Thursday, 17 October 2013

Sponsored publications NOT to be seen as commercial practices - CJEU in RLvS (C-391/12)

17 October 2013: CJEU judgment in case RLvS (C-391/12)

Today the CJEU decided not to follow the AG's opinion in the RLvS case which examines the character of sponsored publications in a newspaper with regards to their potential misleading effect on consumers (for facts of this case see our earlier post: Sponsored publications as unfair commercial practices...)

The CJEU agrees with the AG Wathelet that German law may not prohibit or more severely restrict commercial practices than what the Unfair Commercial Practices Directive requires, even if such restrictions could be justified as an attempt to protect pluralism of the press. (Par. 33) At the same time, however, the judges do not share the AG's conviction that a publication of editorial content by a newspaper publisher could be perceived as a commercial practice. This would mean that it would not fall under the scope of the Directive and could be separately regulated by national laws. (Par. 34-35) 

It is the Court's opinion that a commercial practice must originate from a trader and be directly connected with the promotion, sale or supply of his products, and the 'trader' is defined broadly, which means that the Directive applies also when a trader's practice is put to use by another undertaking and benefits that undertaking. (Par. 37-38) The editorial content that was the subject of the judicial proceedings was not promoting the publisher's product (free newspaper) but rather it promoted products and services of other undertakings, and as such could fall under the definition of a commercial practice due to the broad definition of a 'trader' in the Directive, satisfying the first requirement. (Par. 39-40) However, the Court believes that any promotion through the editorial content of a newspaper was 'indirect' and was not liable to significantly influence the consumers' economic behaviour with regards to acquiring the newspaper. Therefore, this practice could not fall under the scope of the Directive as a commercial one. (Par. 41)

Interestingly, both the AG and the CJEU support their argumentation by referring to the same provision in the Directive - point 11 on the black list that determines as unfair such use of advertorials that does not clearly inform consumers that the editorial content was paid for by a trader. According to the AG that provision signifies that national laws may not demand more strict requirements to be met with respect to editorial content's publication. The Court stated, in turn, that this provision:

"(...) is not intended as such to require newspaper publishers to prevent possible unfair commercial practices by advertisers for which a direct connection could thereby be potentially established with the promotion, sale or supply to consumers of the products or services of those advertisers." (Par. 44)

I have to admit, though, that it's hard to see for me what this provision was intended for if not for that? The Court seems to point out that this prohibition would apply only to advertisers and that they should be the ones who make sure that the editorial content is clearly labelled as sponsored. This seems to get the newspaper publishers off the hook rather easily.

More convincing are arguments referring to a potential conflict of this provision with requirements set out by Directive 2010/13 and Directive 89/552. (Par. 45-46) Lastly, the CJEU underlines that the European Commission has not yet directly legislated the area of publishers' obligations with regard to third-party sponsored content of their publications, as far as written press is concerned, which means that Member States are free to regulate it. (Par. 49)

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