The government intends to tighten the noose to safeguard consumers from excessive claims made by advertisements in sectors such as edtech and cryptocurrencies. It has now constituted separate committees to tighten guidelines on promotional claims by these corporations and provide a remedy to aggrieved customers.
A top government of India official indicated in a media encounter that the Ministry of Consumer Affairs has organized three panels to develop guidelines and FAQs on cryptocurrency, edtech companies, and fraudulent reviews that have grown prevalent on e-commerce platforms.
More About the New Committees
According to Rohit Kumar Singh, Secretary at the Ministry of Consumer Affairs, the committees were constituted with cooperation from all industry players.
“About ten days ago, we met with representatives from all e-commerce industry stakeholders, including firms, ASCI (Indian Advertising Standards Council), industry associations CII, FICCI, Assocham, and others,” said Singh.
“It is to create criteria to combat fake reviews on e-commerce platforms, which are something that even businesses wish to avoid. Within 60 days, the guidelines will be finalized.”
He went on to say that, according to a European Commission report, over 55% of enterprises operating in the EU are affected by fake reviews, indicating the magnitude of the problem.
A special committee, led by Joint Secretary Anupam Mishra, has been constituted to monitor extravagant claims made by edtech businesses in their advertising and promotional activities. The third panel is in charge of creating FAQs on cryptocurrency, which is heavily taxed. According to Singh, another Joint Secretary in the ministry, Vineet Mathur, is in charge of this committee.
Advertising Guidelines for Crypto
The Advertising Standards Council of India (ASCI) has issued 12 standards for the advertisement and promotion of virtual digital assets (VDAs) and services such as cryptos and non-fungible assets, which went effective from April 1, 2022. (NFTs). The following are the guidelines:
- “Crypto products and NFTs are unregulated and can be exceedingly dangerous,” the disclaimer will appear on any marketing for crypto products, exchanges, or virtual digital assets. There could be no regulatory remedy for any losses incurred due to these transactions.”
- A typical consumer should be able to see the disclaimer since it is “prominent” and “unmissable.”
- The disclaimer must be written in the advertisement’s language.
- In advertisements, words like “money,” “securities,” “custodian,” and “depositories” are prohibited.
- “Crypto is legal” cannot be stated in the advertisement.
- Advertisements must be honest about the expenses or profits incurred by customers.
- “Zero Cost” should mean “no cost at all,” with no hidden fees.
- Past performance data can only be utilized with data from the previous 12 months.
- It should be unbiased.
- Customers should be able to contact you via email or phone numbers listed on the ad.
- There must be no minors in the advertisements.
- Cryptocurrency trading should not be advertised as a solution to the financial crisis.
- There should be no guarantee of refunds.
- Advertisements cannot convey how simple it is to understand VDA products.
- The risks should not be minimized in the advertisement.