Still nowadays people get shocked when they see a comparative advertisement.
If you saw one of your competitors comparing its products to yours on a TV commercial, your first reaction would probably be: “that is not fair”!
Well, the truth is that at least in Spain, comparative advertisement can be not only fair, but also lawful.
1. The product comparison on advertisements
Article 10 of the Spanish Unfair Competition Law 3/1991 establishes that the acts of public comparison (including comparative advertising), by means of identifying a competitor explicitly or by implication are lawful if the following requirements exist:
a. The goods or services compared are intended for the same purpose or meet the same needs.
b. The comparison is made objectively between one or more relevant, verifiable and representative features of those goods and services (the price could be one of those features).
c. In cases of products with designation of origin, geographical indication, specific designation or guaranteed traditional specialty, the comparison may only be made with others with the same designation.
d. Goods or services cannot be presented as imitations or replicas of other goods or services to which a protected trade mark or trade name applies.
e. The comparison may not infringe the provisions on misleading or denigrating acts or acts gaining unfair advantage from the reputation of others
This means that only if all of these conditions are fulfilled, the comparative advertising will be lawful.
2. The use of a trademark with no authorization
There have been a lot of famous cases of comparative advertisement, such as Minute Maid vs. Don Simon, Coca-Cola vs. Pepsi and McDonalds vs. Burger King.
If you were one of the companies mentioned above, and you saw your competitor making comparative advertisement regarding your products, your second remark would probably be: “hey, they are using my well-known trademark to make money”!
As you will probably know, if you are the holder of a registered trademark, you have the right to use exclusively your trademark and to prevent its use with no authorization by others. This general rule is stated in Article 34 of the Spanish Trademark Law.
However, there is an exception to this rule in comparative advertisement: it is lawful to use the sign of a competitor as long as the requirements of the comparative advertising are fulfilled. That is the terms of the abovementioned Article 10.
As stated in the Directive 2006/114 concerning misleading and comparative advertising, it can be indispensable, in order to make comparative advertising effective, to identify the goods or services of a competitor, making reference to a trademark or trade name of which the latter is the proprietor. Such use of another’s trademark, trade name or other distinguishing marks does not breach this exclusive right in cases where it complies with the conditions laid down by the Directive.
This is also established by the Case Law of the Court of Justice of the European Communities (now the Court of Justice of the European Union). Such as the “Limited O2 Holdings Limited” and the “L’Oréal S.A.” cases.
3. Possible solutions
What to do if some of the requirements above are not reached?
If you consider that someone is doing unlawful advertisement with your products, you can sue the offender, taking one or more of the legal actions provided in Article 32 of the Unfair Competition Law. For example, you can request to the Court to order the cessation of the advertisement or the rectification of the misleading, inaccurate or false information stated in it.
No matter which action of unfair competition you may choose, remember that it is up to the defendant to prove the accuracy and veracity of the indications and statements made in the advertisement.
Santiago Nadal
