The Advertising Regulatory Board (ARB) ruled that a Jetour Dashing television advertisement was misleading because it failed to disclose essential financing details like deposits and repayment periods. While the ARB lacks direct jurisdiction over non-member companies like Jetour South Africa, it has instructed media owners and broadcasters to refuse future advertisements from the brand that do not explicitly disclose all necessary payment terms.
Why is the ARB targeting monthly installment advertisements?
The ruling against the Jetour Dashing commercial highlights a regulatory crackdown on “low-entry” pricing models. According to the ARB, the advertisement claimed the vehicle was available “from R4,999 per month” but omitted the specific financial obligations required to reach that figure.
The complainant in the case argued that the advertisement prevented consumers from making informed decisions. Specifically, the ad failed to list:
- The required deposit amount.
- The residual value (the “balloon payment”) attached to the finance deal.
- The total repayment or lease period.
- Other material terms that dictate the true cost of the vehicle.
The ARB concluded that these omissions violated Clause 4.2.1 of the Code, which prohibits misleading consumers through the lack of material information. It also breached Clause 11.3, which specifically regulates motor vehicle advertising by requiring clear disclosure of lease and rental terms.
How can non-member brands be regulated?
A significant trend emerging from this ruling is the use of “gatekeeper” regulation. Because Jetour South Africa is not a member of the ARB, the regulator cannot directly fine or compel the company to change its behavior.
However, the ARB maintains influence through its members, which include major broadcasters, publishers, and advertising agencies. The Board issued an instruction to these members to refuse any future Jetour South Africa advertisements that promote finance offers without full disclosure. This creates a practical barrier for non-compliant brands, as they may find themselves unable to secure airtime or digital placements on major media platforms.
This approach sets a precedent for how regulators might handle global brands that operate in local markets without joining industry self-regulatory bodies. Instead of chasing the brand, regulators target the infrastructure that allows the brand to reach the public.
What are the risks of using “Terms and Conditions Apply” disclaimers?
The Jetour ruling establishes that generic disclaimers are no longer a legal shield against claims of misleading advertising. The ARB stated that a statement such as “T’s and C’s apply” is insufficient to cure the omission of vital financial data.
Industry experts suggest that the era of “hidden costs” in automotive marketing is closing. The trend is moving toward “Total Cost of Ownership” (TCO) transparency. Advertisers are increasingly expected to ensure that a consumer can understand the true nature of a finance offer from the advertisement itself, without needing to hunt for a fine-print document.
Comparison: Traditional vs. Compliant Advertising
| Feature | Traditional/Misleading Approach | ARB-Compliant Approach |
|---|---|---|
| Primary Focus | Lowest possible monthly payment | Full cost of ownership |
| Disclaimers | Generic “T’s and C’s apply” | Specific, prominent financial terms |
| Key Details | Omitted deposits and residual values | Explicit deposit and repayment periods |
Frequently Asked Questions
What happens if a company ignores an ARB ruling?
While the ARB cannot fine non-members, it can instruct media owners and agencies to stop running the brand’s non-compliant advertisements. This effectively cuts off the brand’s ability to use mainstream media to promote those specific offers.
Why is the residual value important in car finance?
The residual value is the amount left to pay at the end of a finance agreement. If this is not clearly disclosed, a consumer might believe they are paying off the full car each month, only to face a massive “balloon payment” at the end of the contract.
Does this ruling affect all car advertisements?
The ruling specifically targets advertisements that promote finance, lease, or rental arrangements. Any ad that mentions a monthly cost must provide the context of the deposit, interest, and term length to remain compliant with the Code of Advertising Practice.
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