Commercial

Term and Definition: Commercial

The term ‘Commercial’ originates from English and in a legal context refers in particular to an advertisement or commercial spot broadcast or published in audiovisual media, on the internet, or on radio. In a broader sense, ‘Commercial’ is also used synonymously for all forms of commercial communication. The legal assessment of commercials covers numerous aspects of advertising, competition, copyright, media, and data protection law.

Legal Basis for Commercials

Competition Law Framework

The publication and distribution of commercials in Germany and the European Union are subject to fair trading laws, in particular the provisions of the Act Against Unfair Competition (UWG). In this context, the following aspects, among others, are regulated:

• Misleading Advertising (§§ 5, 5a UWG): Commercials may not contain misleading statements that are likely to materially influence the consumer’s economic behavior. Statements that deceive about features of goods or services, prices, offers, or contract terms are inadmissible.
• Comparative Advertising (§ 6 UWG): Comparisons with competitors are only permitted if they are objective and not discriminatory.
• Aggressive Commercial Practices (§ 4a UWG): Commercials may not pressure consumers into a decision by means of harassment, coercion, or unlawful pressure.
• Protection of Specific Groups: For certain target groups such as children, adolescents, or particularly vulnerable consumers, stricter requirements apply regarding the clarity and transparency of advertising.

Media Law Restrictions and Requirements

State Treaty on Broadcasting and Media State Treaty

The broadcasting of commercials on television and radio is governed by the provisions of the Media State Treaty (MStV), which contains regulations on advertising time, separation of advertising and programming, and labeling requirements:

• Advertising Time Limitations: Providers may generally use at most 20% of their daily broadcast volume for commercials.
• Separation Requirement and Labeling Obligation: Commercials must be clearly labeled as advertising and must be clearly separated from programming both in content and visually (§ 8 MStV).
• Prohibition of Certain Advertising Content: Prohibited are, among others, commercials for tobacco products, certain medicines, specific political or religious messages, as well as inappropriate influencing of children.

Online Media and Telemedia Act (TMG)

For online commercials, the provisions of the Telemedia Act as well as specific requirements of the General Data Protection Regulation (GDPR) regarding the processing of personal data apply, especially with respect to personalized advertising and tracking.

Copyright Aspects

A commercial can be protected as a cinematographic work or as another work of fine art under the Copyright Act (§§ 2, 88 UrhG). This grants commercials copyright protection, in particular against unauthorized reproduction, adaptation, or public performance.

• Rights of Participants: Copyright and related rights of authors, speakers, composers, and performers must be observed.
• Licensing Rights: The commercial use of music, fonts, images, and videos within a commercial usually requires the acquisition of corresponding usage rights.

Trademark and Significance under Trademark Law

The use of trademarks, protected logos, or business identifiers in a commercial generally requires the consent of the rights holder. Unauthorized use of trademarks may violate the Trademark Act and give rise to injunctive and damage claims.

Data Protection Law Aspects

If commercials are individualized or distributed via personalized, data-driven advertising technologies, data protection regulations apply. Insofar as personal data is collected, processed, or used (e.g., targeting, retargeting), the following regulations in particular must be observed:

• Consent in accordance with Art. 6(1)(a) GDPR: Personalized advertising requires active consent from the affected individual.
• Information Obligations and Transparency: Users must be informed about data processing, purposes, and legal basis.
• Right to Object and Revocation Options: Users who receive commercials must be able to object to the use of personalized advertising.

Broadcast and TV Commercials: Special Requirements

For commercials on television and radio, additional specific advertising guidelines apply (e.g., guidelines of the state media authorities), which contain detailed requirements for the content, design, and scheduling of commercials. In particular, political restraint, youth protection, and advertising bans for certain product groups (e.g., alcohol, pharmaceuticals) are regulated therein.

Liability and Sanctions for Legal Violations

Violations of the aforementioned legal provisions can have civil, administrative, and in some cases criminal consequences:

• Cease-and-Desist Letters and Injunctive Relief: Competitors and associations can issue cease-and-desist warnings and file claims for injunctions in the case of unlawful advertising.
• Damages Claims: If a commercial causes financial losses as a result of legal violations, the injured party can claim compensation.
• Fines and Regulatory Measures: Media regulatory authorities may impose broadcasting bans, fines, and other sanctions for violations.
• Criminal Law Risks: Anyone publishing commercials containing criminal content or deliberately misleading advertising can also be held criminally liable.

International Aspects and Particularities

Commercials are subject not only to national but also to international regulations. In particular, within the EU, the Audiovisual Media Services Directive (AVMSD) sets minimum standards for advertising, sponsorship, and product placement in cross-border contexts.

Conclusion

The term ‘Commercial’ is comprehensively regulated under the law and touches upon numerous legal areas. Anyone producing, broadcasting, or distributing commercials must consider a wide range of legal requirements to prevent legal risks. Compliance with competition, copyright, data protection, and media law provisions is essential for the legally compliant publication of commercials in Germany and within the European Union.

