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The Interpretation of the Blacklisted Prohibitions: The Work Is Going at a Snail's Pace

According to the Commission, the blacklist in Annex I was drawn up to enable enforcers, traders, marketing professionals and customers to identify commercial practices which are to be considered unfair in all circumstances and are therefore prohibited.[1] Eight years after the adoption of the UCP Directive it is justified to ask whether it is at all feasible to identify such blacklisted practices.

Annex I to the UCP Directive was intended to be written in user-friendly language for the benefit of consumers, businesses, judges and enforcement officials.[2] Yet, it becomes evident already at first glance that this plan has failed. The prohibitions are dubious because of the use of unclear, imprecise and undefined notions such as 'reasonable period' (point 5), 'reasonable quantities' (point 5), 'normal market conditions' (point 18) or 'failing systematically to respond' (point 27). The blacklist unnecessarily employs different synonymous expressions -e.g., 'create impression' (point 9), 'create false impression' (point 23) or 'give impression' (point 21), 'passing on information' (point 18) or 'informing' (point 30), 'stating' (point 7) or 'claiming' (point 1). This in turn raises questions regarding their uniformity and coherence. Some superficially comprehensible prohibitions later turn out to be problematic because of the undefined scope of the notions used therein, such as 'children' (point 28) or 'the ability to cure illnesses' (point 17).

All complications caused by an imperfect legislative technique are multiplied by the existence of the diverse translations of the UCP Directive, each of which is equally binding. In the Polish version of Annex I, for example, the notion 'claiming' (twierdzenie) is used in those points of the blacklist[3] where the English version uses both 'claiming'[4] and 'stating'.[5] However, 'claiming' is used in the English version also in point 1, where the Polish version uses a different term (podawanie sie). All the points where the Polish version uses a single notion for the English 'claiming' and 'stating', are handled similarly in the German version (Behauptung) which, then, additionally uses this term in point 1, but not in point 19.

Last but not least, there are not only disparities to be noticed in relation to Annex I as such, or between its different translations. Significant are also differences between Annex I and the national blacklists. The Polish act uses, for example, the term 'contrary to the truth' (niezgodne z prawdq) while the Polish version of Annex I uses in the same prohibitions the notion 'contrary to reality' (niezgodne z rzeczywistosciq). The German UWG chose the notion 'goods and services' (Waren und Dienstleistungen) in lieu of the notion 'product' (Produkt) used in the German version of Annex I. The superficiality of such modifications is, however, not always the rule. For example, the German UWG prohibits promoting goods and services similar to a product made by a particular competitor (Mitbewerber), while the blacklist in Annex I bans promoting goods and services similar to a product made by a particular manufacturer (point 13). Such a small linguistic change made in the national regulation considerably changes the scope of a prohibition and, consequently, the scope of a national blacklist. As a solution, an appropriate interpretation[6] or even a modification[7] of point 13 of the Annex to the § 3(3) of the UWG is called for.

The results of a linguistic analysis go beyond simple academic discourse. Numerous unclear notions used in Annex I increase the risk of false implementation.[8] The diverse interpretations of the national blacklists create the possibility of an incoherent application and enforcement of the per se prohibitions. A commercial practice might thus be assessed as falling within the scope of Annex I in one Member State, while the same might not hold true in another. Even if this effect may be seen as inevitable for any directive transposed into national legislation, it is certainly contrary to the aim of the full harmonization and the blacklist as its ultimate expression. If the blacklist is meant to clear the market from 31 unfair commercial practices, a uniform application of the national blacklists should be considered.

The notions of the blacklists should only to a limited extent be interpreted in the light of the rulings and doctrinal interpretations dating back to the time before the UCP Directive was adopted, even though the national prohibitions might have previously covered similar commercial practices. Such a tendency, however, is visible both in Poland[9] and in Germany.[10] The national terms of Annex I should develop into autonomous European notions. Even if it were easier for the national enforcer to use only the national regulation,[11] one has to bear in mind that the terms devised at the supra-national level are meant to facilitate the uniform application of the per se prohibitions in all Member States.

In the light of the above, it seems more than surprising that only two ECJ judgments so far dealt with the interpretation of a prohibition from Annex I itself and, remarkably, the first ruling was handed down more than 7 years (!) after the adoption of the UCP Directive.

The ECJ in the Purely Creative and Others judgment deals with point 31 of Annex I which prohibits in all circumstances an aggressive commercial practice consisting of creating the false impression that the consumer has already won, will win, or will on doing a particular act win, a prize or other equivalent benefit, when in fact either there is no prize or other equivalent benefit, or taking any action in relation to claiming the prize or other equivalent benefit is subject to the consumer paying money or incurring a cost.

