21. Oct 16

BGH: Redeeming competitors’ discount vouchers not a violation of competition law

The Bundesgerichtshof (BGH), Germany’s Federal Court of Justice, has ruled that if a company redeems competitor’s discount vouchers this is generally not considered to be unfair and does not constitute a violation of competition law (Az.: I ZR 137/15).

GRP Rainer Lawyers and Tax Advisors in Cologne, Berlin, Bonn, Düsseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London conclude: Discounts vouchers are a popular form of advertising for drawing customer into one’s store. At the same time, they can also lead to high customer loyalty. If rival firms decide to get in on the act and offer to redeem consumer’s discount vouchers from competitors, the 1st Civil Panel of the Bundesgerichtshof, competent to hear cases relating to unfair competitive practices among other things, clarified in its ruling of June 23, 2016 that this does not constitute an infringement of competition law.

A drugstore chain had offered to redeem consumer’s discount coupons from a competing firm in its own stores. The Zentrale zur Bekämpfung unlauteren Wettbewerbs (Centre for Protection against Unfair Competition) filed a lawsuit in response to this policy, arguing that this type of advertising represented a deliberate attempt to hamper the competitor and was also misleading to consumers, as it gave the impression that a corresponding agreement existed between the rival firms.

As was the case before the courts of lower instance, the injunction suit failed before the BGH as well. The judges of the Karlsruhe court held that the policy in question was not an unfair intrusion in a third party’s clientele, stating that the recipients of the discount vouchers had not yet become buyers at the company carrying out the promotional activity by virtue of this alone. The Court went on to say that this could not even be said to be the case if the vouchers were specifically sent to those in possession of a loyalty card or participants in a customer loyalty program, because consumers decide at a later date whether or not they will redeem the vouchers in the first place. The Court also ruled that if the defendant company advertised using self-standing displays in its stores then this form of advertising was directed at its own customers, who were not prevented by this promotion from redeeming their vouchers with the competitor; instead, they were being provided with an additional opportunity to redeem the discount vouchers. The BGH concluded that this did not represent an unfair attempt to hamper the rival firm based on advertising.

The Court further opined that consumers had not been misled, stating that consumers would not have identified this as being a concerted promotional measure by several companies.

Anticompetitive infringements can give rise to formal written warnings, interim orders, injunction suits and damages claims. Companies can turn to lawyers who are versed in the field of competition law to assist in fending off or enforcing these kinds of legal actions.

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