Volume IconAmitabh Bachchan, pan masala, and the noise around surrogate ads in India

Surrogate ads of liquor and tobacco products have been banned in India since 1995. But we still see celebrities indirectly promoting such products. What's the regulation, and where are the loopholes?

TV advertising

Amitabh Bachchan recently pulled out of an endorsement deal with a popular pan masala brand on his 79th birthday after facing a backlash on social media. The Bollywood megastar, who featured in the ad for this brand’s ‘silver-coated cardamom seeds’ with actor Ranveer Singh, claimed that he was not aware when the ad was being filmed that it fell under surrogate advertising. He also returned the money he had received for the endorsement.

This was not the first time an actor had landed in such a controversy. In 2016, former James Bond actor Pierce Brosnan had appeared in a surrogate advertisement for another pan masala manufacturer. He had claimed that the company cheated him by not disclosing the harmful nature of its product. The company, on the other hand, stressed that the product Brosnan endorsed was a mouth freshener and should not be associated with chewing tobacco. 

Several actors, including Shah Rukh Khan, Ajay Devgn, Mahesh Babu, Salman Khan, Anushka Sharma, Priyanka Chopra, Tiger Shroff and Hrithik Roshan, have also made appearances in the ads of mouth fresheners made by pan masala brands. 

India’s pan masala market size* 

2020: Rs 45,585 crore
2026: Rs 69,518 crore 

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*Projections by IMARC Group

According to market research firm IMARC Group, the size of the pan masala market in India, which was Rs 45,585 crore in 2020, is projected to reach Rs 69,518 by 2026. 

Amitabh Bachhan’s pullout has reignited a debate on the legality of such ads. Companies use surrogate advertising as a workaround to promote tobacco and alcohol products, whose advertising is banned by law in the country. 

But how are celebrities able to promote such brands? It is done through what is called surrogate advertising.

Surrogate advertising first surfaced in India after the Cable Television Networks (Regulation) Act 1995 banned direct advertisements of liquor, cigarettes and tobacco products. 

Such ads promote the established brand names of companies whose main products fall under the category whose advertising is not allowed. This is done by using the same brand names for different products altogether. The purpose of surrogate ads is to increase brand recall in the minds of consumers. New products carrying the same brand name are known as brand extensions, which is not illegal under the Act. The rules allow some liberty for such surrogate advertisements under the pretext of brand extensions. Notable examples include the ads for soda and music CDs by liquor companies. This is done using trademark diversification.  

The Cigarettes and Other Tobacco Products Act (COTPA) 2003 prohibits direct and indirect advertising of tobacco products. This Act also does not allow ads of other goods using the brand name of tobacco products.

But plain pan masala that does not contain tobacco can be advertised on television, even though its packaging contains a mandatory health warning, since it has ingredients like betel nut, a known carcinogen that is addictive. 

But celebrities are restricted from advertising plain pan masala because of explicit Advertising and Standards Council of India guidelines, which say that products bearing health warnings by law cannot be endorsed by them. Nonetheless, ads for cardamom seeds, such as those done by Amitabh Bachhan and Hrithin Roshan, are seen as surrogate for tobacco products or pan masala bearing the same brand name.

Established in 1985, the ASCI is a voluntary self-regulatory organisation with members from marketing, media, and allied companies.

It has laid out the criteria for what constitutes a genuine brand extension and not a surrogate advertisement for tobacco and liquor products. 

In January this year, it banned surrogate ads of 12 liquor companies after they failed to convince these were genuine extensions. 

In May this year, ASCI issued strict guidelines to crack down on surrogate ads. The rules state that the product sold under the brand extension that has been present in the market for less than two years must have a turnover of Rs 20 lakh per month or demonstrate fixed asset investment of at least Rs 10 crore.

If the brand has been present for more than two years, its annual turnover should be Rs 5 crore nationally or Rs 1 crore per state where distribution has been established. The numbers must be validated by an independent agency or a CA firm. 

The Ministry of Information and Broadcasting last year advised that surrogate advertisements be previewed and certified by the Central Board of Film Certification (CBFC) before they are allowed for public viewing on television. The law prohibits surrogate advertisements while allowing ads of genuine brand extensions, subject to certain conditions. 

While celebrities in some rare cases may stop doing surrogate ads due to public uproar, the government can re-examine the law in this area, as such ads defeat the very purpose of the advertising ban on tobacco and liquor. Despite multiple layers of prohibition, surrogate ads are only thriving, as evidenced by their presence in mega events like the Indian Premier League.

First Published: Oct 21 2021 | 12:40 PM IST

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