Who: Verband Sozialer Wettbewerb (“VSW”); DHL Paket (“DHL”); European Court of Justice (“ECJ”)
Where: EU
When: 30 March 2017
Law stated as at: 10 May 2017
What happened:
The CJEU has ruled that certain limited-space ads may be exempt from the requirements in the EU Unfair Commercial Practices Directive (“UCPD”) to disclose certain information, including the identity and address of the trader, as long as consumers are referred to a website which communicates such information “simply and quickly”.
The claim
DHL operates an online platform in Germany through which businesses can sell their products. When a consumer makes a purchase through the platform, a contract is formed between the business selling the products and the consumer; DHL is not part of this contractual relationship.
DHL ran a print ad in a newspaper which advertised its platform by reference to five different products available on the platform. However, the ad itself did not disclose the name and address of each individual seller, but instead invited consumers to visit the online platform, where the details of the business selling each product were set out on the applicable product webpage.
VSW, an association representing sellers who used the DHL platform, brought proceedings on the grounds that a failure by DHL to disclose the seller identities and addresses was a breach of the UCPD.
The law
Where a practice is an “invitation to purchase”, the UCPD requires specific information, including the identity and geographical address of the trader, to be communicated to the consumer. The case of Konsumentombudsmannen v Ving Sverige AB suggested that the definition of an invitation to purchase will capture any ad which includes reference to a product and its price.
The UCPD also states, however, that in making an assessment as to compliance with the UCPD information disclosure requirements, courts should take in to account the factual context, any limitation of space or time imposed by the medium of communication used and any other means used by the trader to make the information available.
The CJEU’s decision
The CJEU’s decision was favourable for DHL. The CJEU decided that the ad was an “invitation to purchase” and that it was therefore subject to the information disclosure rules of the UCPD. It also commented that it does not matter whether a third party places the ad; the material information is still required in respect of each trader whose products are promoted.
However, the CJEU acknowledged that press ads may be subject to space limitation, and therefore that it could be sufficient to provide the trader name and address information required under the UCPD on a linked website, as long as the relevant prescribed information can be easily found. It will be for national courts to examine whether the space is sufficiently limited for this exception to kick in, and whether the information is displayed clearly enough on the trader’s website.
Why this matters:
The ECJ has taken a pragmatic view in this case, which is good news for traders using limited space media. Where space is truly limited, the information disclosure requirements for invitations to purchase may be relaxed. However, advertisers are strongly advised to include as much of the information prescribed by the UCPD in their ads as possible and to ensure that, where any information cannot be communicated on the ad itself, the information can be located by consumers on the trader’s website “simply and quickly”.
