Advertising claim "Made in Germany" with manufacturing in China?

The Higher Regional Court (OLG) Düsseldorf had to decide the legal question of whether a manufacturer of industrial products, who has the goods distributed manufactured in part in China, is permitted to advertise its products with the country-of-origin indication "Made in Germany".

A manufacturer of tableware advertised its cutlery sets with the indication "Produced in Germany". In an insert leaflet, the cutlery was described as "Made in Germany". The knives of the cutlery set are manufactured in China as raw knives. They are forged, cut, hardened and ground there on machines manufactured in Germany and subsequently polished in Germany. The remaining parts of the cutlery set were manufactured in Germany. The Wettbewerbszentrale (competition watchdog) issued a costly warning to the manufacturer on account of these advertising claims, which it considered misleading, and demanded their discontinuation, which the manufacturer refused.

Court's decision
The Higher Regional Court (OLG) Düsseldorf decided in itsjudgment of 05.04.2011 – Az. I-20 U 110/10, that in the case of industrial products which are advertised with the statements "Produced in Germany" or "Made in Germany", all essential manufacturing steps must have been carried out in Germany. This was not the case here.

Only goods manufactured substantially in Germany or whose value-determining properties stem from German production according to general commercial understanding may be marked as "Made in Germany". The special emphasis of the country of manufacture creates the expectation in the consumer that all parts of the advertised cutlery have been manufactured in Germany. In this regard, a particular quality expectation of the consumer is irrelevant. His motivation could also be based on other reasons, such as, for example, concern for German jobs. In the present case, this therefore constituted an impermissible geographical country-of-origin indication which, from a competition law perspective, is misleading and thus must be discontinued.

Conclusion

This decision by the Higher Regional Court (OLG) makes clear that the lawful use of country-of-origin indications must always be carefully examined in order to prevent costly competition law warnings.