German Federal Supreme Court confirmed that valid consumer consent to electronic commercial communication requires an “opt-in” but refused to extend that requirement to traditional mail advertising. Bjorn Mann reports.
Topic: Data Protection, Privacy, Electronic Marketing
Who: Operator of a discount card scheme/Consumer watchdog group
Where: The Federal Supreme Court, Karlsruhe, Germany (File: VIII ZR 348/06)
When: July 16, 2008
Law stated as at: 31 August 2008
The operator of a popular multi-company discount card scheme in Germany had included a clause in its terms and conditions whereby participants authorized certain affiliated companies to use personal data provided with the card application and subsequent data relating to card usage for marketing purposes and to send commercial communications to the participants by regular mail, SMS and e-mail. The clause was followed by a checkbox with the note "Please check here if you do not consent".
A consumer watchdog organization had challenged this clause (amongst others), arguing that it put applicants at an unreasonable disadvantage. Two lower courts had already dismissed the action. Upon appeal on a point of law, the Federal Supreme Court in Karlsruhe has found the clause partially void to the extent that it covers the applicants' consent to SMS and e-mail marketing.
The judges differentiate between the consent to regular mail advertisements on the one hand and electronic advertisements on the other hand.
Regular mail advertisements are only subject to the German Data Protection Act, which requires the data subject's informed consent but does not necessarily require that the subject declares consent actively and separately. Therefore, the applicant's signature under a form containing a sufficiently highlighted consent clause is considered to meet the legal requirements.
Electronic advertising messages, however, are additionally subject to the German Act against Unfair Competition, which serves in part as transposition of Directive 2002/58/EC on privacy in the electronic communications sector. This Act, according to the Court's earlier jurisprudence, must be construed in the light of the Directive as requiring opt-in mechanisms.
Therefore, the attacked clause is enforceable only to the extent that it concerns regular mail marketing. Valid consumer consent to electronic commercial communication, on the other hand, would have required an "opt-in" wording of the clause.
Why this matters:
In the light of Directive 2002/58/EC, the decision is hardly surprising, since the directive requires an active consumer opt-in for electronic marketing, and requires the relevant national laws to be construed that way. The judges refused, however, to extend that requirement to traditional mail advertising, so that Germany now has a split regime on consumer consent to commercial communication. In practice, however, this Supreme Court decision is likely to lead to the widespread use of opt-in clauses for the entire field of consent declarations.
The decision itself is unpublished as of yet, so our assessment must be considered preliminary. Stay tuned to martketinglaw.co.uk for any further developments in the matter!