Have you ever been unable to find the unsubscribe/delete button on a social media application? Added an item to your shopping cart only to realize later that the price displayed to you initially was substantially lower than the check-out price? Were you forced to provide personal data to gain access to a website/application? These are all examples of unfair trade practices and misleading advertisements deployed by digital platforms to manipulate users, i.e., dark patterns.
The Advertising Standards Council of India ("ASCI") recently released a discussion paper on these dark patterns used by digital platforms which may cause harm to the users ("Discussion Paper"). As explained in the Discussion Paper, a dark pattern is a user interface, crafted to trick or manipulate users into making choices that are detrimental to their interest.
To prevent these practices, various regulators have taken notable steps. The European Data Protection Board ("EDPB"), for instance, has issued guidelines which provide best practice recommendations to designers and social media platform providers on how they can assess and avoid dark patterns in social media interfaces1. The Digital Services Act ("DSA"), a legislation proposed in the European Union, also seeks to address these issues. Under the DSA, providers of intermediary services would be restricted from using their online interface to impair the users' ability to make free, autonomous and informed decisions or choices.
In the United States, the Federal Trade Commission ("FTC") has been actively combating the use of dark patterns. The FTC has sued companies for requiring users to navigate a maze of screens in order to cancel recurring subscriptions, sneaking unwanted products into consumers' online shopping carts without their knowledge, using non-descript dropdown arrows or small icons to hide the full cost of products etc. A detailed report titled 'Bringing Dark Patterns to Light' discusses these measures2. An enforcement policy statement was also issued by the FTC which warned companies against deploying these practices3. At the State level, amendments to privacy laws such as the California Privacy Rights Act and the Colorado Privacy Act target dark patterns. Similar amendments to privacy laws have been introduced in other states. Moreover, legislations regulating dark patterns on online platforms have also been introduced in other jurisdictions.
In the Discussion Paper, the ASCI has outlined the following key practices that it intends to address through expanding its existing code on misleading advertisements:
- Bait and Switch: When an advertisement directly or indirectly implies one outcome based on the consumer's action, but instead serves an alternative outcome, the same would be considered misleading. For example, a consumer may select a product offered at a certain price but is thereafter only able to access products at a higher price. Another example is offering an attractive product and later revealing that it is out of stock, offering an alternative product.
- False Urgency: Stating or implying that quantities of a particular product are limited than they actually are. For example, while booking an airline ticket, users are informed that limited seats are left at the price shown. This creates a sense of urgency to make an immediate decision, and in some cases, this may not be a true reflection of seat availability.
- Drip Pricing: Only a part of a product's price is disclosed to potential buyers including elements that have to be borne by customers, for example tax. The total price is only revealed at the very end of the buying process, thereby creating ambiguity around the final price as well as preventing easy price comparisons.
ASCI Recommendation: Quoted prices must include non-optional taxes, duties, fees and charges that apply to all or most buyers.
- Disguised Advertising: Advertisements that are disguised as other kinds of content or navigation, to attract customers. Examples could be influencer posts, paid reviews, and advertisements placed in a manner to appear like content. In 2021, ASCI asked social media influencers to disclose promotions, in order to address the issue of disguised advertisements.
ASCI Recommendation: An advertisement that is of a similar format as editorial or organic content must clearly disclose that it is an advertisement.
It is relevant to note that the Central Consumer Protection Authority, in June 2022, issued the "Guidelines for Prevention of Misleading Advertisements and Endorsements for Misleading Advertisements, 2022" to curtail similar misleading advertisements. While not all dark patterns fall under the domain of advertising and may be out of the ASCI's remit, they could amount to unfair trade practices which compromise consumer interest. Some of these dark patterns described in the Discussion Paper are the following:
- Privacy: Interfaces that trick users into sharing more information than is needed.
- Confirm-shaming: Using shame to drive users to act. For example, when websites use words that induce shame or guilt to describe the options that consumers wish to exercise, such as declining to sign up for newsletters.
- Checkbox Treachery: Obfuscatory checkboxes, usually in the form of opt-in or opt-out checkboxes that businesses use to give customers notional control over how their contact data is used.
- Nagging: Repeatedly asking users for the same thing. There is often no option to make it stop, with the hope of eventually breaking users and getting them to agree to sharing data or agreeing to unfair terms.
- Sneak-in Basket: When consumers purchase something, additional products are added into the basket of the consumer, without their knowledge.
The ASCI hopes that, such dark patterns will be appropriately addressed by regulators in India in the interest of consumer protection. Use of dark patterns may also be addressed by competition law to the extent that they are used by dominant entities in India. Therefore, the consumer, data protection and antitrust authorities may already have the means to address dark patterns. However, with emerging technologies offering novel ways of engaging with customers, specific laws need to be developed which cover all forms/methods in which such dark patterns could emerge on digital platforms.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.