the agency and their clients have been on back-to-back calls ever since the development.

“There is no fight between us and the clients, but work releases have been stalled until more clarity comes in on 9th of July from the Supreme Court and a few advertisers are not putting out work at all. This is the most panicked and uncertain people have been since COVID,” says Singh.

Siddharth Devnani, co-founder & director, SoCheers states that the responsibility of the brand is to be true to themselves in their communication and packing - and not to mislead the consumer and the role of an agency is to craft great marketing campaigns for the brand.

He says while the brand is responsible for all the claims made he foresees them outsourcing the task to their agencies. "In fact, I won’t be surprised if some enterprising opportunists set up companies specifically to get this task off the brand's hand."