No Jail, Heavy Fines Will Be Imposed On Celebrities Endorsing Products In Misleading Ads

A Group of Ministers (GoM) has decided that celebrities who are found endorsing products with unrealistic and dodgy claims will not be imprisoned, but instead will face of up to Rs 50 lakh fine and a ban on appearing in advertisements for up to three years.

The GoM on Wednesday decided to take a look at the issue and agreed to obliterate the provision of imprisonment of celebrities, as such measures are not practiced in any country.

The GoM is headed by Finance Minister Arun Jaitley and includes Transport Minister Nitin Gadkari, Communications & IT Minister Ravi Shankar Prasad, Health Minister J P Nadda, Commerce Minister Nirmala Sitharaman and Power Minister Piyush Goyal and Food and Consumer Affairs Minister Ram Vilas Paswan. Paswan’s ministry piloted the Consumer Protection Bill, 2015.

The proposal has been cleared by Union Cabinet and the Bill is expected to pass in the winter session.

The Consumer Protection Bill, 2015, which seeks to replace the Consumer Protection Act, 1986, by inserting tough measures for the protection of consumer rights and providing strict punishment to violators, was presented in Parliament in 2015.

Earlier, measures were suggested to a Standing Committee to make celebrities accountable for the brands they endorse. The panel had recommended that for first-time offence, the offender celebrities may be penalised with either a fine of Rs 10 lakh or imprisonment up to two years or both. For second-time offences, it had suggested a fine of Rs 50 lakh and imprisonment of five years.

The GoM has now decided that instead of jailing the endorsers, they should be fined Rs 10 lakh and would face a ban of one year for the first offence, and fined Rs 50 lakh and banned for up to three years for the second offence.

Who called for brand ambassadors to be brought under the ambit of this act?
The Confederation Of All India Traders (CAIT) had demanded the inclusion of brand ambassadors under the ambit of the act, as they felt that it is based on who the brand ambassador is that many consumers make their choice. The issue came to light after the ban on Nestle India Ltd’s Maggi Noodles, which was later lifted.