Advertising is said to drive commerce. It comes with the territory, as the real trick is not just to manufacture, but to sell at a profit. A well-planned and skilfully executed advertising campaign can add to a product’s or service’s success. While most entrepreneurs compete fairly and ethically, in terms of advertising as well as commerce, some may turn to cutting corners. We would like to share our observations about unfair advertising, which qualifies as tortious unfair competition.
The Polish Unfair Competition Act addresses unfair advertising in great detail, unequivocally classifying it as a tort, and listing examples of campaigns deemed unfair. Obviously, any advertisement that breaks the law or good custom, or that affronts human dignity, will fall into that category. The law often either prohibits advertising certain product or service types (e.g. tobacco or alcohol), or it strictly regulates such campaigns, as is the case with medical devices or dietary supplements. Advertisements falling short of these rules will be considered tortious unfair competition. In practice, a common infringement is suggesting that a product has features that it in fact does not; for instance, advertising a dietary supplement as guaranteeing certain health benefits, e.g. by claiming that it had been “manufactured like a medicine”, or suggesting that it comes recommended by doctors – while being endorsed by an actor, not an actual physician. Also qualifying as tortious unfair competition is advertising prohibited products or services, such as certain medicinal products or particular medical services (in which case, the adhering entrepreneurs’ business will be in jeopardy).
A not-uncommon example of unlawful advertising, constituting tortious unfair competition, is violating consumer protection laws. The typical violation is misleading advertising, suggesting features that the advertised product or service does not have.
Another unfair advertising category is misleading – playing on potential customers’ emotions by causing fear, using superstition or gullibility, especially that of children.
Yet a further unfair advertising type is seemingly making a neutral claim, while in fact encouraging the purchase of certain goods or services. Such advertisements are, unfortunately, the bread and butter of certain social media influencers, who – under the guise of impartial product reviews – simply advertise particular goods or services. Their claims are not marked as advertising – they are rather meant to come across as neutral information about the products’ features. Such advertisements are somewhat of a double breach – not only do they seem neutral, but they are, more often than not, far from the truth in presenting the advertised product or service. The head of the Polish Competition and Consumer Protection Authority (UOKiK) has already begun addressing this and has fined some influencers, having investigated their campaigns.
A separate category of unfair marketing is comparative advertising; in other words, indirectly or directly enabling the identification of the rival and its goods or services. It is not prohibited per se, unless it breaks good custom. The Unfair Competition Act lists eight requirements that must be met for a campaign to be considered observant of good custom. Classic comparative advertisements – that is, ones directly comparing a particular product to another product of that sort offered by a rival – are more of a rarity these days. A much more popular strategy is advertising one’s product in comparison to “other” products, without specifying their brands or manufacturers, including superlative advertising – “our product is the best”, “No. 1 among…”, etc. Such campaigns do not fall into the comparative category, but they may be viewed as unfair – especially if the advertised product does not have the claimed features.
What can be done if other businesses resort to unfair advertising? First, it must be realised that, by law, the legitimacy of a claim does not depend on whether such advertising had targeted the claimant specifically. Pursuant to the Unfair Competition Act, they have cause for action if their interests have been “breached or threatened”. Therefore, if a rival has used unfair advertising by attributing nonexistent features to their own products, the claimant may reasonably deem their interests breached or threatened – the competitor is trying to unlawfully get the upper hand. In that case, there are several courses of action to consider. An obvious choice would be a cease-and-desist suit, together with a claim in damages and a request to release the illegally earned proceeds. Such a suit may be filed in tandem with an injunction request, which may be significant especially when it comes to refraining from unfair advertising.
As an additional measure, claimants may consider notifying the authorities of such advertisement having been used. Like we said earlier, unfair advertising may also violate industry regulations (as is the case with dietary supplements) or consumer protection laws (since certain advertisement types may infringe on consumer groups’ interests). Then, the state authorities may step in, causing such unfair advertisement to be discontinued and the perpetrating entrepreneur to be fined.