Final version (July 21, 2004)
LIDC - 2004
Question A: Comparative Advertising
Which framework for the regulation of comparative advertising?
SUMMARY REPORT
International Rapporteur:
Dr. Gusztáv Bacher, attorney-at-law
SZECSKAY LAW FIRM – MOQUET BORDE (Hungary)
gusztav.bacher@szecskay.hu
___________________________________________________________________________
I.
II.
III.
INTRODUCTION
ISSUES RELATING TO THE LEGALITY OF COMPARATIVE ADVERTISING
1.
Legal framework for the applicable rules on comparative advertising
1.1 Sources of law
1.2 Area of law
1.3 Interests to be protected
1.4 Justification of specific rules
2.
Definition of comparative advertising
2.1 Legal definition
2.2 Methods of identifying the competitor
2.3 Advertisements claiming superiority
3.
Conditions for lawful comparative advertising
3.1 Admissibility of comparative advertising in general
3.2 The criteria for objective comparison
3.3 The criteria for the same need/same purpose of goods
3.4 Misleading nature of the comparative advertisements
3.5 Creating confusion with the competitor in the comparative advertising
3.6 Discrediting or denigrating the competitor
3.7 Price comparison
3.8 Further criteria for the admissibility of comparative advertisement
3.8.1.
Provisions of the national law
3.8.2
Provisions of self-regulatory code of conducts
3.9 The concept of the EU Commission’s Proposed Directive on the misleading nature of an
advertisement
4.
Use of competitor’s trademarks or trade names
4.1 Conflict between trademark law and the need to refer to the competitor’s trademark in the
comparative advertising
4.2 Limits of the use of third party’s trademark
4.2.1
Taking unfair advantage of third party’s trademark
4.2.2
Limitation of use to the word format of the trademark
4.3 The use of a third party’s other intellectual property rights (i.e., design, copyright)
5.
Designation of origin
6.
Burden of proof
7.
Self-regulatory code of conducts
7.1 Types of self-regulatory code of conducts and their binding nature
7.2 Professional organizations and EU antitrust regulation
7.3 Special rules applicable to comparative advertising in self-regulatory code of conducts
8.
Comparison made by third parties
8.1 Test comparisons
8.2 The use of test result in comparative advertising
9.
Enforcement of claims against unpermitted comparative advertising, cross-border
advertising
EVALUATION, HARMONIZATION
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The present summary report is prepared on the basis of the national reports received from the
working groups in the following countries:
COUNTRY/GROUP
Austria
NATIONAL REPORTER
Dr. Peter Pöch
Mag. Melanie Gufler
Belgium
Laurent de Brouwer
Françoise Jacques de Dixmude
France
Maître Jean-Jacques Le Pen
Germany
Prof. Dr. Helmut Köhler
Hungary
Dr. Alexander Vida
Italy
Avv.Vincenzo Franceschelli
Spain
Raul Bercovitz
Switzerland
Dr. Dominique Junod Moser
The Netherlands
Erik Vollebregt
United Kingdom
Katherine Tsang
United States
John M. Richardson
I would like to thank all the National Reporters who have contributed for their excellent and
comprehensive reports on the state of play in their respective jurisdictions. The reports
demonstrate a high level of knowledge and interest in the issues raised by this question.
No reports have as yet been received from Brazil and Japan. The lack of written reports from
these countries is regrettable considering that due to this situation the summary report below
is based only on the national laws of certain EU Member States, Switzerland and the U.S.
However, the review of the applicable laws of those countries outside Europe is also essential
and indispensable in order to assess the problems of further harmonization on a worldwide
level. The special point of view from countries outside the EU would therefore be of
particular significance in order to be able to present a well-balanced overview. Therefore, I
kindly ask the national reporters of those countries to present their national laws during the
Budapest discussions.
I.
INTRODUCTION
With regard to the circumstance that the present summary report will be read by a broader
scope of LIDC members than the National Reporters already participated in the project, it
seems to be justified to reiterate the basic assumptions and preliminary remarks on which the
extensive questionnaire was based.
2
A.
Comparative advertising, as a special form of advertising, is a sales promotion device
that compares the products or services of one undertaking with those of another, or
with those of other competitors.
Objective comparative advertising improves the quality of information available to
consumers enabling them to make well-founded and more informed decisions relating
to the choice between competing products/services by demonstrating the merits of
various comparable products. In this way, comparative advertising can also stimulate
competition between suppliers of goods and services to the consumer's advantage.
All comparative advertising is designed to highlight the advantages of the goods or
services offered by the advertiser as compared to those of a competitor. In order to
achieve this objective, the message of the advertisement must necessarily underline
the differences between the goods or services compared by describing their main
characteristics. The comparison made by the advertiser will necessarily flow from
such a description.
In business, the constitutional (fundamental) principle regarding freedom of speech is
inextricably intertwined with the freedom of advertising.1
However, comparisons between goods and services of different undertakings carry
with them some significant risks. There is a danger that once undertakings address the
merits and inadequacies of competing goods or services, they may be tempted to
denigrate them or derive unfair advantages from such inaccurate comparisons. Just
like traditional forms of advertising, comparative advertising seeks to both assist the
development of the undertaking concerned and to inform consumers. Although both
forms of advertising seek to attract customers, in case of comparative advertising,
commercial relationships may be exposed to the constant threat of unfair practices. It
is therefore difficult to dispute the necessity for all comparative advertising to be
subject to comprehensive and straightforward legal rules, laying down strict
requirements based on considerations of good faith and fair practices in commercial
relationships.
Indeed, the very nature of comparative advertising affects the interests of consumers
as well as the interests of competitors and, in this way, those of the general public.
B.
While in the United States comparative advertising has been a well-recognized and
acceptable form of advertising, the majority of European countries have been hostile
to such advertising for a long time and this form of advertising was considered as a
per se unfair market practice.
Only recently, following the adoption of Directive 97/55/EC of the European
Parliament and of the Council of 6 October 1997 was the introduction of comparative
advertising into the national legal systems of all EU member states (hereinafter: the
1
Pursuant to Article 10 of the European Convention on Human Rights (Rome, 1950), every person has
the right to freedom of expression. This right shall include freedom to hold opinions and impart information and
ideas without interference by public authority. The exercise of these freedoms, since it carries with it duties and
responsibilities, may be subject to such formalities, conditions, restrictions or penalties as are prescribed by law
and are necessary in a democratic society .. for the protection of the reputation or the rights of others. (This
limitation has an important role in case of comparative advertising.)
3
"Directive 97/55") accepted as a matter of principle; however only subject to very
strict conditions as to the circumstances in which such advertising would be permitted.
To this end, Directive 97/55/EC amended Directive 84/450/EEC concerning
misleading advertising so as to include comparative advertising (hereinafter: the
"Directive") on the basis of the consideration that the acceptance or non-acceptance of
comparative advertising, in the various national laws, may constitute an obstacle to the
free movement of goods and services and create distortions vis-à-vis of competition;
therefore, the freedom to use comparative advertising should be assured.
The European Court of Justice (ECJ) and the Court of First Instance have interpreted
the meaning of certain provisions of the Directive in three cases: (i) Case C-112/99,
Toshiba Europe GmbH v. Katun Germany GmbH, 25 October 2001; (ii) Case C44/01, Pippig Augenoptik GmbH & Co. KG v. Hartlauer Handelsgesellschaft mbH, 8
April 2003, and (iii) Case T-144/99, Institute of Professional Representatives before
the European Patent Office v Commission of the European Communities.
C.
LIDC has already dealt with the issue of comparative advertising: in 1980, LIDC
adopted a resolution on comparative advertising, and in 1994, at the Congress of
Berlin, LIDC adopted the resolution on the harmonization of the laws relating to
unfair competition including the principles to be taken into account in the course of
using a third party's trademark in comparative advertising.
D.
The harmonization of advertising standards is important because companies make
large expenditures for their advertising campaigns, and, in particular, multinational
companies may desire to use in all the countries where they do business identical
advertisements (except with respect to the language and elements which may run
against national morals and culture). Comparative advertising, when truthful and nondeceptive, is a source of important information to consumers and may assist them in
making rational purchasing decisions. Thus, comparative advertising may encourage
product improvement as well as innovation, and can lead to lower prices in the
marketplace.
Therefore, the carrying out of a detailed survey regarding the national laws relating to
comparative advertising and adopting a resolution relating to the harmonization of
requirements is both justified and timely.
A further reason for carrying out such survey was that the previous surveys in this
field had been carried out before the adoption of the Directive 97/55 or shortly after its
adoption. As the result of such research, the WIPO issued its comparative law
publication entitled - Protection Against Unfair Competition (Geneva 1994). Within
the framework of LIDC's work, the study of Michael Golding and David Latham shall
be referred to (Revue 1./1997). In 1998, at the Congress in Rio, the AIPPI dealt with
the question of comparative advertising, and in particular, with the issue of the
impairment of goodwill or disparagement resulting from same (Question 140).
It is time to analyze the experiences and practices which have emerged in recent years
under the new rules and the new interpretation of the requirements for comparative
advertisements. The proposed amendment of the Directive by the European
Commission may provide an opportunity for these proposals to fine-tune the present
rules.
4
With respect to the goal of further harmonization on a worldwide level, it should be
stated that the WIPO Model Provisions on Protection Against Unfair Competition
(1996) does not deal with the issue of comparative advertising, although its inclusion
would have been appropriate.
It is in this context that LIDC decided to place the Question of comparative advertising onto
the agenda of the Budapest Congress of 2004.
II.
ISSUES RELATING TO THE LEGALITY OF COMPARATIVE ADVERTISING
1.
LEGAL FRAMEWORK FOR THE APPLICABLE RULES ON COMPARATIVE ADVERTISING
1.1
Sources of law
In the continental European countries, the rules on comparative advertising are based on
statutory law, although the interpretation and construction of such rules have been developed
by the court practice. In addition to these statutory rules, there are professional codes and
industry self-regulation rules relating to comparative advertising (See Section 7 below).
