Scrap new rules on self-certification of ads, IAMAI urges Supreme Court

New Delhi: The Internet and Mobile Association of India (IAMAI) has asked the Supreme Court to reconsider new regulations that require advertisers to upload self-declaration certificates before putting out ads on TV, in print, or online. The new rules, which took effect on 18 June, aim to curb misleading ads but IAMAI argues they will instead hamstring the digital economy.

IAMAI is a non-profit with about 600 members ranging from startups to multinational companies. In its petition, which Mint has accessed, it said that while it supported efforts to prevent false ads, the new self-declaration requirement would severely disrupt online advertising. It urged the court to reconsider the self-declaration rule, and called for consultations with the government to find a solution that protects consumers while supporting the growth of the digital economy. 

Also read: Confusion, website glitches mar first day of new ad rules

A spoke in the flywheel

One of IAMAI’s main concerns was that the new rules would slow down or even halt online ad campaigns. Online ads are crucial because businesses can track their performance in real time and make quick adjustments if needed. This flexibility helps companies target their audiences more effectively and boost sales, IAMAI said. The new rules, it added, would hinder this process, making online ads less effective and hurting revenue. Small and mid-sized companies will be hit the hardest as they rely heavily on online advertising and may not have the resources to comply with the new rules, it said.

Also read: A three-pronged taskforce in the works to rein in digital ads

"The primary issue is with digital ads as their frequency is far [higher] than TV, print or radio ads. For instance, if a company puts up 20 digital ads a day, it will need significant resources to comply with the self-declaration rule. The [benefits] of digital ads – speed and quick calibration – will be hampered. There is also the issue of what constitutes an advertisement and what does not. Many social media posts, for instance, may not necessarily be ads," Dhruv Garg,  a tech policy and legal consultant based in Delhi told Mint.

Enforce existing laws, says IAMAI

The industry body added that existing laws such as the Information Technology Act and the Consumer Protection Rules already have robust mechanisms to deal with misleading online ads. Stronger enforcement of these laws would better protect consumers than the new rules, it added.

IAMAI’s petition highlighted the significant role online advertising has played in creating economic opportunities, especially during the pandemic, when many businesses were forced to shift online. It also cited a study by GroupM, which estimated that digital ads would account for 57% of total ad revenue in India in 2024.

Also read: Targeted ads become focal point of digital competition debate