„Bait” advertising in Polish and German jurisprudence

 

Polish as well as in German case-law regularly raise the issue of the so-called „bait” advertising.

Both legal systems provide for detailed regulations on responsible creation of advertising in order to ensure that the content directed at consumers.

“Bait advertising” describes the situation where an entrepreneur proposes to a consumer the purchase of a product at a certain price without disclosing that it is not able fulfil the order on the offered conditions. The attractive offer is to attract the attention of the recipient, who – attracted by a low price or other favourable conditions – ultimately decided to conclude a contract that they would not have concluded under normal circumstances. Such behaviour is considered unlawful and may be classified as an act of unfair competition or unfair business practice.

Let us consider the positions of Polish and German jurisprudence on this matter.

Bait advertising as unfair market practice – Polish case law example

In the case  that is the subject of the judgment of the Court of Appeal in Warsaw of 27 September 2013, casse no VI Aca 279/13, the claimant accused the defendant, a real estate seller, of violating the obligation to provide consumers with accurate and comprehensive information.

The defendant, focusing mainly on the sale of residential real estate, advertised only net prices in its communications, without including value-added tax. Such advertisements were published in the press and misled consumers as to the actual costs.

The Court of Appeal in Warsaw found the defendant’s behaviour to be a violation of, among others, the Act on Prices, the Act on Protection of Competition and Consumers, and the Act on Combating Unfair Business Practices.

The court underlined the issue of the perspective of the average consumer and the importance of transparent communication in marketing materials, especially for expensive goods such as real estate. It also emphasized the importance and difficulty of making the decision to purchase an apartment. Furthermore, there is a risk that consumers visiting the sales office may be tempted to buy another, more expensive apartment under the influence of attractive advertising, in which they would not otherwise be interested if it were not for the unfair practices of the company.

Bait advertising as an act of unfair competition –  German case law example

 As an example of the German case is the judgment of the Federal Court of Justice of 10 February 2011, case no I ZR 183/09. A consumer protection organisation questioned the practices of a large retail corporation by accusing it of using misleading marketing practices.

The advertisement promoted discounted products such as butter and LCD monitors without adequately disclosing the limited availability of the goods. In both cases, consumers reported almost immediately after the products were introduced into stores that the products could not be purchased due to their unavailability.

Despite information in the advertisements about the limited availability of goods, the court found that they were not sufficient to protect the consumer from misleading perception. Since the contested advertisements did not contain sufficient information about the unavailability of the advertised goods, it is to be assumed without further consideration that they have an anti-competitive character. Such actions was considered an example of typical “bait advertising” intended to attract customers to the store. BGH underlines that the entrepreneur has an obligation to ensure the availability of advertised products at the offered prices for a reasonable period of time.

Summary

In both cases the courts thoroughly analysed advertisements from the perspective of the average consumer and emphasised the importance of transparent and precise information in commercial communication. Both, Polish as well as German court were critical of the use of practices that could mislead consumers. This applies not only to purchases of significant importance, such as real estate (in the Polish case) but also to the purchase of typical consumer goods (in the German case).

Examples from case law draw attention to the obligation of entrepreneurs to ensure that their advertising aimed at consumers are reliable and not misleading, and at the same time comply with the principles of fair competition on the market.

• judgment of the Court of Appeal of 27 September 2013, case no VI ACa 279/13
• judgment of the Federal Court of Justice (BGH) of 10 February 2011, case no I ZR 183/09