Further, in certain countries (Spain), an extensive practice has evolved on the basis of
arbitration awards rendered by such self-regulated association. In the UK, the rules on
comparative advertising are a mixture of statutory law and case law constituting a threelayered system comprising: (i) legislation creating a system of civil and criminal actions
regulating advertising; (ii) case law/common law prohibiting advertising that constitutes
malicious falsehood; and (iii) self-regulation by virtue of various codes. There is specific case
law in the area of malicious falsehood which addresses comparative advertising.
On the basis of the national reports received, it can be concluded that all the EU countries
have implemented the Directive in their legal systems, with essentially identical criteria set
forth in the Directive. However, in certain countries (Austria), the legislator seemed reluctant
to regulate the conditions on comparative advertising in a more detailed way. In particular, the
conditions for comparative advertising as mentioned in Article 3a (1) of the Directive were
not expressly incorporated in the statutory law: the newly introduced provision on
comparative advertising states – on a general basis - that comparative advertising must
comply with the rules of “unfair competition” (i.e., general clause, misleading acts,
disparagement of an enterprise and misappropriation of business designations). Because of the
previous extensive court practice, the Austrian national reporters do not consider that the
Austrian courts will have any difficulties with such a “short” implementation of the Directive.
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1.2
Area of law
The national reports indicate that the rules on comparative advertising belong to different
areas of law.
The majority of the national reports indicate that the rules on comparative advertising are part
of the unfair competition law (Austria, Germany, Italy, the Netherlands, Switzerland), and
there are specific provisions applicable to comparative advertising in addition to the general
rules of unfair competition. However, the Dutch report indicates that the provisions do not
apply in addition to general rules on unfair competition but they are a lex specialis of the
general tort provision.
Further, under the Hungarian and Spanish law, there are rules on comparative advertising both
within the unfair competition law and within the advertising law which is - in this respect - of
an administrative law nature. When both fields of law are invoked before a court, the Spanish
jurisprudence has established that the advertising law must prevail in case of any conflict or
contradiction. However, both regulations are quite homogeneous.
Moreover, in Spain, once an act of illegal comparative advertising is adjudicated, the
advertising law provides that such act may be also considered an infringement of the
consumer protection law. But this is only for the purpose of imposing administrative fines or
sanctions on the infringer. The consumer protection law does not have provisions allowing for
an assessment of the existence of an act of illegal comparative advertising.
In France, the rules on comparative advertising belong to the framework of consumer’s
protection; however, the criteria determining the legality of the comparative advertising refer
also to other areas of law, namely to competition law, unfair competition law, advertising law
and trade mark law. In Belgium, the legislation implementing the Directive 97/55 belongs to
both unfair competition law and consumer protection law.
In the UK, the rules belong to various areas of the law ranging from trade mark infringement
(including passing-off), to unfair competition2, to consumer protection, to advertising law.
Exclusively, the British report referred to the possibility of criminal sanctions.
In the U.S., the right to “commercial” speech has been recognized by the Supreme Court as
being protected by the First Amendment to the U.S. Constitution but with presently less than
the full scope of the protection of freedom of speech as to political and social issues of public
concern. The core value being protected by this constitutional rule is the right of access to
truthful information about lawful commercial activities, which, in context, is not misleading.
There is no constitutional value in untrue or deceptive speech. State regulation must be based
on a substantial interest, the regulation must directly related to that interest, and there must be
proportionality in the scope of the regulation.
2
The British reporters note that this refers to the general concept of unfair competition, not the cause of
action of unfair competition that is available in some countries on the European Continent.
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1.3
Interests to be protected
Irrespective of the fact as to which area of the law governs comparative advertising, the
interests to be protected simultaneously are the following:
(i)
(ii)
(iii)
(iv)
the protection of competitors;
the protection of proprietary rightholders (i.e., trademark, trade name);
the protection of consumers; and
the protection of the general public interest in undistorted competition3.
Generally speaking, comparative advertising should enable advertisers to objectively
demonstrate the merits of their products. Based on this objective information, consumers may
make informed and therefore efficient choices. Comparative advertising which aims to
objectively and truthfully inform the consumer promotes the transparency of the market.
Market transparency is also deemed to benefit the public interest as the functioning of
competition is improved resulting in keeping down prices and improving products.
The British reporter observes that there is no one authoritative statement that sets out the
principles of the UK system or the interests that are to be protected although the underlying
aim would appear to be that of fair trading, and further that regard should be had to the
interests of all concerned - in particular - the public interest. This is tempered with a
recognized need to safeguard the interests of owners of registered trade marks.
1.4
Justification of specific rules
The national reporters agree that specific conditions should be set forth for comparative
advertisements in addition to the general rules of unfair competition.
Comparative advertising is a legitimate means of informing consumers of the advantage of the
product / service compared with that of a competitor. In order to guarantee that it fulfils this
objective, comparative advertising must be used in a fair manner.
Due to the special characteristics of comparative advertising, namely the direct or indirect
reference in the advertising to identifiable competitors, it is important to protect the interests
of such competitors as well in order to prevent (i) disparagement, or (ii) taking of unfair
advantage of the competitor's reputation. This consideration justifies the application of the
general rules on unfair competition very thoroughly and – where necessary – the application
of special conditions that comparative advertising should comply with in order to ensure that
disparagements of competitors be prevented.
It is important to determine which practices relating to comparative advertising may distort
competition, be detrimental to competitors and have an adverse effect on consumer choice. In
particular, it is important to establish special criteria for objective comparisons and rules with
regard to the possibility to compare products and services. Thus, relying on the general rules
for unfair competition does not provide sufficient legal certainty and leaves too wide a scope
3
It cannot be established on the basis of the national reports whether in case of comparative
advertisements, the protection of the general public interest in undistorted competition constitutes an
independent interest to be protected or this is an aggregate result arising from the protection of consumers and
competitors.
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for divergence of national laws and jurisprudence which would hinder cross-border trade. It is
for further discussion how precisely such criteria can be established in the law.
2.
DEFINITION OF COMPARATIVE ADVERTISING
2.1
Legal definition
Pursuant to Article 2a. of the Directive, “comparative advertising means any advertising
which explicitly or by implication identifies a competitor, or goods or services offered by a
competitor.”
Thus, only the comparison made for commercial purposes falls under the scope of
comparative advertising, as the French reporter emphasizes. Consequently, comparisons
(tests) made by third parties (i.e., consumer organizations) to provide information to the
public does not constitute a comparative advertisement provided it does not promote any
goods or services (See Section 8).
The definitions in the national laws of EU countries are identical or nearly identical to that of
the Directive. The definition in the UK's law on point, however, in view of the British
reporter, may broaden the scope of the definition by indicating that the identification of the
competitor, either explicitly or by implication, can be effectuated “in any way”.
The Swiss law does not contain a definition of comparative advertising, and the Swiss
reporter points out that the jurisdiction limited itself to a very superficial attempt at defining
it: comparative advertising refers to competitors. Thus, the notion of comparative advertising
is construed broadly, and entails - contrary to EU law - comparative tests made by third
parties (see Section 8.1).
Recital (6) of the Directive 97/55 sets forth that it is desirable to provide a broad concept of
comparative advertising in order to cover all types of comparative advertising. To this end,
the ECJ held that in order for there to be comparative advertising within the meaning of
Article 2a. of Directive, it is sufficient for a representation to be made in any form which
refers, even by implication, to a competitor or to the goods or services which he offers.
Therefore, if the competing products are merely referred to within the advertising, it in itself
constitutes an instance of comparative advertising and it is irrelevant whether an actual
comparison is made between the goods and services offered by the advertiser and those of a
competitor (see C-112/99, Toshiba, para 31.).
2.2
Methods of identifying the competitor
There are several different ways to identify a competitor in a comparative advertisement or,
even if the competitor's name is not mentioned, its product. Such reference can be made
directly or indirectly, by implication or insinuation.
As the national reports point out, any reference made to the competitor or its product,
explicitly or implicitly, is considered to be comparative advertising. It is not required to
expressly mention the name of the competitor in the comparative advertising. However, it
must be clear that the competitor is affected by the statement; therefore, such reference must
be clear and unmistakable, and must establish in any manner a link between the goods or
services of the advertiser and the goods or services of one or more competitors.
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Under Swiss law, comparative advertising may refer to an indeterminate number of
competitors. Pursuant to UK case law, regarding implied references to a competitor, case law
suggests that where an expression is such that it can only be construed as referring to one
competitor, that is likely to amount to identifying that one competitor.
A competitor is recognizable directly if it is in particular mentioned in the comparison or
figuratively represented. To be covered by the scope of the definition, it is also sufficient, as
the German reporter indicates examples, if the competitor can be recognized indirectly, i. e.
on the basis of: (i) reference to the advertisement of the competitor, (ii) reference to business
circumstances of the competitor, (iii) direct or indirect group designations, or (iv) situation on
the relevant market. As such, in Austria, an advertisement claiming superiority was deemed to
include a reference to identifiable competitor(s), as the number of the advertiser’s competitors
on the relevant market was very small and could easily be managed. Further, if an undertaking
has a dominant position in the market, Belgian jurisprudence considers the comparative
advertising as a comparison with such dominant undertaking.
Hungarian legal literature (scholarly opinion) makes a distinction between so-called polarized
and unpolarized advertising on the basis of the circumstance that in the former specific
competitor(s) are identifiable, while in the later the comparison generally refers to the
competing products available on the market.
In all jurisdictions, it does not make any difference whether the comparison is direct or
indirect. Obviously, in cases of indirect comparison, it may be easier to prove that the
advertising does not constitute comparative advertising, since the implied reference to a
competitor, or to his goods, services must be clear enough for a standard (well-informed)
consumer and there is more room for interpretation for the courts in such types of cases. Thus,
the understanding of the respective target group of the advertising shall be taken into
consideration.
