Unfair Competition

Question 1

Competition rules control both restrictive agreements (Article 101 TFEU) and abuse of market power (Article 102 TFEU

Answer 1

Trade mark licences are normally viewed as potentially falling within the prohibition in Article 101.

Question 2

Article 101 TFEU

Answer 2

Prohibits all terms in agreements which appreciably distort competition (or are intended to have that effect), and which may affect trade between member states. Terms of this kind (for example, exclusivity) are commonly found in trade mark licences

Question 3

Agreements of minor importance

Answer 3

Agreements that do not have an appreciable effect on competition, fall outside the prohibition in Article 101(1). Agreements generally do not appreciably restrict competition where:

• The aggregate market share of the parties to the agreement does not exceed 10%
• The market share of each party does not exceed 15% of any market affected by the agreement when the agreement is concluded between non-competitors.

Question 4

International UC regulatory provisions

Answer 4

• Paris Convnetion
• TRIPS
• Soft laws, e.g. WIPO Model Provisions

Question 5

Regional/ European UC regulatory provisions

Answer 5

• Primary Law
• Secondary Law
• Soft law initiatives

Question 6

Article 10bis Paris Convention

Answer 6

The following in particular shall be prohibited:
• 1. all acts of such a nature as to create confusion by any means whatever with the establishment,
the goods, or the industrial or commercial activities, of a competitor;
• 2. false allegations in the course of trade of such a nature as to discredit the establishment, the
goods, or the industrial or commercial activities, of a competitor;
• 3. indications or allegations the use of which in the course of trade is liable to mislead the public as
to the nature, the manufacturing process, the characteristics, the suitability for their purpose, or the
quantity, of the goods.

Question 7

Act of unfair competition

Answer 7

• acts done for the purpose of selling goods or providing services
• address traders… and consumers

Term used to indicate the restrictions on competitive
activities even in the absence of confusion

Question 8

UC acts in comparison to IPR can be defined as consisting of

Answer 8

• torts, not exclusive rights
• non-property
• conduct-oriented assessment rather than object-related protection
• no time limits
• fuzzy grounds of protection

Question 9

EU secondary law (soft law)

Answer 9

• Directive 84/450 on misleading advertising
• Directive 97/55 on comparative advertising
• Directive 05/29 on unfair commercial practices

Question 10

Advertising under directive concerning misleading and comparative advertising

Answer 10

means the making of a representation in any
form in connection with a trade, business, craft or
profession in order to promote the supply of goods or
services, including immovable property, rights and
obligations

Question 11

Misleading advertising definiton

Answer 11

• any advertising
• which in any way, including its presentation,
• deceives or is likely to deceive
• the persons to whom it is addressed
• or whom it reaches and
• which, by reason of its deceptive nature,
• is likely to affect their economic behaviour or
• which, for those reasons, injures or is likely to injure a competitor

Question 12

Necessary components of misleading advertising

Answer 12

• deception
• on target or actual receivers
• affecting behaviour of recipients (as a
result of deception) or competitors’ interest

Question 13

How to check misleading advertising

Answer 13

Normative method (court hypothetical test): Test of presumed expectations of an average adresee who is reasonably well informed and reasonably observant and circumspect
• Empirical method: commissioned an expert opinion or a survey of public opinion and the percentage of consumers misled as sufficiently significant to justify
prohibiting its use

Question 14

Case C-220/98 Estée Lauder regarding misleading advertising

Answer 14

• It is for the national court to decide, having regard
  to the presumed expectations of the average
  consumer, whether the name is misleading.
• Community law does not preclude the national
  court, should it experience particular difficulty in
  deciding whether or not the name at issue is
  misleading, from commissioning, in accordance with
  its national law, a survey of public opinion or an
  expert opinion for the purposes of clarification.

