Definition and meaning of fineness
The term fineness (English: fineness) describes the proportion of precious metal in an alloy or object. Fineness is usually specified in parts per thousand and is a key characteristic for precious metals such as gold, silver, platinum, and palladium. A fineness of 999, for example, corresponds to a purity of 99.9%. Fineness is not only relevant in commercial trade but is also regulated by various legal provisions and is legally binding.
Legal basis for fineness in Germany
Legal definition and regulations
In Germany, the fineness of precious metals is specifically regulated by the Act on the Fineness of Gold and Silver Goods (FeinGehG), also known as the Fineness Act, as well as by technical standards. The specifications for indicating fineness are set out in provisions regarding the labeling and control of precious metals, as regulated in the Fineness Act and the associated regulations. Provisions from the German Civil Code (BGB) and the German Commercial Code (HGB) may also be relevant for the definition, determination, and legal assessment of fineness.
Fineness Act (FeinGehG)
Das Fineness Act sets out the permitted fineness levels and their representations. Only octaved fineness designations (e.g., 333, 585, 750 for gold) are legally permitted. The labeling obligation arises from § 2 FeinGehG: Anyone placing precious metal goods on the market must indicate the fineness exactly. Mislabeling is punishable (§ 7 FeinGehG) and can be prosecuted as an administrative offense or criminal act.
Marking and hallmarking rights
Under German law, marking precious metals and their products with their fineness is subject to strict legal requirements. This includes hallmarking (imprint of fineness onto the metal) and the obligation that markings must not be used in a misleading manner.
Provisions in the European context
The legal requirements for fineness are largely harmonized with the regulations of the European Union, primarily through the EU Directive 76/769/EEC and the provisions of the European standard EN 1811. In the course of harmonization, minimum requirements and permitted designations for fineness have been standardized at the European level.
Importance of fineness in commercial transactions
Fineness in sales contract law
In the context of purchase law (§§ 433, 434 BGB), a fineness-related specification constitutes a guaranteed product characteristic. If the actual fineness deviates from the stated value, this constitutes a defect, which may give rise to warranty claims—from rescission to reduction and compensation for damages.
Fineness in precious metals trading
In wholesale and intermediate trade with precious metals, indication of fineness is customary and mandatory under trading customs. Fineness specifications serve for objective quality determination and are crucial for price formation and contract execution.
Fineness and consumer protection
Consumer protection in connection with fineness aims in particular to prevent misleading statements and fraud. The requirements for truthfulness and clarity in indicating fineness are strict; violations may be prosecuted under § 263 StGB (fraud), the Fineness Act, and the Act Against Unfair Competition (UWG).
Fineness in case law
German courts consistently implement the statutory requirements on fineness in their case law. Disputes often concern correct marking, admissibility of certain fineness specifications, and handling of deviations in actual precious metal content. The courts apply strict standards regarding the obligations of those placing goods on the market and of traders.
Measurement and testing of fineness
Testing methods and technical standards
Fineness determination can be carried out using several analytical methods, including classic acid tests, X-ray fluorescence analysis, atomic spectrometry, or electrochemical methods. Technical standardization and accreditation of testing institutes are subject to legal requirements to ensure the reliability of fineness determination.
Regulatory authorities
Monitoring compliance with the legal provisions on fineness in Germany is the responsibility of various authorities, particularly the calibration offices and the Surveillance Office for Fineness. These authorities are authorized to carry out random inspections and tests and to sanction violations.
International regulations on fineness
Harmonization and differences
Worldwide, there are different regulations regarding the specification of fineness. While the metric fineness standard predominates in many countries, the carat system is often used in Anglo-Saxon jurisdictions. International agreements, in particular between EU states and Switzerland, serve mutual recognition of fineness labeling.
Sanctions for violations of fineness regulations
Violations of statutory fineness regulations carry civil, administrative, and criminal consequences. Sanctions range from fines to imprisonment in the case of fraud (§ 263 StGB). Claims for injunctive relief and damages under competition law may also be triggered.
Importance of fineness in other areas of law
Inheritance law and tax law
In inheritance and tax law, fineness is relevant when valuing estates, particularly regarding inheritance or gift tax if precious metals are part of the estate assets to be valued.