Austrian case law and doctrine have mentioned several kinds of “comparisons” that are
deemed outside the definition of comparative advertising. The definition of comparative
advertising clearly does not include comparisons of an advertiser’s own products. For
example, in a very recent decision, an advertiser promoted a dishwasher detergent by using
the phrase “one hundred per cent more washing power” while it compared its own product.
Further, so-called “instead of” price comparisons (the classic pattern is to say “instead of”
and cross out a higher price) which do not refer to an identifiable competitor are outside the
definition of comparative advertising. Although “instead of” prices were considered as a
special kind of price comparison, they were allowed if they were not misleading. There must
not be any doubt what the higher price was: the own price of the advertiser, a recommended
price of the producer, the average market price, etc. In addition, “abstract” comparisons
which do not refer to an identifiable competitor or product are also outside the scope of the
definition. Under Austrian law, so-called “system comparison” are considered as abstract
comparative advertising because they usually do not refer to an identifiable competitor or
product. Generally speaking, a system comparison aims at demonstrating the merits of
different means of distribution, production, application or functioning of products or services
(for example, the comparison between the system “tampon” versus the system “sanitary
towel”).
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2.3
Advertisements claiming superiority
Certain advertisements claim the superiority or uniqueness of the product (like "the best" and
use of other superlatives) which involves - without indicating any specific competitor - per se
a comparison with all other products of the same nature available on the market.
There is certain divergence among the jurisdictions examined as to whether advertisements
claiming superiority or uniqueness of the product fall under the scope of comparative
advertising, or such advertisements are subject to general rules (i.e., the prohibition of
misleading advertising).
In Switzerland and the UK, such advertisements constitute a form of comparative advertising.
In the Netherlands such advertisements may constitute a form of comparative advertising if
the public will interpret the advertisement as a reference to one or more specific competitors
rather than every other competitor in the market. The adjudications mentioned in the UK
report are based on the examination of whether the advertiser was able to show that the
statements in the advertising were true and not misleading. Under Swiss law, however,
advertising exaggeration, i.e. obtrusive praise that does not make sense, that is recognizable as
such and therefore not taken seriously by the public, and obtrusive exaggeration or advertising
resorting to value judgment do not fall within the ambit of the rules of comparative
advertising. They may however be unlawful if they amount to unnecessary disparagement. In
Italy, using superlatives in the advertising is considered as a kind of indirect comparison with
all market participants in the specific field of goods/services.
In contrast, in other countries (Austria, Belgium, France, Germany, Hungary, Spain)
advertisements claiming superiority or uniqueness of the product - which do not include a
reference to an identifiable competitor - are considered to be outside the definition of
comparative advertising, and they are subject to general rules. In particular, they must not be
misleading and aggressive tendencies should be avoided as well as global disparagements.
The Hungarian legal practice makes a difference between a comparative advertisement (with
a definition identical to that of the Directive) and an advertisement containing a comparison
(where no competitor can be identified). Considered as an advertisement containing a
comparison, the competition authority found the slogan “it removes easily the stain and scale
which other products leave” misleading because the product – according to the instruction of
use - could not be used on all surfaces in the bathroom and kitchen.
Further, the rules on comparative advertising will indeed apply to advertisements claiming
superiority or uniqueness if there are only very few competitors and it is clear who is affected
by a statement. For example, the Austrian Supreme Court came to this conclusion in a case
where the advertiser of a newspaper claimed to be “faster and more current” and there was
only one competing newspaper in the relevant market. On the other hand, in France, the use of
the slogan “No. 1 of newspaper advertisements” was not considered as a comparative
advertisement since the slogan did not refer, directly or indirectly, to any competitor
newspaper. However, the slogan was considered to be unfair.
It can be concluded that the admissibility of advertisements claiming superiority can be
subject either to specific rules on comparative advertising or to general rules (i.e., prohibition
of misleading). It seems to be desirable to apply the specific rules on comparative advertising
if it can be identified with which competitor the comparison is made and such specific
competitor can be regarded as the injured party.
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3.
CONDITIONS FOR LAWFUL COMPARATIVE ADVERTISING
3.1
Admissibility of comparative advertising in general
All national reports set forth that comparative advertising is generally permitted, however,
subject to certain circumstances set forth in the national law.
Comparative advertising is not expressly mentioned in Article 10bis of the Paris Convention.
However, it seems to be clear that comparative advertising should comply with restrictions
applicable to all advertisements: that is, it shall not cause confusion, mislead, or discredit a
competitor. Due to the special nature of comparative advertising, however, certain additional
requirements should be applied to this type of advertising (for the justification of such specific
rules see Section 1.4).
Since the overwhelming majority of national reports were received from EU Member States
(reports from jurisdictions outside the EU were received from Switzerland and U.S.), the
admissibility of comparative advertising will be examined in the light of the criteria set forth
in the Directive. Pursuant to Article 3(a)(1) of the Directive, comparative advertising shall, as
far as the comparison is concerned, be permitted when the following conditions are met:
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
it is not misleading;
it compares goods or services meeting the same needs or intended for the same
purpose;
it objectively compares one or more material, relevant, verifiable and representative
features of those goods and services, which may include price;
it does not create confusion in the market place between the advertiser and a
competitor or between the advertiser’s trade marks, trade names, other distinguishing
marks, goods or services and those of a competitor;
it does not discredit or denigrate the trade marks, trade names, other distinguishing
marks, goods, services, activities, or circumstances of a competitor;
for products with a designation of origin, it relates in each case to products with the
same designation;
it does not take unfair advantage of the reputation of a trade mark, trade name or other
distinguishing marks of a competitor or of the designation of origin of competing
products;
it does not present goods or services as imitations or replicas of goods or services
bearing a protected trade mark or trade name, and
any comparison referring to a special offer shall indicate in a clear and unequivocal
way the date on which the offer ends or, where appropriate, that the special offer is
subject to the availability of the goods and services, and, where the special offer has
not yet begun, the date of the start of the period during which the special price or other
specific conditions shall apply.
Recital (11) of the Directive provides that the above listed conditions for comparative
advertising should be cumulative and should be respected in their entirety. Further, the ECJ
held that the Directive carried out an exhaustive harmonization of the conditions under which
comparative advertising in Member States might be lawful. Such a harmonization implies by
its nature that the lawfulness of comparative advertising throughout the Community is to be
11
assessed solely by the criteria laid down by the Community legislation. Therefore, stricter
national provisions on the protection against misleading advertising cannot be applied to
comparative advertising with regard to the form and content of the comparison (Case C44/01, Pippig, para 44).
No national report indicated that there are additional criteria in the respective national law for
the admissibility of the comparative advertising. The Swiss report indicated the application of
almost the same criteria as well. However, there are certain further criteria applicable with
respect to certain goods / services or set forth in professional codes / industry self regulation
rules relating to comparative advertising (see Section 7 below).
No national report suggested that any further criteria should be added to those set forth above.
On the other hand, the U.S. Federal Trade Commission - in its statement of policy regarding
comparative advertising - evaluates comparative advertising in the same manner as it
evaluates all other advertising techniques. The ultimate question is whether or not the
advertising has a tendency or capacity to be false or deceptive.
Section 43(a) of the Lanham Act is a federal unfair competition provision which has been
very liberally interpreted by the federal courts with the result that it is the overwhelming
favorite of those seeking to prevent alleged acts of unfair competition. Section 43(a) of the
Lanham Act provides that "any person who, on or in connection with any goods or services . .
. uses in commerce any ... false or misleading description of fact, or false or misleading
representation of fact, which (B) in commercial advertising or promotion, misrepresents the
nature, characteristics, qualities, or geographic origin of his or her or another person's goods
... shall be liable in a civil action by any person who believes that he or she is or is likely to be
damaged by such act."
The US. Lanham Act contemplates a free market into which advertisers are not to inject false
or misleading information, but in which, as in any free market, it is up to the consumer to see
to it that only the product that best serves the consumer's needs is bought. If the competitor
believes consumers will make more optimal decisions if they consider information other than
that provided by advertiser, its solution is to augment rather than censor the available truthful
information.
On the basis of the national reports, the present summary below analyzes, both in the B2B and
in B2C aspects of comparative advertising: (i) how the courts interpret the criteria relating to
comparative advertising, and (ii) explores same and/or different requirements for comparative
advertisements to be permitted. (Please note that although included within the above
requirements, the criteria relating to the use of a third party's trademark and to the issue of the
same designation of origin will be examined under separate headings.)
3.2
The criteria for objective comparison
As a general rule, comparative advertising must be based on accurate data which is
objectively verifiable and true. The majority of national reports indicate that the comparative
advertising must objectively relate to:
-
material,
relevant,
12
-
verifiable,
true, and
representative features of the goods or services.
The ECJ held that comparison of products with the same technical functionalities constituted
an objective comparison (C-112/99, Toshiba/Katun, paragraph 39).
The Austrian reporter commented that the public must be provided with all relevant
information to make an objective decision on their advantage. Features or characteristics of a
product or service are considered to be relevant for a comparison if they are appropriate to
have a bearing on a consumer’s decisions. The Belgian reporter observed that the wording of
the Directive does not require that the advertiser shall exhaustively compare all advantages
and disadvantages of the compared products. The French reporter points out that the
comparison cannot be made relating to features of secondary importance.
All relevant differences between the compared products must be disclosed. This is, in
particular, important if the compared products are not similar and the public is not aware of
the differences between the products.
It is also not allowed to base the comparison on incomplete information if this is appropriate
to influence a consumer’s decision to purchase a product or to generally claim the superiority
of the own products without providing any concrete information.