Frequently Asked Questions

Who is liable for compliance with legal requirements when concluding commercial contracts?

In the legal structuring and execution of commercial contracts (e.g., contracts for commercial trade, distribution, or the use of copyrighted works for commercial purposes), both contracting parties are generally responsible for compliance with legal requirements. For certain aspects—such as antitrust provisions, compliance requirements, data protection obligations, or tax regulations—each party has its own duty to inform themselves about and adhere to the applicable laws. However, if specific duties (e.g., obtaining licenses or providing necessary evidence) are assigned to one party in the contract, that party is liable for breaches. Especially in cases of due diligence obligations or warranty declarations, one party may be required to indemnify the other should they breach statutory requirements. It is important to note that certain statutory obligations (particularly in the areas of consumer protection, employment law, or tax regulations) cannot be completely excluded or shifted by contract; any such exclusion is regularly invalid. In the event of damage, the injured party may generally claim damages in accordance with the general principles of contract law.

What legal information obligations must be observed in commercial contracts?

Commercial contracts are subject to numerous statutory information obligations designed to ensure transparency and legal certainty. Depending on the type of contract, these mandatory notifications may arise from the German Civil Code (BGB), the German Commercial Code (HGB), the Act Against Unfair Competition (UWG), or special laws such as the Telemedia Act (TMG) or data protection laws (e.g., GDPR). Information obligations include, for instance, specifying the identity of the contracting parties, a precise description of the contractual subject matter, information about prices, payment and delivery terms, rights of withdrawal (particularly in B2C contexts), warranty and liability provisions, as well as, where applicable, information about the contractual language(s) used and the competent courts. In cross-border commercial matters, country-specific regulations may also need to be taken into account. Failure to fulfill these information obligations can result in cease-and-desist warnings, injunctive relief, and, in individual cases, the invalidity of certain contractual clauses.

What special features must be considered regarding contract form in commercial matters?

Form requirements for commercial contracts generally depend on the subject matter of the contract. While many contracts can be concluded informally (in writing, verbally, by email), certain transactions (e.g., real estate transactions, assignment of registered rights, or sureties) require written form or even notarization. In international commercial law (e.g., under the UN Sales Convention/CISG), there are often relaxations regarding the contract form; nonetheless, important agreements should always be documented in writing for evidentiary purposes. For electronically concluded commercial contracts, the requirements of § 126a BGB (electronic form) as well as the provisions of the eIDAS Regulation must be observed. In addition, larger business partners or corporations often require comprehensive contract documentation and archiving to fulfill internal compliance standards.

What liability and warranty regulations are common and legally binding?

In commercial law, a distinction must be made between statutory liability and individually agreed provisions. Under German law, the contracting party is generally liable according to the general provisions of the BGB for intentional and negligent breaches of duty (§ 280 BGB). Liability may—except in cases of gross negligence, intent, and personal injury—be contractually limited or excluded under certain conditions. The same applies to warranties: in B2B contracts (transactions between companies), liability and warranty can be restricted more broadly than in B2C transactions, where mandatory consumer protection provisions apply. In international trade, liability and warranty terms are often extensively negotiated and should be clearly and unambiguously formulated to avoid subsequent legal disputes.

What antitrust considerations must be observed in connection with commercial contracts?

Commercial contracts must not contain agreements or restrictions that violate antitrust law. In particular, this includes price-fixing, territorial and customer protection clauses, exclusivity agreements, or concerted practices that may impede free competition. Violations of German and European antitrust law (e.g., §§ 1 et seq. GWB, Art. 101 et seq. TFEU) may lead to significant fines, damage claims, and the invalidity of the relevant clauses or entire contracts. Companies should therefore subject all commercial contract clauses to an antitrust review beforehand and seek legal advice in case of uncertainty, especially regarding distribution systems, license agreements, or exclusive cooperation arrangements.

What is the significance of compliance clauses in commercial contracts?

Compliance clauses are increasingly moving into focus in commercial contracts. They require the contracting parties to comply with legal requirements, internal company policies, and international standards regarding anti-corruption, anti-money laundering, data protection, or export control regulations. The inclusion and consistent adherence to compliance requirements is often a condition for establishing long-term business relationships. Breaches can lead to rights of termination, damage claims, and sometimes criminal consequences. Compliance clauses should therefore be formulated precisely and contain rules on monitoring, reporting, and, if applicable, sanctions for breaches.

What role does data protection law play in commercial contracts?

Data protection law, in particular under the European General Data Protection Regulation (GDPR), plays a central role in the structuring and implementation of commercial contracts where personal data is processed. In particular, transparency obligations, data subject rights, and technical and organizational minimum standards for data security must be observed. Where third parties are involved (e.g., subcontractors/cloud providers), additional agreements for commissioned data processing in accordance with Art. 28 GDPR must be concluded. Breaches of data protection requirements can lead to significant fines and recourse claims. The contracting parties should therefore check at an early stage whether, and to what extent, personal data is affected and what data protection obligations result from this.