Question 15

Misleading effect of advertising

Answer 15

• Contents objectively untrue
• Contents unclear or too general
• Incomplete content
• Ambiguous content (wildcard)
• Content that raises doubts
• Excessive content (puffery)
• Content objectively true

Question 16

Comparative advertising

Answer 16

means any advertising which explicitly or by implication identifies a competitor or goods or services offered by a competitor;

Question 17

Conditions for comparative advertising

Answer 17

• not misleading advertising
• 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 discredit or denigrate the trade marks, trade names, other distinguishing marks, goods, services, activities or circumstances of a competitor;
• 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 products with designation of origin, it relates in each case to products with the same designation;
• it does not present goods or services as imitations or replicas of goods or services bearing a protected trade mark or trade name
• it does not create confusion among traders, 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

Question 18

Toshiba Europe C-112/99

Answer 18

• No objective comparison where
• the comparative advertising represents the products in question as being of the same quality
without at the same time describing the verifiable features of these products justifying this view,
• even if the comparative advertising states that the advertiser’s products are being sold at a
lower price
• „taking unfair advantage”

Question 19

Belgian Electronic Sorting Technology NV v Bert Peelaers, Visys NV, C-657/11, 11 July 2013

Answer 19

In so far as the use of metatags corresponding to the names of a competitor’s goods and its trade
name in the programming code of a website has, therefore, the consequence that it is suggested to
the internet user who enters one of those names or that trade name as a search term that that site
is related to his search, such use must be considered as a form of representation

Question 20

European Court of Justice, Pippig v Hartlauer, Case C-44/01

Answer 20

• Subjective comparision
• Other distribution channels
• Comparison made by test purchase allowed
• Brand names of rival products allowed
• No stricter national provisions on protection against misleading advertising allowed
• The advertiser is in principle free to state the brand name of rival products in comparative advertising
• Comparison of products from different distribution channels
• Test purchase allowed
• Price comparison is not discrediting of a competitor

Question 21

If the advertising breaches any other specific regulation can be also considered as unlawful in the light of UC regulation?

Answer 21

• Poland – yes: no additional conditions (except entrepreneurs’ interest violation)
• Germany – yes: as long as the other regulation intends to regulate market conduct but no regulations geverning entry to market
• France – yes but under civil code

Question 22

Immoral/ shocking advertising has a broad notion

Answer 22

• Exploitation of fear
• capable of impairing the decision making – Germany UWG
• Gender discriminating
• Minority discriminating
• Human dignity abusive (PL, ES, GE and more)
• Contradiction with good customs
• Polish additional „small” general clause”

Question 23

Audiovisual Media Service Directive 2010/13/EU

Answer 23

• ‘country of origin principle’
• technological neutrality
• Product placement regulation
• No indirect advertising restrictions

Question 24

Conditions of EU Product Placement

Answer 24

• Undue Influence
• Undue Promotional Effect
• Undue Prominence
• Obligation to Inform

Question 25

Two important factors of product placement

Answer 25

Audience and story line

Question 26

Concealed advertising and internet influencers

Answer 26

• Failing to disclose the commercial nature of the instagram (or other) posts
• Influencer needs to create a particular image that brand owners want to exploit for their marketing
• Distinction as to sponsored and non-sponsored advertising

Question 27

Nuisance/ aggresive advertising

Answer 27

• Germany: Market practices which are unreasonably annoying, harrasing or intrusive where it is apparent that the solicited market participant does not want this
advertising.
• Poland: Relation to (gross) violation of privacy – Three cases: soliciting in public places; inertia selling; overuse of technical means
• UK: no direct regulation except direct marketing
• Italy: no direct regulation
• Part of consumer law

Question 28

Opt-in spamming

Answer 28

• prior consent of the user
• difficulties in collecting the content of the user
• „double opt-in”
• permission marketing

Question 29

Opt-out spamming

Answer 29

• contacts possible until objection of the user
• general opt-in: opt-out lists or Robinson lists
• individual opt-in

Question 30

Single opt-in

Answer 30

the user typically adds his or her email address in a signup form or checks a box—as part of a purchasing process, for example—to state interest in receiving marketing emails.

Question 31

Double opt-in

Answer 31

a two-step confirmation process where the subscriber gets a confirmation email that includes a link. Only when the user opens the email and clicks the confirmation link is the email address added to the mailing list

Question 32

UE – unfair commercial practices directive B2C

Answer 32

Aggressive commercial practice: Making persistent and unwanted solicitations by telephone, fax, email or other remote media except in circumstances and to the extent justified under national law to enforce a contractual obligation

Question 33

Children as targetted consumers

Answer 33

Specific regulations
• Italy – exploitation of the gullibility
• Poland – general ban of the exploitation of gullibility plus detailed media regulation
• France – self-regulation