In addition, it is required that the compared goods and services are objectively comparable
with respect to their quantity and quality.
Hungarian advertising law further specifies that it is forbidden to make any advertisement
public, purporting or alluding a true option, that contains a comparison with a fictitious
product or undertaking, with a product that is not available on the market, with a product or
undertaking that cannot be clearly identified, or with a product or undertaking not of similar
nature.
The majority of national reports indicated that comparisons based only on subjective factors
are not allowed. However, pursuant to the Belgian and Dutch case law, it is allowed to make a
comparison based on subjective factors, as long as they have been measured in an objective
manner (i.e., taste of pet food). The Swiss reporter noted that subjective or personal
advertising is admissible since the person of the seller/provider may play a role in the buyers'
decision (e.g., in relation to securities). The same rules as those of objective comparative
advertising are applicable. The doctrine recommends that the requirements apply more strictly
since subjective comparison may be more easily deemed to unnecessarily disparage the
competitor because the facts are often extraneous to competition.
3.3
The criteria for the same need/same purpose of goods
In the great majority of the countries from where national reports were received, there is very
little case law on this point. The UK reporter considered that, according to UK legal literature,
the case-law under trademark law relating to the term “identical or similar goods or services”
is of little relevance to its interpretation.
13
In view of the German reporter, the terms “same need/same purpose” may not be understood
too closely. A functional identity of the offered goods or services is not necessary. Goods and
services in a comparative advertising must be interchangeable and offered on the same
relevant market to the consumers.
Under Austrian law, this requirement means that products or services which are not similar
may be subject of a comparison as long as they can be substituted with regard to the need or
purpose they meet. According to consistent court practice, the compared products or services
must be comparable. It is not required to compare identical products or services. However, the
differences between the compared products or services must not reach an extent of
significance to cause confusion among consumers. For example, a comparative price
advertising which involves two kinds of construction materials and is truthful with respect to
the differences between those materials, would be lawful. However, in another case, the
Austrian Supreme Court found that a tabloid and a newspaper focusing on detailed
information in the fields of politics, economics and culture were not comparable.
The Austrian reporter concludes that a comparison of goods and services which are not
similar is allowed, if the differences between the compared products or services are disclosed
or if the public is aware of the differences.
It follows from the Belgian report that if an advertisement compares goods which are not
competing products because they are not for the same need, and they are therefore not
substitutable, the advertisement cannot be considered as comparative advertisement and its is
subject to general rules of unfair competition (i.e., an advertisement compared the product
Viacreme, a gel stimulating female orgasm with Viagra.)
3.4
Misleading nature of the comparative advertisements
Generally speaking, when an advertisement is truthful, it is unlikely to be found to be
misleading. Pursuant to Article 2(2) of Directive 450/84, an advertisement is misleading if “in
any way, including its representation, it deceives or is likely to deceive the persons to whom it
is addressed or whom it reaches and if, by reason of its deceptive nature, it is likely to affect
their economic behavior or, for those reasons, injures or is likely to injure a competitor.“
The U.S. reporter noted that to succeed in a claim brought pursuant to Lanham Act, the
plaintiff must demonstrate that the advertisement is either literally false or that the
advertisement, though literally true, is likely to mislead and confuse consumers.
It is a general understanding in the national reports that whether an information is misleading
depends on the understanding of the relevant public. As a rule, the relevant public will be
everybody. In specific cases, where the addressees of the advertising are limited circles (like
physicians) their understanding will be decisive. The average consumer or average member of
the relevant public and his first understanding without thorough examination will be decisive.
The standard is an average consumer who is reasonably well-informed. An advertisement
would be forbidden, if certain part of the public would be mislead. Such relevant part of the
public is defined in the Swiss law as a not insignificant part of the public, in the Austrian law
as a still relevant part, that is 10-15% of the public, and in the UK law as a substantial
proportion of the reasonable audience. In addition, the misleading information must be related
to and must favorably influence the decision to buy a product or to hire services.
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The above mentioned general rules apply in the same way when assessing the lawfulness of
comparative advertising. The Spanish reporter commented that a comparative advertising is
more likely to be misleading as it must meet a higher standard of accuracy, and more
requirements are established for this type of advertising.
The British reporter cites interesting cases. In assessing whether a comparative advertisement
is misleading, the courts recognize that the public is used to a certain amount of
hyperbole/”puffing” by advertisers and that statements may be subject to conditions and small
print. The test is whether a reasonable person would believe the claim to be serious or not.
Cases where the court has found comparative advertisements not to be misleading appear to
be where the court thinks consumers would be aware of, or perhaps expect, additional facts
and conditions which are not stated in the advertisement e.g.:
●
in a comparison of the price of flights where the claimant’s flights were to airports in
the city center whereas the defendant’s flights were to airports many kilometers from
the city and certain conditions were attached to the defendant’s flights;
●
in a comparison of the price of mobile phone services where the claimant said that on
average its users saved £20 a month compared with a competitor’s users, without
mentioning that the price may vary depending on the way of usage.
These cases can be contrasted with a case where the court found a comparative advertisement
to be misleading: the advertisement included results of tests on the products being compared,
however, those tests had not been carried out under the normal mode of operation of those
products and this was not apparent from the advertisement.
3.5
Creating confusion with the competitor in the comparative advertising
Pursuant to the Directive, comparative advertising shall be permitted when it does not create
confusion in the market place between the advertiser and a competitor or between the
advertiser’s trade marks, trade names, other distinguishing marks, goods or services and those
of a competitor.
Under Austrian law, a comparative advertising creates confusion in the market if the public is
mistaken as to the belonging of a name, trademark, designation, corporate identity etc. to a
certain undertaking or as to the origin of the goods and services. There is confusion in case
the public could believe that the goods or services come from the same undertaking or from
economically linked undertakings. The Dutch and the German reporters also cite cases where
the reader of comparative advertising may believe that the advertising company is combined
with the competitor. Further, as the Austrian reporter observes, in relation to comparative
advertising, likelihood of confusion may in particular occur when the advertiser tries to
describe the quality of his own products by comparing them to well known other products and
taking advantage of their standing and reputation. Such behavior is considered as "parasitism"
under the French law. The Belgian reporter refers to an advertisement comparing generic and
original pharmaceutical products which was found to create confusion because of comparing
these two different types of medicine.
When assessing the likelihood of confusion in relation to comparative advertising, the
distinctiveness of the name or special designation, the similarity of the name and special
designation as well as the area of operation which is typical for the undertakings has to be
considered.
15
While the Hungarian reporter refers to court practice in trademark infringement cases relating
to the concept of “likelihood of confusion”, the British reporter observes that such analogous
UK case law does not appear to be relevant.
Under Swiss law, the provisions dealing specifically with comparative advertising does not
contain a prohibition of confusion. However, similarly to the Austrian case law, the
exploitation of the good reputation of another product may lead to confusion. For instance,
when the reference to another trademark is combined with words such as “type, “kind”, a risk
of confusion may occur, since the public does not take such words into account.
3.6
Discrediting or denigrating the competitor
Comparative advertising discredits or denigrates the competitor, if the comparison leads to a
decrease of the appreciation of the competitor and his products. However, it is generally not
considered as a denigration of the competitor to objectively show the merits of the own
products by comparing them with the products of a competitor. This is deemed to be part of
the nature of comparative advertising.
The Belgian reporter noted that even certain degree of agressivity of the expressions used in
the advertisement is also accepted.
The U.S. Federal Trade Commission held that disparaging advertising is permissible so long
as it is truthful and not deceptive. The advertisers should not be prevented from making
truthful and nondeceptive statements that a product has certain desirable properties or
qualities which a competing product or products do not possess. Such a comparison may have
the effect of disparaging the competing product, but there is no rule of law which prevents a
seller from honestly informing the public of the advantages of its products as opposed to those
of competing products. The U.S. reporter suggests that it is probably wise for legislatures and
courts to take a long and sceptical look at claims for protection for commercial reputation
since commerce has some inevitable bias to dishonesty.
National reporters provided several examples for the discrediting effect of a comparative
advertising. In particular, this may be established in case of adverse criticism without
justification or in case of the presentation of untrue facts.
The reporters indicated that even the presentation of real facts in the comparative advertising
may amount to denigration. The German reporter observes that the presentation of true facts is
not permitted, if the information is not useful for the consumer’s decision and the consumer is
impaired by inappropriate influence. The Hungarian reporter noted that the reference to real
facts can qualify as unfair if they are presented in a harmful and discrediting manner. Under
Spanish law, even if a declaration is exact and accurate, it does not mean that it is pertinent.
Besides, statements made in comparative advertising must not only be exact, true and
pertinent, but also must be material, relevant, and representative to the goods or services
which are being advertised.
Further, an assertion is denigrating when it shows the competitor’s good as being deficient,
unusable, defective or damaged. The Belgian reporter referred to a case where the statements
in the comparative advertising were denigrating not only relating to the competitor but also to
its consumers. Pursuant to the Swiss reporter, the negative statement must be of sufficient
16
seriousness. If the critical assertion exceeds the acknowledged function of comparative
advertising (i.e. information of the customer), it is then deemed unjustified and
disproportionate.
It can be concluded that the competitors must not unnecessarily be exposed and aggressive
tendencies should be avoided as well as global disparagements. Comparisons, even if they are
materially correct, must also be fair. Consequently, comparative advertising which is
offensive, or includes aggressive tendencies, global disparagements or mockery is not
permitted.
3.7
Price comparison
All national reports indicate that it is permitted to compare exclusively the prices of the
competing products or services. The comparison of prices is subject to the same rules as any
other comparison: one may compare only what is comparable and the comparison must not
mislead the consumer.
