Unfair advertising – No price comparison without price quotations
Price comparisons featuring tariffs both with and without price quotations are considered to be a form of unlawful comparative advertising and in breach of competition law. That was the verdict of the Oberlandesgericht (OLG) Köln, the Higher Regional Court of Cologne.
Whether it be travel, insurance, or other services, there is a tendency for consumers to compare offers online in the age of the internet. Comparison sites offering this service are easy to come by. That said, comparative advertising is considered to be unlawful if, as part of a price comparison, products featuring price quotations are contrasted with products without any indication of price. We at the commercial law firm GRP Rainer Rechtsanwälte can report that this was the verdict of the Oberlandesgericht Köln in a ruling from April 12, 2019, case file number 6 U 191/18.
The case before the OLG Köln concerned a legal dispute between an online comparison site and an insurer. The comparison site had listed and compared the products of various providers. Because the insurer rejected collaborating with the site, its products were ultimately listed without any indication of prices. The insurer demanded that it be completely removed from the list, arguing that this was an unlawful comparative advertisement due to it missing material information in the form of prices.
While the claim was unsuccessful at first instance, the OLG Köln ruled in favor of the insurer. The Court held that the advertisement was in breach of the Gesetz gegen den unlauteren Wettbewerb (UWG), i.e. Germany“s unfair competition act, and therefore unlawful. It went on to state that comparative advertising without price quotations is not unlawful as a matter of principle, and the comparison might still have been acceptable if it had not been limited in scope to price but instead also included various other product or service features. This was based on the assumption that comparative advertising need not be comprehensive, as the average consumer is said to be aware that this kind of advertising is meant to emphasize the benefits of a given advertiser.
In the instant case, however, the Court found that from the point of view of consumers, the products were being compared purely on the basis of price, since the site promoted itself as comparing the price of services. The site“s presentation, among other things, placed special emphasis on the price, with the result that it was to be seen as the key criterion according to the Court.
Violations of competition law may be met with severe penalties. Lawyers experienced in competition law can offer advice.
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