Ban on Tobacco Ads by the Government of India

            

Details



Themes: Ethics in Business
Period : 1981-2001
Organization : Indian Tobacco Company Philip Morris
Pub Date : 2001
Countries : India
Industry : Food, Beverages & Tobacco

Buy Now


Case Code : BECG002
Case Length : 8 Pages
Price: Rs. 300;

Ban on Tobacco Ads by the Government of India | Case Study



"We should have no illusions about the seductive power of modern marketing techniques as a factor in why children and adolescents take up Smoking. This is an area where Governments have an especially important role to play..."


- Carol Bellamy, Executive Director, UNICEF.

"From an ethical standpoint, it would be wrong to try to cause people to take the risk of smoking. But even beyond the moral issue, for a product such as cigarettes well known to have serious health risks, it would be difficult even to understand how an advertising campaign could be devised to convince people to smoke."


- Brown & Williamson Tobacco Corporation.

Ban on Tobacco Ads by the Government of India: Introduction

On Feb 6, 2001 Government of India (GOI) dropped a bombshell on the tobacco Industry when it announced that it would shortly table a bill banning Tobacco Companies from advertising their products and sponsoring sports and cultural events. The objective of such a ban was to discourage adolescents from consuming tobacco products and also arm the Government with powers to launch an anti-Tobacco Program.

This decision seemed to have sparked an intense debate, not just over the ethical aspects of Government's moral policing but also over the achievability of the objective itself. Reacting strongly against the proposed ban, Suhel Seth, CEO, Equus Advertising said, "The ban does not have teeth. It is a typical knee-jerk reaction by any Government to create some kind of popularity for itself.

The Legislation has not been thought thorough". In its reaction to the GOI's decision, ITC Ltd1. announced that it would voluntarily withdraw from all of the sponsorship events, irrespective of the legal position on the subject.

In a statement it said, "ITC believes that this action on its part will create the right climate for a constructive dialogue that will help develop appropriate content, rules & regulations to make the intended legislation equitable and implementable". The complexity of the issue was that, the issue involved the tussle between the ethical and commercial considerations. On the one hand, was tobacco, the most dangerous consumer product known, which killed when used as the makers' intended. Therefore from an ethical standpoint, the Government had to discourage the habit, as it was responsible for the welfare of its citizens.

On the other hand, the tobacco Industry was a major contributor to the State Exchequer (In the Year 2000-01 it contributed about Rs. 8000 crores in excise revenue) which was extremely important, given the financial crunch which it faced. In the light of the above statements, what approach should the government choose-the ethical or commercial and is it proper for government to interfere in matters of personal choice in the first place? To make the matter more complex, there was the question- was the objective achievable at all and was it equitable? The answers to these questions lay in understanding the viewpoints of both sides-those in favour and those against such bans.

The Ayes'

The ban was not unusual keeping in view the international precedents. Countries like France, Finland, and Norway had already imposed similar bans. Advocates of free choice opposed to these bans, saying these amounted to unwarranted intrusion by the state in the private lives of its citizens. But, others pointed out that the state had the right to intervene in the overall interest of the citizens. They cited the example of drugs like cocaine, which was, banned the world over.

In 1981, the Supreme Court (of Appeal) in Belgium gave its ruling that a ban on tobacco advertising was not unconstitutional. In 1991 the French Constitutional Council declared that the French ban on advertising tobacco products was not unconstitutional as it was based on the need to protect public health and did not curtail the freedom of trade. There were many precedents of restrictions being imposed on the advertising of dangerous or potentially dangerous products even if these products remained in the market (e.g. firearms, pharmaceutical Products).

Next >>


1] ITC was one of the biggest spenders on advertising spending about Rs. 185 crores (The tobacco industry on the whole, spent about Rs 276 crore in Year 2000) It was actively associated with various sports events. It sponsored the 1996 World Cup cricket tournament. The company promoted horse racing in India by sponsoring many Derby Classics. ITC extensively used cultural events to promote its brands across the country. ITC also sponsored stalls for Durga Pooja in West Bengal, Ganesh Pooja in Maharashtra, and for similar, popular festivals in other parts of the country.