Is advertising with a location misleading?

May a company advertise with a location at a place other than its registered office if no workplace is maintained at that branch where employees are reachable during ordinary business hours? The Higher Regional Court (OLG) Celle recently had to decide this question of competition law.

A craft enterprise operating in the field of roof coatings rented storage space at a second location, in which it kept work equipment and materials. After renting the premises, the craft enterprise advertised with this location, which a competitor of the company considered misleading. The competitor issued a cease-and-desist letter to the craft enterprise and demanded that it cease the misleading advertising with the second location, as the entrepreneur thereby suggested to the market an economic size that did not actually exist. The craft enterprise, namely, did not have a proper office with fixed contact persons at the advertised location.

The craft enterprise argued that it did have a presence at the advertised location through the storage hall. A company advertising banner was affixed to the outside of the storage hall. During the building season, in the season from March to September/October, at least four employees of the craft enterprise were regularly present at the advertised location, regularly entering and leaving these premises. Mail and telephone calls would be redirected, so that the storage hall could be advertised as a second branch.

Decision of the court

The Higher Regional Court (OLG) Celle decided withUrteil vom 07.07.2015 – Az. 13 W 35/15 – that advertising with a location is misleading and therefore impermissible if no such branch of the craft enterprise is actually maintained there. In the case of an enterprise which offers roof repairs, this is only the case if employees of the enterprise are personally reachable at the advertised location during ordinary business hours.

This misleading nature is regularly also materially relevant if interested parties can be attracted with the prospect of the possibility of such contact – even if only in a warranty case. This is the case here, even if potential customers of the craft enterprise would normally contact it by mail or telephone in order to arrange a personal meeting. The advertising in question suggests to the market that personal contact would also be possible at the advertised location independently of these contact options.

Conclusion

The requirements for advertising locations are industry-dependent. If the market generally expects a contact person on-site, advertising of a location will only be permitted if there are actually contact persons personally present at that business location. If this is not the case, advertising with that location is misleading and therefore impermissible.