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Caution: unlawful advertising measures can prove costly in Germany

Caution: unlawful advertising measures can prove costly in Germany

Advertising is part and parcel of our daily lives. Not just because we are exposed to it all over the place on a daily basis, but also because traders spend a lot of time reflecting on how best to market their own business.
There are, however, legal boundaries in place that are designed to protect not just consumers, but also other traders against unsolicited advertising.

Legal provisions

Whilst the German Civil Code allows the owner of an established and active commercial enterprise to file for injunctive relief against unsolicited e-mail advertising, relief against unsolicited advertising under Germany’s Act Against Unfair Competition (abbreviation: UWG) is more extensive.

Under this act, every market participant, i.e. not just competitors and consumers but all persons who are active as providers or demanders of goods or services can file for injunctive relief against advertising that causes them unreasonable harassment.

Unreasonable harassment is always to be assumed if advertising is sent via a means of commercial communication that is suited to distance selling, despite the consumer or the other market participant not wishing to receive it.

In particular, the legislator considers marketing calls, marketing faxes and marketing e-mails made or sent to a consumer or other market participant without their consent, or presumed consent, to constitute unreasonable harassment.

Consequences for the trader

Yet how can a trader wishing to advertise its product by personally targeting customers, using means of distance communication, be sure that the recipient of the advertising has given consent or presumed consent?

In principle, the advertiser can only be certain of consent to the receipt of advertising if it has that consent in writing. As a matter of principle, consent can only be deemed to have been given if a business relationship already exists or previously existed between the advertiser and the recipient of the advertising.

As regards the requirements for such consent, a distinction must be made between telemarketing and electronic advertising.
Whilst telemarketing is subject to explicit consent to this form of advertising, for electronic advertising the requirement is simply that the customer of the advertiser has not objected to the advertising.

The practical implications of this are as follows.
For telemarketing, consent is always deemed to have been given if, in the context of a previous or existing business relationship with the advertiser’s business, the recipient has expressly consented to being contacted for marketing purposes. In order to be able to prove this in the event of a dispute, this consent should always be given in writing.
Traders who are planning to also contact their customers by phone with new offers should therefore have obtained the customer’s consent or otherwise to telemarketing, by asking him to select the relevant option either in an agreement previously concluded or in another form of written contact.

Since, for e-mail marketing, it is sufficient for the customer not to have objected to this form of advertising, there is no need to seek the customer’s consent to advertising by selecting the relevant option.
The customer must simply be made aware in, for instance, a preceding agreement – and in every marketing e-mail subsequently sent – that he may object to the use of his e-mail address at any time. Moreover, advertising by e-mail may only be sent for products similar to those on account of which a business relationship already exists or has existed. Furthermore, the advertiser must have received the contact details from the customer himself.

If these conditions are not met, the advertiser might be able to invoke the presumed consent of the recipient of the advertising.
Presumed consent only exists if, ‘based on specific circumstances’, the caller can presume that ‘the person to be called has an objective interest’ in the call (Federal Court of Justice (BGH) GRUR 2010, 939 marginal number 20). This means there must be a specific reason that justifies the call, based on the recipient’s particular sphere of interest. The trader must therefore assume that the recipient of the call takes a positive attitude towards the call. In practice, this can only be proved by documented telephone calls. In order not to violate data privacy regulations, it is important to ensure the customer is made aware that the call is being recorded. The same applies to e-mails:

The aim of this narrow interpretation of consent or presumed consent is to protect privacy.

As the German legislator has placed so much importance on protecting the person receiving the call, it goes without saying – and we are only mentioning it here for the sake of completeness – that the makers of marketing calls who conceal their identity or advertisers who are unable to provide an address to which a request to cease marketing calls could be sent are breaking the law within the meaning of the UWG.

If a trader wishing to promote its business by phone or electronically is unsure whether the advertising is lawful, it is essential to seek legal advice.

Consequences of violation

Any advertiser who violates the UWG and sends unlawful advertising will soon receive a letter from a lawyer, asking it to sign a cease and desist declaration, which can be enforced by a penalty. As well as signing to agree that it will pay a (usually four-figure) sum for each further piece of advertising that it causes to be sent to the lawyer’s client, the advertiser must also pay the legal costs. Advertising can thus rapidly become unprofitable and very expensive.

Nonetheless, as Henry Ford himself understood, the cost of advertising is not as high as the cost of not advertising. Therefore, traders should not let Germany’s laws deter them from advertising; rather, they should take full advantage of the legal scope.

 

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