Unfair competition law deals with illicit marketing practices. Across the EU, it is now harmonised to some extent, by Directive No. 2005/29/EC, although member states can – and do – make use of maneuvering mass accorded to them for autonomous legislation.
A key feature of unfair competition law is that competitors may bring injunctive claims (to cease-and-desist judgments) without the need for them to prove any monetary damages. Under German law, these claims can, in many cases, be pursued through ex parte interim relief proceedings. Whether or not a claimant is a “competitor” can be a trying question, in particular in the case of so-called substitute products.
Annex I to Directive No. 2005/29/EC contains a “black list” of commercial practices “which are in all circumstances unfair”. Some practically relevant examples include:
- “Falsely stating that a product will only be available for a very limited time, or that it will only be available on particular terms for a very limited time, in order to elicit an immediate decision and deprive consumers of sufficient opportunity or time to make an informed choice” (no. 7),
- “Presenting rights given to consumers in law as a distinctive feature of the trader’s offer” (no. 10),
- “Using editorial content in the media to promote a product where a trader has paid for the promotion without making that clear in the content or by images or sounds clearly identifiable by the consumer (advertorial)” (no. 11)
- “Including in marketing material an invoice or similar document seeking payment which gives the consumer the impression that he has already ordered the marketed product when he has not”. (no. 21)
- “including in an advertisement a direct exhortation to children to buy advertised products or persuade their parents or other adults to buy advertised products for them” (no. 28).
This said, the majority of cases tried in the courts are not on this non-exhaustive black list. As a matter of fact, in certain jurisdictions, including Germany, any illegal business practice can constitute unfair competition and give rise to corresponding claims. An example is the use of General Terms and Conditions not in line with their regulatory framework.
Unfair competition is particularly relevant in advertisement law, although its scope is wider than that, and basically includes any business activities geared towards the market.
BODENHEIMER Representative Matters as Parties’ Counsel
Advised a Turkish app developer on litigation avoidance strategies with regard to alleged breach of contract claims put forward by a U.S. marketing platform
Advised and represented a French marketing agency in injunction proceedings before the German courts brought by a German activist on e-mail marketing practices
Represented a German shipyard in interim relief proceedings against a competitor in a product piracy matter
Represented a shipyard in product piracy litigation before the German state courts (including interim relief applications) against companies involved in the interior design of a yacht
Advised a multinational online media agency on a set of contracts for a novel, innovative mobile marketing technology, involving mobile network operators, original end manufacturers, and distributors
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