On May 21, 2008, the Federal Cabinet approved a draft amendment to the Act Against Unfair Competition (UWG). The Act provides consumers with greater legal certainty, including the introduction of a “Blacklist” of unfair commercial practices. This amendment implements EU Directive 2005/29/EC and further enhances the high level of consumer protection in competition law, which was already established in Germany with the last UWG reform in 2004.
“With this reform, Germany is making a significant contribution to strengthening the European single market. Consumers will now be protected against unfair commercial practices and fraudulent businesses when shopping abroad, just as they are domestically. This enables them to better utilize the advantages of the European single market, such as a wider product range and lower prices, whether shopping in a foreign store or purchasing via a foreign website. This also pays off for businesses. They can reach 450 million consumers across the EU using the same methods they employ to address customers in their home country,” said Federal Minister of Justice Brigitte Zypries.
Details of the regulations:
- The UWG will be supplemented by an annex containing 30 misleading and aggressive commercial practices that are prohibited under all circumstances (the so-called “Blacklist”). These “absolute” prohibitions will facilitate consumers in enforcing their rights. Furthermore, the list leads to greater transparency, as consumers can directly infer from the legal text which conduct is prohibited towards them in all cases.
Examples of impermissible practices:
- The false claim by a business that it is a signatory to a code of conduct (No. 1 of the Annex to § 3 para. 3 UWG-E),
- The false statement or the creation of a misleading impression that legally existing rights, such as rights of withdrawal or cancellation, constitute a special feature of the offer (No. 10 of the Annex to § 3 para. 3 UWG-E),
- The false statement that the business will soon cease operations or relocate its premises (No. 15 of the Annex to § 3 para. 3 UWG-E),
- The transmission of promotional material accompanied by a request for payment, if this creates the false impression that the advertised goods or services have already been ordered (No. 22 of the Annex to § 3 para. 3 UWG-E).
- In the future, the UWG will explicitly apply to the conduct of businesses both during and after contract conclusion. Previously, the UWG regulations only applied to commercial practices prior to contract conclusion.
Example: A consumer repeatedly asserts a claim in writing against an insurance company arising from an insurance contract. The insurance company systematically fails to respond to these letters, thereby discouraging the consumer from exercising their contractual rights. Such conduct is impermissible according to No. 27 of the Annex to § 3 para. 3 UWG-E.
- It is explicitly stipulated that businesses must not withhold information from consumers that is necessary for their economic decisions. A corresponding catalog of information requirements creates transparency and legal certainty. This catalog is not exhaustive; jurisprudence can further develop it.
Example: A garden center sells non-native plants and shrubs for gardens without indicating that these should not be planted in gardens. According to § 5a para. 3 No. 1 UWG-E, such conduct is unfair.
Source: Press release of the Federal Ministry of Justice of 21 May 2008, Published by the Press and Public Relations Department of the Federal Ministry of Justice, Responsible: Eva Schmierer; Editors: Dr. Henning Plöger, Dr. Isabel Jahn, Johannes Ferguson, Ulrich Staudigl, Mohrenstr. 37, 10117 Berlin, Telephone 01888 580-9030, Fax 01888 580-9046, E-Mail: presse@bmj.bund.de
Due to the new legal regulations, all entrepreneurs and traders must adapt to the new legal regulations. It is therefore imperative to review the general terms and conditions and future advertising measures and to amend them at short notice if necessary.
Goldberg Attorneys at Law, Wuppertal-Solingen 2008
Attorney at Law Michael Ullrich, LL.M.(Information Law)
m.ullrich@goldberg.de
