Advertising with 'Previous' Price – Unfair Competition Violation?

Advertising reduced prices with reference to the previously applicable price as a 'previous price' is a popular means of prompting customers to make a purchase. Customers are thus presented with a 'bargain'. However, such advertising may also entail the risk of unfair competition. The Regional Court (LG) Bochum had to decide when an unfair competition violation exists.

An online retailer advertised a bicycle helmet with a reference to the previously charged price. The time at which the higher price was last charged lay months in the past.

A competing competitor saw an unfair competition violation in the advertising. He sought a court injunction against the advertising retailer.

The Court's Decision

The LG Bochum ruled in favour of the claimant. By Judgment of 24.03.2016 – Az. I 14 O 3/16 the online retailer was prohibited from advertising its products in this manner.

The court's decision was justified by the considerable time span that lay between the advertising and the offer. The public associates a 'previous' price with a price that was recently demanded for this article. A time span – as in the present case – of more than three months was in any event too long. The court affirmed that there was misleading conduct towards the public, as the public would assume, on the basis of this presentation, that a price reduction had taken place recently.

Conclusion

Advertising with reduced prices is in principle permissible. Previous prices may also be presented alongside current prices – but only within a limited time period. The price reduction should therefore be reasonably current in order to avoid unfair competition through misleading conduct.