Comparative Advertising Directive does not ban groceries comparisons, rules ECJ

A ban on such advertising would undermine the purpose of the Comparative Advertising Directive, the Court said.

Supermarket chain Lidl objected to an advert published in France by rival nearby shop Leclerc. The advert, which appeared in a local newspaper, depicted till receipts from the two companies comparing prices on lists of groceries. The bill for the items at Leclerc was less than that at Lidl.

Lidl said that this broke French laws based on the Directive. It said that it deceived and misled consumers by listing products from each shop that were not comparable.

"The reproduction alone in the advertisement at issue of till receipts showing the list of the products compared does not enable consumers to perceive the specific characteristics of those products or, therefore, to understand the reasons for the differences in prices claimed in the advertisement," said an ECJ description of Lidl's case.

"Two products which are not the same may be compared, provided that they meet the same needs or are intended for the same purpose and, in that regard, are sufficiently interchangeable, which is the case here," said its description of Leclerc's counter-argument.

The Directive allows companies to compare their products or services to those produced by rivals as long as adverts are not misleading.

The Directive says that: "comparative advertising shall, as far as the comparison is concerned, be permitted when the following conditions are met: it is not misleading ... it compares goods or services meeting the same needs or intended for the same purpose; [and] it objectively compares one or more material, relevant, verifiable and representative features of those goods and services, which may include price".

The ECJ ruling said that the purpose of the Directive "is to achieve a balance between the different interests which may be affected by allowing comparative advertising".

It said: "the aim of [the Directive] is to stimulate competition between suppliers of goods and services to the consumer’s advantage, by allowing competitors to highlight objectively the merits of various comparable products while, at the same time, prohibiting practices which may distort competition, be detrimental to competitors and have an adverse effect on consumer choice".

It said that the law forced a presumption on the Court in favour of allowing comparative advertising.

"[The Directive] must be interpreted in the sense most favourable to permitting advertisements which objectively compare the characteristics of goods or services, while ensuring at the same time that comparative advertising is not used anti-competitively and unfairly or in a manner which affects the interests of consumers," it said.

The ECJ said that it would defeat the purpose of the law to demand that similar grocery products had to be exactly the same if they were going to be compared in ads.

"To decide that, unless they are identical, two food products cannot be regarded as comparable within the meaning of [the Directive] would effectively rule out any real possibility of comparative advertising regarding a particularly important category of consumer goods, irrespective of the angle from which the comparison is made," it said.

It said that grocers are capable of being compared even when not identical, but that national courts must make the assessment of where that line is drawn.

It said that the fact that they might differ "cannot preclude the possibility [that] they display a sufficient degree of interchangeability".

"The specific assessments as to whether there is such a sufficient degree of interchangeability between the food products that are the subject of the comparison in the main proceedings fall within the jurisdiction of the referring court," it said.

The Court said that previous cases had ruled that omitting information could also contribute to a finding that advertising broke the law, and that national courts might find an advert misleading if it omitted to mention that one product featured was from a particular brand.

"The same may be true, in some cases, with regard to other features of the products compared, such as their composition or the method or place of production, to which the question for a preliminary ruling refers, where it is apparent that such features may, by their nature, in the same way as the price itself, have a significant effect on the buyer’s choice," it said.

"An advertisement such as that at issue in the main proceedings may be misleading, in particular if it is found that, for the purposes of a comparison based solely on price, food products were selected which, nevertheless, have different features capable of significantly affecting the average consumer’s choice, without such differences being apparent from the advertising concerned," it said.