"Only in participating stores" – Permissible advertising?

Is advertising containing the restriction "All offers are available only in participating stores" contrary to competition law if the advertising also lists stores that do not offer the corresponding sales promotion? The Federal Court of Justice (BGH) had to decide this question of competition law.

The franchisor Fressnapf, known in particular for pet food, advertised special offers in a brochure. The individual stores are operated independently by self-employed enterprises.

The brochure contained the notice "All offers are exclusively non-binding recommended prices and are available only in participating stores". The franchisees were free to decide whether they wished to offer the special promotions. On the last page of the brochure, eight Fressnapf stores were listed with address and telephone number.

A consumer association considers this advertising to be misleading and filed a lawsuit against Fressnapf. The consumer cannot determine which branches are participating in the promotion.

Fressnapf argued that there is no knowledge of which of the franchisees would participate in the promotion.

Decision of the BGH regarding Fressnapf's advertising

WithJudgment of 04.02.2016 – Az. I ZR 194/14the BGH upheld the claim.

The judges in Karlsruhe decided that misleading conduct contrary to competition law exists when price promotions are advertised and it is not made unambiguously clear in which of the listed stores the offers are available.

The court is of the opinion that the consumer gathers from the brochure that the advertised products can be obtained at least in the listed branches.

The insufficient information about the stores participating in the sales promotion could lead consumers to visit one of the named stores. Consumers would not have made this business decision if they had known that the store they visited was not participating in the sales promotion.

Conclusion

An advertising company should therefore by all means fulfil the prescribed information obligations. Franchisors should indicate in product advertisements in which markets the advertised offer is actually available and provide the corresponding addresses.