Hence, price comparison should refer to identical or equivalent products having identical
qualities, and to identical quantities. Consequently, if the difference in price is due to the fact
that the more expensive product/service meets more needs or has substantially more
advantages, such comparison could be considered unlawful and misleading. In addition, also
the requirement is applicable that the comparison must be made objectively, and such
objectivity may require that more than one characteristic - not only price - shall be compared
when other characteristics of the product/service are essential. In such cases the omitting of
such relevant information may mislead the consumer. The Austrian and Hungarian reporters
refer to cases where the advertiser presented in the comparison much cheaper prices and
claimed the equality of its own product with highly appreciated and well known products of a
competitor (perfumes). Such comparison infringes the requirement of objectivity and amounts
to an exploitation of the well-known brand products, since the advertiser drew the public’s
attention to its own product by using the good reputation of a competitor’s product without
providing details regarding the unequality of the compared products.
Further, the Austrian, Belgian, German and Italian reporters observed that price comparison
will render impermissible, if the consumer may get the impression that competitor’s prices are
generally excessive or it denigrates the competitor. The competitor must not be unnecessarily
exposed in a comparative price advertising.
The Belgian jurisprudence emphasizes that in case of comparing prices of two competitors, it
is not sufficient to state exclusively that the advertiser's prices are lower and those of its
competitor are much higher since the precise and express indication of the prices constitutes
an essential element of objective comparison. However, a Belgian court held an advertising
lawful where a telephone service provider claimed 30% to 35% lower prices than those of its
competitors, even without presenting all the tariff structures of its main competitor.
Under Swiss law, the seller is entitled to indicate, for comparison’s sake, the average
competing price in addition to his own price. The competing price must actually be charged
by the sellers of the relevant segment of the market for at least half of the goods or services of
identical quality and with similar features. The relevant market segment is the geographical
sector where the consumer buys the concerned products.
17
Generally, it is allowed to compare list prices to discounted prices as long as the comparison
refers to the discount and the conditions for benefiting of the discount. It shall be decided on
the basis of the requirement of objectivity whether the advertisement shall indicate all terms
and conditions arising from the discount (i.e., limitation of liability, exclusion of guarantee, if
applicable).
This requirement follows, as the Swiss reporter observes, also from the requirement that
transparency must also concern the type of price that is compared.
3.8
Further criteria for the admissibility of comparative advertisement
3.8.1 Provisions of the national law
Except for the British report, the other national reports did not indicate any further, generally
applicable criteria for the admissibility of comparative advertisement set forth in the national
law.
In the UK national law an action for malicious falsehood arises where (i) the defendant has
published words about the claimant which are false, (ii) they were published maliciously, and
(iii) special damage has resulted as a consequence of the publication. The tests for a
successful claim are stringent, and the courts are reluctant to consider a claim for malicious
falsehood where a claim for trade mark infringement is also being brought in relation to a
comparative advertisement.
While in some countries, in certain fields of business or industry (pharmaceutical industry,
consumer credit), the legislators enacted special rules on the admissibility of comparative
advertising, in other countries (the Netherlands) there are only such product or service
specific requirements that often include an obligation to provide certain information but these
would apply to all advertising.
Strict rules are applicable relating to medicinal products and health professions. In
Switzerland, in advertising for medicine, no comparison and use of superlatives is allowed in
advertising addressed to the public. The legislation is under revision in order to notably add
provisions on price comparison. The legislator aims at reducing health costs, but wants to
prevent price comparison from becoming a means to getting around the prohibition to
advertise for the public. The draft new rules seek to ensure neutrality. The compared drugs
must have a similar action and be interchangeable from a therapeutic point of view. The price
comparison must indicate the pertinent criteria for the therapeutic equivalence. The price per
unit must be the basis of comparison.
It shall be noted that in the UK, it is a criminal offence for anyone to issue an advertisement
which suggests that the effects of a particular medicinal product intended for human use are
better than, or equivalent to those of an identifiable treatment or medicinal product.
3.8.2 Provisions of self-regulatory code of conducts
Special rules applicable to comparative advertising in certain fields of industry/business (i.e.,
pharmaceuticals, professional services), in addition to the general rules on advertising
restrictions, can be found in self-regulatory code of conducts (See Section 7).
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3.9
The concept of the EU Commission’s Proposed Directive on the misleading
nature of an advertisement
On June 18, 2003, the EU Commission presented a Proposal for a Directive concerning
unfair business-to-consumer commercial practices in the Internal Market and amending
directives 84/450/EEC, 97/7/EC and 98/27/EC (the Unfair Commercial Practices Directive)
(COM (2003) 356 final, 2003/0134 (COD) (hereinafter: the "Proposed Directive"). Recital
(5) of this Proposed Directive indicates that it approximates the laws of the Member States on
unfair commercial practices (including unfair advertising) which harm consumers'
economic interests. In line with this, the Proposed Directive sets forth that it neither covers
nor affects the national laws on unfair commercial practices which harm only competitors'
economic interests or which relate to a transaction between traders. Further, it does not
address the provisions of Directive 84/450/EEC on advertising (including comparative
advertising) which is misleading to businesses, but not misleading for consumers.
Pursuant to Article 14 (4) of the Proposed Directive, Article 3a of the Directive shall be
replaced by a partially new list of conditions which each instance of comparative
advertisement shall comply with. The Commission’s rational for the new proposal states that,
for the sake of clarity and simplicity, the Proposed Directive incorporates the misleading
advertising directive’s B2C provisions (i.e., provisions dealing with advertising reaching or
directed at consumers) and limits the scope of the existing Directive to business-to-business
advertising (i.e., provisions dealing with advertising reaching or directed at businesses) and
comparative advertising which may harm a competitor (by denigration, for example) but
where there is no consumer detriment (page 8). Thus, as a result of the amendment,
subsections (a) and (d) will be deleted from the Directive.
The questionnaire raised the issue whether the national reporters agree with the concept of the
Proposed Directive that the misleading nature of the comparative advertisement shall be
assessed in a different way depending on whether it harms the consumers or competitors.
The German, Hungarian and Italian reporters do not agree with the concept, because one can
not separate exactly the aspects of harm to consumer and harm to competitor. Further, the
Spanish reporter comments that it is difficult to think of a situation where a misleading
advertising can only harm a competitor and not the consumers. By definition, a misleading
advertisement is the one that leads to confusion to the end users of the product or service
which is advertised. Therefore, the distinction contemplated by the Proposed Directive is
somewhat artificial and, as a matter of fact, it is difficult to imagine that such new rules will
lead to a different outcome with respect to the present rules of the Directive in force.
Similarly, the Austrian reporter observes that the law on unfair commercial practices should
be fully harmonized with regard to interests of both consumers and competitors. The
differentiation as envisaged in the Proposed Directive is likely to render the national legal
systems unnecessarily complicated and torpedo the legal certainty of the law. The Austrian
court practice has formulated different principles to assess whether misleading comparative
advertising harms consumers or competitors. There is no apparent need for statutory rules as
provided in the Proposed Directive. This is also the view of the French reporter who finds it
undesirable to complicate the system since the difference between advertising addressed to
consumers or professionals has already be taken into consideration in the court practice.
19
Although the Dutch reporter admits that at first sight the concept of the Proposed Directive
would make sense from a consumer protection point of view since this difference has to some
extent been addressed in case law by requiring that the legal appreciation of allegedly
misleading comparative advertising has to take into account the target audience of the
advertising, which may be specialist traders in their professional capacity, he acknowledges
that there is a likely pitfall, namely, that the interpretation of comparative advertising law
relating to consumers and competitors will diverge as a result of the blacklist in the Proposed
Directive. This would not make sense because the average consumer will in the end always be
the yardstick, even if a company complains about unlawful comparative advertising. This
point of view was also taken by the Sociaal Economische Raad ("SER"), the Dutch advisory
committee to the government on economic matters.
On the other hand, the British reporter explains that a significant number of business
participants appeared to agree with the concept that the misleading nature of a comparative
advertisement shall be assessed in a different way for B2C advertisements as opposed to B2B
advertisements. The Proposed Directive introduces the need for a causal link between a B2C
comparative advertisement and the transactional decision by the consumer. However, the
British reporter observes, in practice it seems unlikely that it departs from the way in which
the UK courts apply the current law because they currently tend to find a need that an
advertisement be misleading in any event.
Finally, it shall be noted that for the purposes of the Proposed Directive, in compliance with
the civil law definition in EU legislation, consumer means any natural person who, in
commercial practices (covered by the Proposed Directive), is acting for purposes which are
outside his trade, business or profession. However, in certain countries (Hungary), the concept
of consumer in competition law is not restricted to natural persons.
4.
USE OF COMPETITOR’S TRADEMARKS OR TRADE NAMES
4.1
Conflict between trademark law and the need to refer to the competitor’s
trademark in the comparative advertising
In order to make comparative advertising effective, it is necessary to identify the goods or
services of a competitor, making reference to a trade mark or trade name of which the latter is
the proprietor. However, the holder of a trademark has the exclusive right to use it to identify
the products or services for which the trademark is registered, and to dispose thereof. The
function of the trademark is to individualize and distinguish products or services. The scope
of the exclusive rights conferred by trademark protection covers the right to use the trademark
for advertising purposes.
In 1994, at the Congress of Berlin, LIDC adopted a resolution on the harmonization of the law
relating to unfair competition and declared that, with respect to comparative advertising, a
reference to another's mark or name should be permitted only to the extent that such reference
does not take unfair advantage of, and is not detrimental, to the distinctive character or
reputation of the mark or name.
Recital (15) of the Directive provides that the use of another's trade mark, trade name or other
distinguishing marks does not breach the proprietor's exclusive right in cases where it
complies with the conditions laid down by the Directive, the intended objective being solely
20
to distinguish between the goods/services and, thus, to highlight their differences objectively.
Thus, the Directive permits the use of a competitor's registered mark to this limited extent.
