Is "Manufaktur" permissible in a company name?

If a company operates under the name Manufaktur, this is misleading if the company does not meet the requirements of a Manufaktur operation. This was the finding of the Higher Regional Court (OLG) Frankfurt am Main.

A manufacturer of nostalgic tin signs took action against a competitor because the latter used the designation "Manufaktur" in its company name.

The manufacturer was of the opinion that the term Manufaktur had a specific meaning attributed to it by the relevant trade. The competitor, on the other hand, was of the opinion that the term "Manufaktur" had already completely transformed into a synonym for "factory", "firm", "company" or "works".

Misleading use of "Manufaktur"

The OLG Frankfurt a. M. (Beschluss vom 29.06.2021 – 6 U 46/20) followed the manufacturer's view. The Court is of the opinion that the term Manufaktur is understood by the relevant trade as a manufacturing facility with a long tradition and hand-crafted products of high quality. This is evident, on the one hand, from the meaning correctly described in the Duden and, on the other hand, from the word "Manufaktur" itself. Manus = hand and facerere = to build, to do, to produce – according to the Court.

Accordingly, anyone using the term Manufaktur must carry out their production by hand work. The user must furthermore demonstrate the ratio of hand work to the use of machinery in their manufacturing process. In any event, if production is predominantly carried out by machine, hand work no longer exists.

The use of the company component "Manufaktur" is also capable of inducing consumers to make a business decision that they would not otherwise have made. The proportion of hand work in a product can be material to a purchasing decision, as it conveys higher value of the product.

Conclusion

According to OLG Frankfurt a.M., the term "Manufaktur" means two things. On the one hand, the products must be manufactured predominantly by hand work. On the other hand, the company must have a long tradition. Whether the term is actually associated with a long tradition is, however, questionable. This was not, however, a decisive factor in the decision of the OLG Frankfurt a.M. The legal considerations are likely to be transferable to the purely advertising use of the term.