Monday, 29 July 2013

Sponsored publications as unfair commercial practices - AG Wathelet in C-391/12 (RLvS)

11 July 2013: opinion Advocate General Wathelet in case C-391/12 (RLvS)

RLvS publishes daily various advertisements in a journal called GOOD NEWS. In June 2009 it published two sponsored articles. Both these articles made a distinction between the 'news' part and the 'advertisement' part thereof. In the 'news' part it was mentioned that the articles were sponsored and the 'advertisement' part was marked with the word 'advertisement'. However, German press law has more strict requirements that need to be fulfilled in case the publication is sponsored (Art. 10 LPresseG). Namely, any sponsored publication is prohibited regardless its aim, as long as it is not clearly marked as an 'advertisement', unless the position and the form of the publication leave no doubt as to its advertising purpose. The purpose of this provision is to protect consumers from misleading commercial practices and to protect independent press. The competitor of RLvS, a German newspublisher - Stuttgarter Wochenblatt - claimed that RLvS infringed provisions of German press law. The Bundesgerichtshof had, however, doubts as to whether the Art. 10 of the German press law is compatible with the Unfair Commercial Practices Directive - by establishing such a general prohibition of sponsored publications - and asked the CJEU for its opinion on this matter.

AG Wathelet advises the CJEU to recognize the incompatibility of Art. 10 LPresseG with the Unfair Commercial Practices Directive. As long as a sponsored publication could be considered to constitute an unfair commercial practice in the meaning of Art. 5 Directive, there cannot be a legal requirement for the publishers to mark clearly such a publication as an 'advertisement', unless the presentation or concept of that publication clearly denotes such an advertising purpose of this publication already.

Par. 11 of the Annex I to the Unfair Commercial Practices Directive clearly blacklists a following commercial practice: "Using editorial content in the media to promote a product where a trader has paid for the promotion without making that clear in the content or by images or sounds clearly identifiable by the consumer (advertorial)." The German press law goes further than these requirements by obliging the publishers to add a word 'advertisement' to the publication. (Par. 39-40) Due to the maximum harmonisation character of the Directive, national legislators were not allowed to make more restrictive provisions than the ones adopted by the EU. (Par. 38) By modifying the provisions of Par. 11 of the Annex I the German legislator changed blacklisted commercial practices in Germany, which it was not allowed to do. (Par. 43)

It needs to be mentioned that while Art. 10 LPresseG regulates any publication, irrespective of its commercial purpose, the Directive regulates only such activities that have a commercial purpose. (Par. 27, Par. 35) For this reason the Directive may not be applicable to many cases regulated by Art. 10 LPresseG where the purpose of the publication won't be to convince consumers to conclude a particular commercial transaction, but, e.g., it would be a publication sponsored by a political party. (Par. 37) The evaluation whether a given publication has a commercial purpose should be conducted on a case-by-case basis by a national court.

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