In order to prevent trade mark infringement, such identification should be permitted only if
there is an exemption to the proprietor's exclusive right for use. In certain countries (Belgium,
Hungary, Spain, UK), statutory law (trademark or advertising law) expressly grants an
exemption from infringement and provides that it is permitted to use a third party’s trademark
without the trademark holder´s express consent in comparative advertising, if the comparison
complies with the rules on comparative advertising.
Such requirement means, under the English trademark law, that the use (i) is in accordance
with honest practices in industrial or commercial matters, and (ii) does not without due cause
take unfair advantage of, or is not detrimental to, the distinctive character or repute of the
mark. Hungarian advertising law provides that the trademark holder – on the basis of its
exclusive right – cannot object the use of the trademark in comparative advertising in
compliance with the aim of the advertisement, if the use of the trademark is indispensable for
the comparison and it does not exceeds the extent which is absolutely necessary.
In other countries (Austria, Switzerland), court practice grants a similar exemption from
infringement.
In order to ensure the transparency of the legal system, it would seem desirable if the
trademark law, constituting the exclusive right, would expressly grant a statutory exemption
on the basis of clear-cut rules for the use of the trademark of a competitor in comparative
advertising. This may require the further harmonization of trademark law.
4.2
Limits of the use of third party’s trademark
4.2.1 Taking unfair advantage of third party’s trademark
The Directive and respective provisions in the national laws provide, inter alia, that the
comparison is permitted if:
(i)
it does not create confusion in the market place between the advertiser and a
competitor or between the advertiser’s trade marks, trade names, other distinguishing
marks, goods or services and those of a competitor, and
(ii)
it does not take unfair advantage of the reputation of a trade mark, trade name or other
distinguishing marks of a competitor or of the designation of origin of competing
products.
For example, a competitor does not take unfair advantage of the reputation of a trademark, if
the trademark is solely used to highlight the merits of the advertiser’s product on the basis of
objectively verifiable characteristics. On the other hand, if all the criteria set forth for lawful
comparative advertising are not met, the trademark holder is entitled to object to use of the
trademark which constitutes an infringement.
It follows from certain national reports that the examination as to whether the use of the
trademark takes unfair advantage of its reputation is carried out under different formulation.
21
Under Spanish law, the trademark holder may object to the use of its trademark in
comparative advertising when such use is not a “justified” one. That is, according to the case
law, when the use of the third party’s trademark is not necessary for the development of the
commercial activity (the most clear example is that of the indication of the purpose of a given
product or service, such as retail parts or accessories).
Under English law, as the use of a registered trade mark in a comparative advertisement is
permitted provided that the use (i) is in accordance with honest practices in industrial or
commercial matters, and (ii) does not without due cause take unfair advantage of, or is not
detrimental to, the distinctive character or repute of the mark, the UK courts have focused on
the first part of the proviso i.e. the need for the use to be in accordance with honest practices.
The courts have commented that the requirement that the use does not take unfair advantage
of the reputation of a trade mark adds nothing significant to the need for the use to be in
accordance with honest practices. So, if dishonesty can be proven, it automatically follows
that the use takes unfair advantage of the reputation of the mark.
The Swiss reporter submitted that under Swiss trademark law, specific concerns should be
assessed. Firstly, the advertiser must not give the impression that he is advertising for the
goods of the trademark owner instead of for his own goods. Secondly, the use of a third
party’s trademark in advertising must not mislead the public about the existing relationship
between the advertiser and the owner of the trademark. Furthermore, when the reference to
others’ trademark is combined with words such as “in the style of … “, “type”, the “kind”, a
risk of confusion may appear since the public does not take such words into account. The risk
of confusion is also prohibited under the law against unfair competition.
The cases cited in the national reports are related to the use of well-know trademarks or
trademarks enjoying good reputation. Obviously, the affected trademark must have a
reputation in the market for the products or services provided, which can economically be
exploited. There are no specific statutory rules with regard to comparative advertising using
well-known trademarks, but it may be argued that these trademarks enjoy a wider scope of
protection against taking unfair advantage of the reputation. In these cases, consumers may
more easily associate the products compared by the advertiser with the trademark of the
trademark owner.
Under Austrian case-law, with respect to the use of famous or well-known trademarks in
comparative advertisements, it is not allowed to take unfair advantage of their reputation by
way of assimilation. It was considered to contravene public policy, if the advertiser tries to
show the quality of its own products by comparing them to well known other products in
order to make use of their standing and reputation. One case involved a comparative
advertising campaign of a major Austrian drugstore, where several products of the drugstore’s
newly established house-brand were compared with well-known competing brand products
(for example, “Kodak”). The advertisements only highlighted the – substantially – lower price
of the drugstore’s own products without establishing why the compared products can be seen
as equal. Almost similar factual pattern relating to well-known perfumes was mentioned by
the Hungarian reporter.
Similarly, in Switzerland, the main concern about comparative advertising using trademarks is
parasitism, i.e. the exploitation of others’ reputation. So-called "parasite" advertising takes
advantage without restraint of the good reputation of a competing or non-competing product.
The advertiser refers to the famous trademark or distinctive sign to take advantage of its
22
renown and to favor its own product which it describes as being as good. The two products
are not contrasted with each other, but described as being both as good. Even correct and
objective advertising may be considered unfair when it exploits the renown of a competitor by
attributing to his own product the well-known qualities of the product of the competitor. The
exploitation of the reputation of a competitor is admissible when it enhances the transparency
of the market and is limited in form and content to what is necessary for this purpose
(principle of proportionality). Hence, a company should refrain from referring to its
competitors and use their trademarks, except in case of absolute necessity.
However, the Dutch reporter submitted that the extended protection for well-known
trademarks should not be unduly extended because this would lead to immunity for wellknown trademarks from comparative advertising.
4.2.2 Limitation of use to the word format of the trademark
The questionnaire raised the issue whether it would be desirable to limit the reference to the
competitor by using only the word format of the competitor’s trademark. Conflicting interests
shall be taken into consideration: while it shall be prohibited to take unfair advantage on the
competitor's reputation, the competitor must be clearly identified and confusion shall be
avoided. The use of the figurative trademark may be necessary to exclude any possibility of
confusion. Further, it shall be also noted that in certain cases the use of a word format of a
trademark with a device may constitute a distortion of the trademark which may also damage
the trademark holder’s interest.
The opinions of the national reporters were divergent.
In the view of the Austrian reporter, there is no need to limit the reference to the competitor
by using only the word format if the requirements established by the Directive are met.
Reproducing of a competitor’s logo or device may be necessary to make reference to the
competitor. According to consistent court practice, additional circumstances from which it can
be concluded that the advertiser is taking unfair advantage of the trade mark of the competitor
would render the comparative advertising unlawful. This is also the view expressed by the
French reporter who finds it unnecessary to impose additional limitations since the courts
apply strict requirements to the comparative advertisement. Further, the Dutch reporter
believes that such limitation would be unjustified, since that would be contrary to the case law
of the ECJ, which provides that comparative advertising as a concept should be interpreted in
the sense most favorable to it (see C-112/99 Toshiba/Katun). By limiting comparative
advertising instruments to use of words only, the concept of comparative advertising would be
interpreted narrowly and deprive advertisers of creative possibilities to refer to the competitor
or its products.
In contrast, other national reporters (Germany, Hungary, Spain, Switzerland, UK) found it
reasonable to limit the reference to the competitor by using only the word format of the
competitor’s trademark. However, as the German reporter emphasizes, it shall be made sure,
that even in this case the consumer can identify the competitor and his products.
The Swiss reporter believes that this limitation could be the concrete expression of the
principle of proportionality: the use of others’ trademark should be restricted to what is
necessary for the purpose of giving information to consumers. The use of a logo/device mark
23
would exceed what would be necessary to assist rational consumer choice; use of the word
mark alone may suffice.
4.3
The use of a third party’s other intellectual property rights (i.e., design,
copyright)
While there is an express exemption from trademark infringement in the Directive and in the
national laws (statutory law or jurisprudence), nothing is expressly said about the competitor's
or third party's design right or copyright. The reproduction of third parties' work under
copyright protection, if it does not fall within the scope of free-use (fair dealing), constitutes
per se copyright infringement. The same consideration applies to design as well.
Pursuant to the British report, if a comparative advertisement reproduces e.g. a competitor's
logo or product design, this is likely to amount to copyright infringement unless a statutory
exemption applies (e.g. incidental inclusion4). Consequently, UK copyright law may prohibit
comparative advertising, perhaps supporting an argument that express rules are required
relating to the connection between comparative advertising and copyright (and design). On
the other hand, the UK copyright laws only prevent an advertiser from using, for example, a
logo form of a competitor’s trade mark. There is still scope for lawful comparative advertising
using e.g. a word mark or competitor’s name.
Similarly, under Belgian law, the works under copyright protection cannot be used in a
comparative advertisement.
In view of the lack of any express regulations or comments regarding copyright and other
intellectual property rights in the Directive, it seemed to be unclear as to whether the
advertiser is free to refer to his competitor’s trade marks in his advertisement, but not to any
logo, product shape or package in which copyright or design right may subsist. However, in
Case C-44/01, Pippig, the ECJ – in response to questions referred to by an Austrian court held that Article 3a(1)(e) of Directive, does not prevent comparative advertising, in addition
to citing the competitor's name, from reproducing its logo and a picture of its shop front, if
that advertising complies with the conditions for lawfulness laid down by Community law.
The national reports agree that the same rules shall govern the use of third party’s trademark
and the use of the competitor’s other intellectual property rights: such use shall be permitted if
the advertising fully complies with the requirements set forth in the Directive. However, there
is a difference of opinion on whether it is necessary to create express rules in this respect.
The Dutch and the French reporters submitted that there is no need to establish express rules
since the reference in the Directive (and in the national laws respectively) to "other
distinguishing marks of a competitor" covers what would be protected under other IP rights.