Customs and foreign trade law
In cross-border trade in precious metals, the declared fineness plays a role in tariff classification and taxation. EU customs tariffs and international trade classifications are sometimes linked to fineness levels.
Summary
Fineness is a legally regulated key characteristic of precious metals. The specification, verification, and monitoring of fineness are subject to comprehensive statutory requirements in German and international law. Legal consequences for breaches range from civil warranty claims to criminal penalties. Thus, fineness is a legally relevant and protected quality parameter in commercial transactions, consumer protection, and various other legal fields.
Frequently asked questions
Which legal provisions regulate fineness in Germany?
The fineness of precious metals, especially in the manufacture and placing on the market of precious metal goods, is regulated in Germany by various statutory provisions. Key among them are the Act on the Fineness of Gold and Silver Goods (Fineness Act – FeingehaltsG) and the related Fineness Regulation (FeingehaltsV). These regulations specify the minimum requirements for the indication and verification of fineness. Breaches of the labeling requirement or placing falsely declared precious metal goods on the market may constitute administrative offenses under § 10 FeingehaltsG and may be punished with fines. International standards, such as ISO standards for precious metals, also apply if adopted into German law or introduced via EU law.
Who is required to indicate fineness under German law?
Under German law, manufacturers, importers, and traders who place precious metal goods (e.g., jewelry, coins, cutlery) on the market for the first time are required to indicate the fineness correctly. According to §§ 1 and 4 FeingehaltsG, this obligation applies in particular when the product is advertised or labeled with a fineness. Indication must be in the form of a clearly visible and permanent stamp, with the precise figure required, such as “750” for 75% gold content. If the product is offered solely without a fineness specification, there is no obligation to mark it, but misleading statements are still prohibited.
What sanctions apply for breaches of legal provisions on fineness?
Breaches of legal requirements concerning fineness can result in various sanctions under German law. The Fineness Act generally provides for administrative offenses that can be punished with fines. Sanctionable offenses in particular include the false indication of fineness, missing or inadmissible markings, or placing products on the market whose actual fineness is lower than specified. In addition, repeated or particularly serious violations may lead to competition law warnings, injunctions, or—in extreme cases—criminal investigations for fraud.
How is fineness controlled and monitored by German authorities?
In Germany, monitoring compliance with legal provisions on fineness is primarily the responsibility of the calibration offices or competent state authorities. These conduct random inspections at manufacturers, importers, and retailers. Such controls verify whether the fineness specified on products matches the actual metal content and whether the required labeling has been properly applied. If discrepancies are identified, authorities may impose measures up to confiscation of goods and fines. Furthermore, European market surveillance structures (e.g., RAPEX) may also apply, particularly for imports from third countries.
What special legal rules apply to the fineness of investment gold and silver?
For investment gold (as defined by § 25c UStG and the EU VAT Directive), there are certain specific tax and regulatory provisions. Legal recognition as investment gold requires a minimum purity: at least 995/1000 for bars and at least 900/1000 for coins, with further criteria relating to tradability and minting. Such rules do not apply to investment silver to the same extent, but fineness-related specifications and controls are also required if the fineness is specified. Only if the statutory requirements are met can investment gold, for example, be sold VAT-free. Breaches of these provisions may have tax consequences.
How is fineness treated from a legal perspective in jewelry?
In the jewelry sector, there is an express obligation to mark the fineness if it is specified or advertised, as per the Fineness Act and Fineness Regulation. The marking must be permanently affixed using a hallmark. Concealing the fineness is not prohibited, as long as no misleading statements are made. Mixed alloys must also be labeled with the respective fineness corresponding to their weight. Jewelry that does not meet the specified fineness is subject to the aforementioned sanctions. Special rules may arise from international trade agreements governing mutual recognition of hallmarking, such as under the Vienna Convention.
What role do legal provisions on fineness play in online trading?
The same statutory requirements apply in online trading as in brick-and-mortar retail. Online shop operators must label precious metal goods truthfully and demonstrably regarding their fineness if it is specified. Misleading statements or advertising a higher fineness than is actually present constitutes unfair competition and can have not only administrative but also civil consequences. The burden of proof in the event of a dispute lies with the supplier. Market surveillance authorities are increasingly monitoring online trading and responding to tips from consumers and competitors.
