COMPETITION• FRENCH LAW • UNFAIR COMPETITION
Under the terms of Article L. 122-1 of the Consumer Code, comparative advertising covers any advertising message that compares goods or services by identifying, implicitly or explicitly, a competitor or goods or services offered by a competitor. To be lawful, such advertisements must be neither deceptive nor likely to mislead the consumer, must relate to goods or services meeting the same needs or having the same objective, and must objectively compare one or more essential, pertinent, verifiable and representative features of such goods or services, which may include price.
Furthermore, comparative advertising must not take undue advantage of the notoriety attached to a trademark, trade name, other distinctive signs of a competitor or to the appellation of origin and protected geographical indication of a competing product; discredit or disparage the trademarks, trade names, other distinctive signs, goods, services, activity or position of a competitor; cause confusion between the advertiser and a competitor or between the advertiser’s and a competitor’s trademarks, trade names, other distinctive signs, goods or services; present goods or services as an imitation or reproduction of a good or service benefiting from a protected trademark or trade name (Consumer Code, Art. L. 122-2). When it satisfies those conditions, comparative advertising can be advantageous in two ways: it stimulates competition between undertakings and allows consumers to become better informed. However, there is also a risk of unfair competition, as shown by the list set out in Article L. 122-2: undertakings may be tempted to try to discredit their competitors under the cover of comparative advertising. Unlike the other types of advertisements which have a purely commercial object, comparative advertising is permitted only to the extent that it is likely to guarantee consumers are given unbiased information about the advantages and disadvantages of the products under comparison. The special provisions of the Consumer Code do not exclude the alternative or cumulative application of Article 1240 of the Civil Code. An advertisement which, by extolling the virtues of the advertiser’s product, downgrades the competitor’s item to the rank of an outmoded product constitutes a disparagement. Similarly, a comparative advertisement is disparaging when it presents the competitor as a bowling pin swaying after being struck by the advertiser’s ball or casts doubts as to the judiciousness of its advertising investments by insinuating that it has mismanaged its advertising budgets or by using terms such as “scam”, “racket” or “cheat” suggesting that the competitor is acting dishonestly towards its customers. On the other hand, a comparison of prices does not in itself entail the discrediting or disparagement of a competitor charging higher prices. To be disparaging, the comparison must be of a misleading or tendentious nature. Such is particularly the case where it only highlights the negative features of a competing product or falsely presents a product as being the only one possessing a particular quality. In all cases the courts must ascertain whether the comparison made is based on appropriate criteria, i.e. on characteristics which are essential, pertinent and verifiable and representative of the services concerned.
In the absence of disparaging characteristics, unlawful comparative advertising may also be sanctioned for non-compliance with the regulations. Advertising that compares products or services that are not objectively identical in terms of essential, pertinent, verifiable and representative characteristics, that excludes from the terms of the comparison elements that are unfavorable to it, that does not meet the criteria of fairness and truthfulness required by Article L. 122-1 of the Consumer Code or that does not make available to consumers the components of the comparison enabling them to verify its accuracy, is unfair.