On the other hand, the Hungarian and Spanish reporters found it desirable to establish specific
rules to the use of other intellectual property rights in comparative advertising which would
apply the same principles to which reference has been made above for trademarks and other
distinctive signs. The Belgian reporter observes that the rules of citation shall be extended to
the use of works under copyright protection in the comparative advertising.
4
Section 31(1) of the CDPA.
24
5.
DESIGNATION OF ORIGIN
The Directive provides that for products with a designation of origin, the comparative
advertisement shall relate in each case to products with the same designation and it shall not
take unfair advantage of the reputation of the designation of origin of the competing products.
The requirements of the Directive should, in particular, include consideration of the
provisions resulting from Council Regulation (EEC) No 2081/92 of 14 July 1992 on the
protection of geographical indications and designations of origin for agricultural products and
foodstuffs (see (12) of the recitals of the Directive). The Directive vigorously restricts the
possibility of comparative advertising regarding products with a designation of origin. As the
competing products must have the same designation of origin, the products which are subject
to the comparison are having the same features. The Austrian reporters comment that it
seems, consequently, that only comparative price advertising would be possible.
Under Swiss law, the reference to a designation of origin is also subject to the rules of unfair
competition, notably to the prohibition of misleading and to the prohibition of confusion. It is
prohibited to use a designation of origin to which is added a “delocalizing” information for
products that have more or less the typical characteristics of the products originating from the
designated place but that do not originate from this place (such as Californian Champagne,
Swedish Emmental). This use amounts to the exploitation of a well-known designation. The
adjunction of such words as “kind”, “type”, “way”, to a designation of origin is also unlawful
since this practice may weaken the designation of origin.
Relating to the prohibition of taking unfair advantage of the reputation of the designation of
origin of the competing products, the national reports indicate that the same standards will
apply as in case of trademarks. However, the Dutch report notes that this criteria is taken care
of in the requirement that a comparison must relate to goods with the same designation of
origin. Consequently, it is not possible to take unfair advantage of the designation of origin if
both of the products in the comparative advertising have the same designation.
Contrary to the French and Spanish reporters, other reporters found it unjustified to totally
limit the possibility of comparison to goods with the same designation of origin.
The Swiss reporter suggests that a general limitation would be excessive. However, if a
quality is strongly related to an origin, then the rule that only identical goods should be
compared is applicable and entails such a limitation.
The Austrian, Dutch and English reports submit that it is difficult to justify this restriction
because it quarantines certain products from most types of comparative advertising. For
example, it should be allowed to compare the price of Prosciutto di Parma with Jamon
Serrano Andaluz since in these cases the comparison does not concern features that are not
attributable to the origin, such as price. There are no obvious reasons to treat differently
products with a designation of origin and products with geographical indications when it
comes to comparative advertising. It can be argued that the other requirements of the
Directive (i.e., requirement of objectivity, prohibition on misleading and taking unfair
advantage) sufficiently protect products with designation of origin against taking unfair
advantage of the reputation and misleading use. Further, the Austrian reporter believes that
the restriction concerning products with designation of origin can hardly be justified in view
of the protection of products with a designation of origin by the Regulation (EEC) No
25
2081/92 of 14 July 1992 against imitation and taking unfair advantage of the reputation. Thus,
the restriction in the Directive does not seem to fit in the “overall-regulation” on comparative
advertising.
6.
BURDEN OF PROOF
There are positive requirements (i.e., the objective comparison of material, relevant and
verifiable features of the goods) and negative requirements (i.e., not to be misleading, not
causing confusion, not discrediting the competitor) which comparative advertising should
comply with.
It is the general rule of law that the burden of proving an alleged fact rests on the party who
bases his claim on that fact. Hence, as a rule, the burden of proof lies with the plaintiff.
However, with respect to advertising, there are special rules which constitute an exception to
this rule.
Article 6 (a) of the Directive sets forth that the advertiser shall furnish evidence as to the
accuracy of factual claims in advertising if, taking into account the legitimate interest of the
advertiser and any other party to the proceedings, such a requirement appears appropriate on
the basis of the circumstances of the particular case and, in the case of comparative
advertising to require the advertiser to furnish such evidence in a short period of time5. This
provision means a conditional reversal of the burden of proof which can be compared with
similar provision of the TRIPs relating to the protection of IP rights (Article 43).
In certain countries (Belgium, Hungary, Switzerland6), after having weighed the different
interests of the parties and circumstances of the case, the forum deciding upon the case is
entitled to shift the burden of proof to the advertiser and oblige the advertiser to provide
evidence on the statements made in the advertisement.
In other countries (Austria, Italy, France, the Netherlands, Spain), the burden of proof is
reversed ipso iure and the defendant shall evidence the accuracy and the truthfulness of the
indications and factual allegations he has made in the comparative advertising. Moreover, in
France, the advertiser must prove the compliance with all requirements of legality of the
comparative advertising.
In the UK, different rules will apply depending on which law/cause of action the complaint is
based. The burden will be on the Office of Fair Trading to prove that the advertisement
complained of does not meet one or more of necessary criteria, however, the rules mirroring
the Directive’s provision can also be found in the English legal system. In case of trade mark
infringement, the burden will be on the claimant to show (on the balance of probability) that
the use of the mark concerned amounts to an infringement. If the defendant claims a defense
that the use of the trademark is in compliance with the honest business practice and does not
take unfair advantage of the trademark, the burden is on the claimant to show that the
5
Pursuant to the Proposed Directive, the words “furnish evidence as to the accuracy of factual claims”
shall be replaced by the words “substantiate factual claims”.
6
This special provision of the Swiss law applicable to comparative advertising has been added to the Act
against Unfair Competition in the context of the Swisslex program that aimed at making Swiss law compatible
with European law.
26
defendant’s use of the mark falls outside of that proviso i.e. is not in accordance with honest
practices.
Relating to the nature of the evidence to be supplied by the advertiser, there are no
requirements in the different legal systems. The defendant may furnish expert opinions, test
results, market surveys, etc. depending on the nature of the case and the court is free in
determining the weight it gives to such evidence for determining whether comparative
advertising is allowed or not. In Switzerland and in the Netherlands, in the pharmaceutical
industry, however, special rules apply relating to the required method of proof.7
The Swiss reporter points out that the evidence shall not only relate to the accuracy of factual
claims, but also to the understanding of the advertisement by the public, to the question of the
impact of the advertisement on the decision-making process of the consumer, to whether or
not the denigration or the positive reference to the competitor is necessary.
Although the Directive states that in the case of comparative advertising the advertiser shall
be required to furnish evidence in a short period of time, the national laws do not expressly
refer to a specific timeframe. Under Dutch law, an advertiser is required to provide the
evidence underlying claims in comparative advertising on short notice. The Supreme Court
held that if the advertiser has problems getting his evidence together due to the expedited
nature of the legal proceedings, this is a circumstance for the risk of the advertiser.
The rationale for requiring providing evidence within short period of time is the consideration
that the advertiser should have obtained the respective evidence prior to publishing the
advertisement.
7.
SELF-REGULATORY CODE OF CONDUCTS
7.1
Types of self-regulatory code of conducts and their binding nature
The national reporters indicated that there are both general and industry/business specific selfregulatory rules with regard advertising, and especially to comparative advertising. Specific
professional codes and industry self-regulation rules can be found usually in the
pharmaceutical industry, media, the toys industry, investment banking, pension funds, and
within lawyers. Reference shall be made also to the ICC International Code of Advertising
Practice.
Further differentiation of such codes can be made on the basis whether self-regulation is
exercised by public bodies or by private associations. In the latter case, any code of conduct
adopted by such private associations constitutes a soft-law. As the self-regulatory bodies are
independent of the courts, as the Dutch reporter comments, on occasions they issue
recommendations that are inconsistent with judgments from the courts.
Generally, the self-regulatory rules are only binding for the members of each association. In
some cases membership is compulsory for professionals (i.e., for lawyers, in the
7
In Switzerland, published reports of clinical trials undertaken in compliance with good practice
guidelines shall be provided. In the Netherlands, some self-regulatory bodies have special rules of proof, e.g. the
self-regulatory body that is responsible for medicinal products advertising requires two independent scientific
studies to prove that one product is better than the other for comparative advertising to be permitted.
27
corresponding Bar Association). In Spain, the advertising law grants a specific authorization
to certain collegiate professions for establishing special rules on comparative advertising,
even for introducing prohibition on the use of comparison in advertisement.
The relevance of these self-regulatory rules is that they provide an easily accessible low cost
means of dispute resolution - by means of special committees that judge on the basis of
complaints - from which mainly consumers benefit.
Certain countries (Spain, UK) have a very efficient systems of advertising self-control
whereas self-control appears to play no vital role in other countries (Germany). There is a
divergence also in respect of the role and importance of advertising self-control systems. The
Dutch reporter noted that self-regulatory rules are usually less strictly observed by companies
and often used to dissuade the government from imposing rules in a particular area.
Therefore, self-regulatory rules may be less justified as they tend to serve more the purpose of
protecting companies against the government than consumers and competitors against
companies.
On the other hand, in Spain, the most significant cases of comparative advertising have been
resolved by arbitration, according to the rules provided by the Association for Advertising
Self-Control, integrated by many of the big companies operating in the Spanish adverting
market, who are members of the Association which is a private entity. The membership is
voluntary, and by entering the association, its members commit to solve their advertising
controversies privately, by means of an arbitration procedure. The decisions are binding for
the members of the Association that were parties of the corresponding arbitration procedure.
In the Netherlands, as the national reporter observes, the added value of the general self
regulatory code is that any member of the public - consumers, competitors, etc. – who objects
to an advertisement because it violates the Dutch Advertising Code can lodge a complaint
with the Advertising Code Committee. Though not enforceable, advertisers normally obey the
decision of the Committee. The media that are member of such association are contractually
bound to refuse publication of any advertisements that have been found contrary to the
Advertising Code.
