Advertising with discounts and strike-through prices violates competition law according to a ruling by the Munich Regional Court on 10/10/2022 if no appropriate reference value is provided.
Competition law is intended to ensure fair competition and, among other things, to prevent consumer deception. Offers and discounts are a popular means of attracting customers to products. However, when advertising with strike-through prices, an appropriate reference value must be provided so that it does not violate the Act against Unfair Competition (UWG), explains the business law firm MTR Legal Rechtsanwälte, which also advises its clients on competition law.
This is also demonstrated by a ruling of the Munich Regional Court from October 10, 2022. The court classified advertising by a comparison and sales platform with strike-through prices as anti-competitive (Ref. 42 O 9140/22).
The online platform offered perfumes both through third-party providers and direct sales. In doing so, it advertised the perfumes in the overview gallery and on the respective product pages with offers. The total price was compared to a higher struck-through price, and the percentage savings were highlighted with a red discount box. The catch was that the depicted savings always referred to the difference between the most expensive and the cheapest offer on the platform – regardless of which retailer offers the perfume.
The Munich Regional Court sees this portrayal as a violation of § 5 para. 1, para. 2 no. 2 UWG and misleading to consumers, as the supposed discounts lack a clear reference value. Consumers are thus led to believe that it is an especially favorable offer. However, the displayed comparison between the most expensive and the cheapest offer does not constitute a reference value. This presents a high potential for deception, according to the court.
Furthermore, it stated that the strike-through prices used in direct sales violate the Price Indication Ordinance. Contrary to the requirement, the price reduction does not refer to the lowest total price that the platform itself used within the last 30 days before the reduction, but instead refers to the highest sale price on the platform. This is unfair and can disadvantage consumers and competitors, according to the Munich Regional Court.
Lawyers experienced in competition law advise at MTR Legal Rechtsanwälte.
