Competitor: yes, but when?

A prerequisite for a competitor's entitlement to seek a cessation of competition law infringements based on the risk of repetition is a concrete competitive relationship between the parties. But at what point in time must this concrete competitive relationship exist? The Higher Regional Court (OLG) Frankfurt a.M. has taken a position on this matter.

A competitor had initially issued a cease-and-desist letter to the operator of an online shop in respect of several competition law breaches and subsequently sued for an injunction. The recipient of the cease-and-desist letter had operated an online shop, but had already ceased selling goods by the time of the cease-and-desist letter. Rather, a notice on the website of the recipient of the cease-and-desist letter indicated that it would no longer be able to make deliveries from October 2011 onwards, but was working on new products.

The issuer of the cease-and-desist letter had only expanded its product range in October 2012 and added to its range a particular product that had also been distributed by the recipient of the cease-and-desist letter until the end of September 2011.

Decision of the Court

By way of judgment dated 03.07.2014, the OLG Frankfurt a.M. – Az.: 6 U 240/13 decided that for the active legitimation to assert a competitor's entitlement to seek cessation of a competition law breach based on the risk of repetition, it is sufficient that the parties are in a concrete competitive relationship at the time of the final oral hearing; it is not required that the competitive relationship also existed at the time of the infringement constituting the risk of repetition.

The assumption of the concrete competitive relationship required for active legitimation is not precluded by the fact that the issuer of the cease-and-desist letter was not yet a competitor of the recipient of the cease-and-desist letter at the time of the infringement constituting the risk of repetition (until 30.9.2011), but only commenced trading in the particular product in October 2012.

Since the entitlement to seek an injunction is directed solely at preventing certain conduct in the future, it is – according to the court – necessary for active legitimation, but also sufficient, that the creditor of the obligation to cease the infringing conduct is in a concrete competitive relationship with the debtor of that obligation at the time of the future threatened infringement. This is the case here if – which must be assumed in light of the continuing risk of repetition – the recipient of the cease-and-desist letter were to make the offers prohibited by the contested judgment again in the future.

The OLG Frankfurt a.M. was also unable to identify any convincing reasons for making active legitimation dependent on a competitive relationship existing already at the time of the underlying infringement. For as long as the risk of repetition arising from the committed infringement persists, a newly joined competitor also has a worthy interest in preventing further substantially identical infringements. It would also – according to the OLG – be inconsistent to require, for the assertion of an entitlement to seek cessation of a competition law breach based on the risk of repetition, the existence of a competitive relationship already at the time of the underlying infringement, whilst this requirement could by its nature not apply to the assertion of a preventive entitlement to seek cessation based on the risk of first infringement.

Conclusion

In view of the fact that the question of whether active legitimation for a competition law entitlement to seek cessation of an infringement presupposes the existence of a competitive relationship already at the time of the infringement is of fundamental importance, the OLG Frankfurt a.M. has permitted an appeal to the BGH. It therefore remains to be seen whether and, if so, how the BGH will express its position on this matter.