In the UK, extensive self-regulation rules can be found in different segments of the media.
7.2
Professional organizations and EU antitrust regulation
In 2003, LIDC examined whether professional organizations in charge of the drafting or the
control of the rules concerning the practice of liberal professions have to comply with
antitrust regulation.
Some reports indicate that certain professional rules have been held anti-competitive by the
competent competition authorities. With respect to comparative advertising, I briefly refer to
the following European case.8
Article 7(5) of the Directive provides that nothing in this Directive shall prevent Member
States from, in compliance with the provisions of the Treaty, maintaining or introducing bans
or limitations on the use of comparisons in the advertising of professional services, whether
8
Please note that I will not deal with the issue of the connection between primary and secondary EU
legislation since it does not have relevance outside the EU countries.
28
imposed directly or by a body or organization responsible, under the law of the Member
States, for regulating the exercise of a professional activity.
With respect to the requirement of "in compliance with the provisions of the Treaty", in Case
T-144/99, Institute of Professional Representatives before the European Patent Office v
Commission of the European Communities, the Court of First Instance of the European
Communities (CFI) held that the provisions of the code of conduct by prohibiting advertising
comparing professional representatives, constitute restrictions of competition for the purposes
of Article 81 EC, thus, Article 7 (5) of the Directive does not exempt in itself such rules from
the provisions of the Treaty.
Thus, the mere fact that rules which organize the exercise of a profession are classified as
rules of professional conduct by the competent bodies does not mean that they fall as a matter
of principle outside the scope of Article 81(1) EC. Only an examination on a case-by-case
basis permits an assessment of the validity of such rules under Article 81(1), in particular by
taking account of their impact on the freedom of action of the members of the profession and
on its organization and also on the recipients of the services in question.
The subject matter of this case was that the Code of Conduct for Professional Representatives
before the European Patent Office prohibited comparative advertising. The CFI considered
that this ban restricts the ability of more efficient professional representatives to develop their
services, with the consequence, inter alia, that the clientele of each professional representative
is crystallized within a national market. Such prohibition falls within the scope of Article
81(1) EC if it is not shown that the absolute prohibition of comparative advertising is
objectively necessary in order to preserve the dignity and rules of conduct of the profession
concerned since the favorable effects which fair and appropriate comparative advertising has
on competition prevail.
7.3
Special rules applicable to comparative advertising in self-regulatory code of conducts
It is impossible to give a comprehensive overview of these rules as there are many of these
rules. Therefore, the present summary addresses only some special rules.
In Austria, Spain and Hungary, the professional code for attorneys-at-law expressly states
that comparative advertising relating to other attorneys-at-law is not allowed. Under the Swiss
federal law, as a general rule," the lawyer may advertise as long as the advertising limits itself
to objective facts and meets the general interest”. Comparative advertising is de facto
forbidden as it would not comply with the concept of dignity. In the UK, while no publicity
by a solicitor may make direct comparison or criticism in relation to the charges or quality of
service of any other identifiable solicitor, a solicitor may participate in the preparation of a
bona fide survey of legal services conducted by a third party which may make comparisons
between the charges of or quality of service provided by different solicitors.
In Austria, with regard to self-regulatory codes of conduct with regard to pharmaceutical
products, the Supreme Court expressly stated that comparative advertising is allowed, if the
requirements of the Directive are met. Self-regulatory codes of conduct of the pharmaceutical
industry included a prohibition to refer to competing trademarks in their advertisements
without the consent of the competitor. The Supreme Court ruled that this view contravenes the
law of the European Union because it does not comply with the Directive.
29
Pursuant to the Swiss Code of Conduct of the Pharmaceutical Industry, comparison with other
medicinal products must be scientifically accurate and correctly referenced. More detailed
rules can be found in the Spanish code which provides that when the efficacy, security or
other properties of different active agents are compared, pieces of information such as the
statistical significance of the results shall not be omitted, nor results of different studies or
clinical tests shall be compared in the same chart or diagram without clarifications. Statistics
or conclusions or any other data from different studies carried out with different
methodologies cannot be mixed or compared either.
8.
COMPARISON MADE BY THIRD PARTIES
In view of its importance, the survey covered not only comparisons made by competitors, but
also those comparison tests prepared by third parties (who are not competitors).
In many countries, product testing is done by consumer organizations and/or private or public
institutions like the press, television and other media. It shall be examined as to (i) whether
these organizations are liable under unfair competition law, and (ii) whether the results of
their testing may be used in advertising.
8.1
Test comparisons
In all countries covered by the national reports, it is generally permitted to carry out test
comparisons and to publish the results. There are no legal restrictions on third parties carrying
out test comparisons on products. Similarly, there are no restrictions on publishing such test
results, provided that publication would not result in the breach of some other legal obligation
or liability, e.g. breach of copyright, breach of confidentiality, etc. Generally, it is not allowed
to publish product tests which are not true and therefore appropriate to mislead the public.
Stricter rules are applicable in Switzerland where test comparisons are allowed to the same
extent as comparative advertising is admissible. The rules about comparative advertising are
applicable whoever the author of the comparison is and it is not necessary for the assertions to
emanate from a competitor. Some authors consider that the requirements should be stricter for
comparative tests than for comparative advertising since the consumer expects the results to
be the outcome of a neutral and objective examination. Comparative tests are taken very
seriously by the consumer. The Swiss reporter noted that the Swiss case-law on test
comparisons is sometimes difficult to reconcile with the principle of free speech. A Swiss
judgment on the matter was annulled by the European Court of Human Rights because it did
not meet the proportionality requirement.
The organization preparing the test can be held liable under the rules of general tort law. The
Austrian reporter observes that rules of unfair competition apply on misleading statements
only if such misleading statement was made for competition purposes. Organizations (which
are not related to the advertiser or a competitor) preparing tests usually do not act
intentionally with the objective to promote the sales and business of an undertaking. In this
context, the Austrian Supreme Court has ruled that the publication of a test result by a
consumer protection organization was not an act of competition because there were no
competitive interests.
30
8.2
The use of test result in comparative advertising
It is also generally permitted to make reference to test results in comparative advertising.
However, Belgian law prohibits the reference to comparative test if such test was carried out
by consumers' organization.
If the advertiser refers to such comparative test, he shall be held liable for complying with the
rules of comparative advertising.
Under UK law, use of test results is permitted provided that such use is in accordance with
honest practices, thus, the advertisement (i) must reflect the conditions which the product will
encounter in practice and be in accordance with the manufacturer’s instructions; (ii) the
existence of any accepted industry standard test for testing the type of product under
consideration may be relevant; and (iii) where an advertisement claims to be based on
“independent test results” and such results are not achieved by a third party acting
independently, the representation will be viewed as false and therefore dishonest.
For the use of the test in the advertising, in the majority of the countries, it is generally
required to obtain the consent of the person/organization who carried out the test. The national
reports indicated different reasons for the need of such consent: (a) copyright law (Germany,
The Netherlands), (b) database law protection on the test results (The Netherlands), (c) special
statutory provision of advertising law requiring such consent (Hungary).
However, under Austrian law, the advertiser is generally not required to obtain prior consent
by the person or organization who carried out the test. Specific circumstances, e.g. the
advertiser was not ordering the test, may require the consent for the use. In Spain, the consent
of the person/organization carrying out the test is not required as long as such information has
been published or obtained by lawful means. In any case, the source of the information should
be cited.
9.
ENFORCEMENT OF CLAIMS AGAINST
CROSS-BORDER ADVERTISING
UNPERMITTED COMPARATIVE ADVERTISING,
The issue of enforcement of claims arising from unfair competition law was on the agenda of
the Barcelona Congress in 2003 (International Rapporteur: Ms. Frauke Henning-Bodewig).
With respect to such thorough examination of the enforcement procedure, the purpose of the
questions9 raised in the questionnaire was to explore whether there are any special rules in
connection with comparative advertising.
On the basis of such survey it can be concluded that the general rules on enforcement of
claims apply in case of claims arising from unpermitted comparative advertising.
If the comparative advertising is not in compliance with the applicable rules, the same
sanctions shall be applied as in case of any other type of advertisement. It shall be noted that
9
Questions:
Who is entitled to start proceedings in the case of unpermitted comparative advertisement?
What are the sanctions against using unpermitted comparative advertising?
What are the requirements for obtaining an interim measure?
Is it possible to prevent the publication of an unpermitted comparative advertising?
Do you have any statistical data relating to complaints (i) from consumers and (ii) from
competitors on comparative advertising?
31
in all countries, from which national reports were received, actions (usually interim relief) can
be brought to prevent an advertisement from being published, or to remove once it has already
published.
No statistical data were provided relating to the frequency of actions/complaints on
unpermitted comparative advertising.
The same conclusions can be established also with respect to cross-border advertising.
III.
EVALUATION, HARMONIZATION
All countries are essentially content with their respective national rules on comparative
advertising. No national report suggested that any further criteria should be added to those set
forth above.
Significant case-law has emerged relating to comparative advertising. All national reports
acknowledge that their respective courts apply strict scrutiny in evaluating the admissibility
of a comparative advertising and such court practice is considered to be justified. In general,
no divergence between the court practice of different states can be found relating to applying
the criteria for lawful comparative advertising.
The present summary report highlighted certain issues which might require further
discussions and/or fine-tuning of existing rules:
(i)
rules on the use of third party’s intellectual property in the comparative advertisement,
(ii)
comparing goods with designation of origin,
(iii)
role of self-regulatory codes and bodies, and
(iv)
the concept of the Proposed Directive that the misleading nature of the comparative
advertisement shall be assessed in a different way depending on whether it harms the
consumers or competitors.
On the basis of the above summary report and considerations, please find attached a draft
resolution for discussions and which shall be adopted at the Budapest Congress.
____________
32