In a recent decision (6 W 72/12), the Brandenburg Higher Regional Court held that the regulations under competition law (Section 5a (3) (2) of the Law Against Unfair Competition) require the address of the registered office of the company to be included in all directly product-related advertising.
In the adverts, which introduced specific products and stated prices, a company gave its name and the address of four branches. The legal registered office was at a fifth address, but this was not given in the advert.
While the Regional Court deemed the giving of branch addresses to be sufficient, the Higher Regional Court overturned this and adjudged that adverts of this kind should be ceased.
Section 5a (3) (2) of the Law Against Unfair Competition entered German competition law in the course of implementation of the European directive on unfair commercial practices. It required that the identity and address of the company should be given where specific goods or services were offered, and a price stated, in such a way that a purchaser could make decision to purchase.
The regulation therefore does not apply to image publicity that does not involve the advertising of specific products. However, as soon as products and prices are advertised the full (legal) company name and corporate form etc. must be stated together wi t h the address of the company's registered office. In the opinion of the Brandenburg Higher Regional Court it is also not sufficient, for example, to give details of a website or comparable references enabling consumers to gain information on the company's identity.
The decision is dangerous because competition associations and serial litigators will target their searches to find advertising that, for example, only specifies the company slogan or branch addresses and therefore lacks the required details.
In addition to this there are numerous further pitfalls in Section 5a (3) of the Law Against Unfair Competition, which are often not observed and are also potentially explosive.
Law Against Unfair Competition: Section 5a – Misleading by omission
(1) In assessing whether the concealment of a fact is misleading, consideration shall be given in particular to its significance for the transactional decision according to prevailing public opinion, as well as to the suitability of the concealment for influencing the decision.
(2) Unfairness shall have occurred where a person influences a consumer's ability to take a decision, being a consumer within the meaning of Section 3 subsection (2), through omission of information that is material in its factual context, taking account of all its features and circumstances, including the limitations of the communication medium.
(3) Where goods or services are offered with reference to their characteristics and price in such manner appropriate to the communication medium used that an average consumer can conclude the transaction, the following information shall be deemed to be material within the meaning of subsection (2) if not already apparent from the context:
1. all main characteristics of the goods or services to an extent appropriate thereto and to the communication medium used;
2. the identity and the geographical address of the entrepreneur and, where applicable, the identity and geographical address of the entrepreneur on whose behalf he is acting;
3. the final price, or in cases where the nature of the goods or services means that such price cannot be calculated in advance, the manner in which the price is calculated as well as, where appropriate, all additional freight, delivery or postal charges or, where these charges cannot be calculated in advance, the fact that such additional charges may be payable;
4. arrangements for payment, delivery and performance, as well as complaint handling policies so far as they depart from the requirements of professional diligence; and
5. the existence of a right of withdrawal or cancellation.
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.
