Government plans to tighten noose around surrogate ads promoting liquor makers such as Carlsberg, Pernod: Report

The Union government is planning to announce new laws, which will bar surrogate ads and sponsoring of events by liquor firms such as Carlsberg, Pernod Ricard and Diageo, Reuters reported. 

Under the new laws companies could be fined and celebrities may face bas for endorsing tobacco and liquor ads which are deemed misleading, the Reuters report said citing a top official from the consumer affairs department. 

The new draft rules prohibit marketing of items such as soda or music CDs employing a “similar label, design, pattern, logo” to that of alcohol products, explicitly targeting efforts to get around current bans, it added. 

Business Today was unable to verify the report independently. 

Surrogate ads get round prohibition guidelines by ostensibly showing less-desirable items such as water, music CDs or glassware featuring logos linked to their key products and often promoted by popular film stars. 

The final rules were expected to be issued within a month, the Reuters report said. 

The new rules may have an impact on the liquor sales in India, the world’s eighth-biggest alcohol market by volume with annual revenue estimates at $45 billion. 

Growing affluence makes India a lucrative market for liquor makers United Breweries, part of the Heineken Group, which has more than a quarter of market share by volume. Popular for their whiskies, Diageo and Pernod, taken together, have a market share of about a fifth, while for Pernod, India contributes about a tenth of global revenues. 

Penalties under the new rules rely on consumer law, opening manufacturers and endorsers to fines of up to Rs 50 lakh, while promoters risk endorsement bans running from one to three years. 

According to the World Health Organization (WHO) bans or comprehensive curbs on alcohol advertising “are cost-effective measures” in the interest of public health. 

India’s consumption of alcohol per person will rise to nearly 7 litres in 2030, from about 5 litres in 2019, a period over which fellow Asian giant China's consumption will drop to 5.5 litres, as per WHO data. Alcohol-related deaths in India stood at 38.5 for every 100,000 of its population, versus 16.1 for China. 

Countries such as Norway, which bans ads for alcohol and other goods relying on features of a liquor brand, have seen a cut in alcohol sales over time, according to experts.