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You Are Not Allowed to Speak Badly About Your Competitors

Businesses may want to know certain things about their competitors, such as their USP, price, quality, convenience, location, product range and customer service.

In a previous article you could already read that it is forbidden to advertise in a way that misleads or may mislead the consumer, unless it concerns exaggerated advertising that should not be taken literally. In this article, we look at another spectrum of prohibited advertising, namely denigrating comparative advertising and badgering.

The Court of Appeal of Antwerp recently had to decide whether an e-mail to the press from a company in which it links its competitor to ‘sjoemelsoftware’ (software used to influence test results) should be considered as advertising in accordance with Article I.8,13° of the Economic Code (hereafter: WER). Moreover, the Court also had to examine whether the company was thereby guilty of badgering (Article VI.104 WER) and denigrating comparative advertising (VI. 17, 5° WER).

Article I.8.13° WER

Article I.8.13° WER defines “advertising” as: “Any communication aimed directly or indirectly at promoting the sale of products, regardless of the place or means of communication used”. In other words, the concept of advertising is broadly defined.

The Court of Appeal ruled that the e-mail falls under the definition of advertising, as it has at least the indirect objective of promoting the sale of products. After all, by besmirching the reputation of a competitor, one’s own image is strengthened, which can promote the sale of products. This view is fully in line with the case law of the Court of Cassation in a case where the Court ruled that: “the placing of an identification plate on one tank which – from the nature of the case – can only be installed in one place can constitute advertising.”

Article VI. 104 WER

Article VI.104 WER prohibits any act contrary to fair market practices by which a company harms or is likely to harm the professional interests of one or more other companies.

According to the Court of Appeal, badgering consists of: “making an announcement containing a fact or an allegation, launching an attack or expressing a criticism which, in the mind of third parties, is likely to undermine the credibility or the reputation of an economic operator, of its products, its services or its activity.”

Dyson argued before the first judge that BSH had allegedly manipulated test results. The Court of Appeal confirmed the decision of the first court insofar Dyson wrongly linked BSH’s products to fraud scandals as she was not convicted for these allegations. The Court of Appeal accused Dyson of badgering. After all, it is not for Dyson to insinuate that BSH has infringed a statutory provision. With this decision, the Court of Appeal follows the established case law that such accusations, in the absence of a final conviction, must be qualified as badgering.

Article VI.17 WER

Article VI.17 of the WER stipulates that comparative advertising is permitted on condition that it:

  • “1° is not misleading;
  • 2° compares goods or services that meet the same needs or are intended for the same purpose;
  • 3° objectively compares one or more essential, relevant, verifiable and representative features of those goods and services, which may include price;
  • 4° does not cause the goods or services of the advertiser to be confused with those of a competitor;
  • 5° it does not damage the good name of or denigrate the brands, trade names, other distinguishing marks, goods, services, activities or circumstances of a competitor;
  • 6° for goods with an appellation of origin, relates in any case to goods with the same appellation;
  • 6 Zie arrest Hof van Beroep te Antwerpen 20 januari 2021, NjW 2021, afl. 450, 778.
  • 7 Zie arrest Hof van Beroep te Antwerpen 20 januari 2021, NjW 2021, afl. 450, 778.
  • 8 Voorz. Kh. Antwerpen 1 februari 2011, Jb. Markt. 2011, 527; Voorz. Kh. Antwerpen 4 oktober 2011, Jb.Markt. 2011, 559.
  • 7° 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 goods;
  • 8° does not present goods or services as imitations or replicas of goods or services with a protected trade mark or protected trade name.”

Any comparative advertising that does not comply with the abovementioned conditions is prohibited. Since Dyson identifies BSH’s products in the e-mail to the press, it can be considered as comparative advertising in accordance with Article I.8,14° WER.

As set out above, the Court of Appeal ruled that Dyson is guilty of badgering pursuant to Article VI.104 WER, thereby damaging the good name of its competitor (BSH) and committing an infringement of Article VI.17,5° WER.

Some examples of derogatory comparative advertising messages and/or badgering:

  • According to a Utrecht judge, the slogan “Now really without antics” of supermarket Steengoed as a variant of the slogan “No antics. That saves” of C1000 was unnecessarily disparaging.9
  • When Ryanair was introduced in Belgium in 2001, the low-cost airline immediately nauseated Sabena with the slogan: “Pissed off with
  • Sabena’s high fares?” above a picture of Manneken Pis, who made Sabena disappear for good with a jet.
  • Not much later, Sabena successor ‘SNBA’ was welcomed by Ryanair with a smiling Mona Lisa saying: “SN says it has the lowest fares in Europe? Don’t make me laugh”.

Conclusion

The concept of advertising has a broad meaning in Belgian law. Any communication that can directly or indirectly promote the sale of products will be considered as advertising. If you mention the products of a competitor, you will fall under ‘comparative advertising’ and, as a company, you must comply with the conditions of Article VI.17 WER.

For example, it is prohibited to damage the good name of a competitor and to belittle the goods and services of a competitor. You should therefore always ensure that when you engage in comparative advertising, you comply with the conditions of Article VI.17 of the WER.

If you still have questions after reading this article, please do not hesitate to contact Joost Peeters.