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European IP Bulletin, Issue 36, November 2006 - Media & Advertising

9. LIDL Belgium GMBH & CO KG V Etablissementen Franz Colruyt NV

In its recent ruling in Case C-356/04 Lidl Belgium GmbH & Co v Etablissementen Franz Colruyt NV, the European Court of Justice (ECJ) has clarified the comparative advertising rules as set out in the EC Comparative Advertising Directive (97/55/EC).

Lidl Belgium and Colruyt both operate low cost retail chains in Belgium. Colruyt carried out an advertising campaign which contained a shopping comparison between it and three other retailers. The advertisement stated that if a family had shopped with them, instead of Aldi, Lidl or Makro, they would have saved between €155 and €293. Colruyt also claimed that, based on their price checking system, their customers could always enjoy the lowest prices. A complaint was filed by Lidl, and the Belgian court referred several questions to the ECJ asking for a correct interpretation of the Directive.

The ECJ found that it was acceptable to compare two sets of comparable products, and not just pairs of products, as long as its is possible to identify the products and verify the accuracy of comparison. Furthermore, it is not necessary to list the precise details of the comparison in the advertisement, but the ad  should indicate where the details are available. However, it was held that the comparison could be found to be misleading, if it suggested that a comparison had been to all of a competitors’ products when, in reality, only a sample of products had been compared; or if the source of information was not indicated; or if the comparison was made between more than two competitors and there was no indication of the individual prices of each of the respective competitors.

This is quite a practical approach to comparative advertising. It was noted that consumers were likely to be more interested in comparisons on prices of ‘shopping baskets’ than individual products. Furthermore, to require that all comparative advertisements display exhaustive lists of prices and other relevant details, rather than merely stating where that information could be accessed, would make it much more difficult to use comparative advertising.

 

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