Without going into details as regards the interpretation of point 31,[12] it has to be emphasized that the Purely Creative and Others case reveals some general rules on how Annex I should be interpreted. Noteworthy is that the literal interpretation of a prohibition, which seems to be the basic method to be applied, may be combined with an analysis of the context of the ban.[13] The ECJ also applied a historical interpretation[14] as well as a teleological one, which was far removed from the literal one, since as a result the ECJ reduced the notion 'false impression' to 'impression'.[15] Additionally, as mentioned before, the ECJ has stated that national law must be interpreted in the light of the wording and the purpose of the UCP Directive.[16]

The recent ECJ judgment in case 4finance deals with point 14 of Annex I which prohibits per se an misleading commercial practice consisting of

Establishing, operating or promoting a pyramid promotional scheme where a consumer gives consideration for the opportunity to receive compensation that is derived primarily from the introduction of other consumers into the scheme rather than from the sale or consumption of products.

The doubts raised by the Lithuanian court were based on the inconsistent translations of point 14 of Annex I in different official versions of the UCP Directive. In a short judgment the ECJ confirmed that a pyramid promotional scheme constitutes an unfair commercial practice only where such a scheme requires the consumer to give financial consideration, regardless of its amount, for the opportunity to receive compensation that is derived primarily from the introduction of other consumers into the scheme rather than from the sale or consumption of products.[17]

In the Purely Creative and Others judgment the ECJ made no reference to the Guidance from the Commission on the implementation and application of the UCP Directive, which deals with point 31 of Annex I. Such reference could have served as an indication of the usefulness of the Guidance. Although the Guidance cannot provide a formal interpretation of law, it offers numerous examples of the scope of the UCP Directive. It is, however, disappointing that an explicit interpretation is presented only in relation to points 9, 17, 20 and 31 of Annex I. As for the other per se prohibitions, the Guidance gives only examples of selected commercial practices covered by the blacklist.

Furthermore, to facilitate an analysis of national legislation and judicial practice with regard to the UCP Directive the Commission has developed a webgate (https://webgate.ec.europa.eu/ucp). This website was designed to gather and publicize information relating to the UCP Directive and the national laws transposing the UCP Directive, European as well as national jurisprudence, administrative decisions and references to relevant legal literature.[18] The website also offers a database compiling all implementations of the UCP Directive and all relevant national rulings summarized in English. However, some reservations have to be expressed with regard to how up-to-date and reliable the data collected for the project actually is. At the end of May 2014 only 97 national rulings were found to be related to Annex I, the newest one dates back to 25 January 2013. The way the database classifies the rulings by assigning them to one of the prohibitions in Annex I is also more than questionable as e.g., all rulings linked to point 1 of Annex I deal exclusively with other prohibitions. Nevertheless, the database enables a simplified comparative analysis of the national blacklists by giving enforcers and academics[19] various examples of specific situations in which the blacklists may be applied as well as by illustrating how the specific rules of the blacklist are understood or misunderstood by national courts and administrative bodies.

European activities towards achieving a better understanding and more efficient application of the blacklist are noteworthy, but they progress very slowly. The forthcoming legislative actions at the EU level may, however, decrease their applicability and importance.

  • [1] SEC (2009) 1666, 53.
  • [2] Green Paper on COM (2001), 531 final, 15.
  • [3] Points 3, 4, 7, 9, 15, 16, 17, 19, 22 of the Polish version of Annex I to the UCP Directive.
  • [4] Points 3, 4, 15, 16, 17, 19, 22 of the English version of Annex I to the UCP Directive.
  • [5] Points 7 and 9 of the English version of Annex I to the UCP Directive.
  • [6] Hendrik Schöttle, 'Die Schwarze Liste - Übersicht über die neuen Spezialtatbestände des Anhangs zu § 3 Abs. 3 UWG' (2009) WRP 673, 678; Olaf Sosnitza, 'Anhang zu § 3 Abs. 3 UWG', in Henning Piper, Ansgar Ohly and Olaf Sosnitza, Gesetz gegen den unlauteren Wettbewerb. Kommentar (5th edn, C.H. Beck, 2010), para 33.
  • [7] Helmut Köhler, 'Nr. 13 des Anhangs zu § 3 Abs. 3 UWG', in Helmut Köhler and Joachim Bornkamm, Gesetz gegen den unlauteren Wettbewerb (30th edn, C.H. Beck, 2012), para 13.2; Gunda Dreyer, 'Nr. 13 des Anhangs zu § 3 Abs. 3 UWG', in Henning Harte-Bavendamm and Frauke Henning-Bodewig (eds), Gesetz gegen den unlauteren Wettbewerb (UWG). Kommentar (2nd edn, C.H. Beck, 2009), para 8.
  • [8] Aleksandra Kunkiel-Krynska, Metody harmonizacji prawa konsumenckiego w Unii Europejskiej i ich wplyw na procesy implementacyjne w pahstwach czlonkowskich (Methods of Harmonization of Consumer Law in the European Union and Their Impact on the Implementation Processes in the Member States) (Wolters Kluwer Polska SA, 2013) 356.
  • [9] E.g., Robert Stefanicki, Ustawa o przeciwdzialaniu nieuczciwym praktykom rynkowym. Komentarz (Act on the Prevention of Unfair Market Practices. Commentary) (LexisNexis, 2009) 416-418; Malgorzata Sieradzka, Ustawa o przeciwdzialaniu nieuczciwym praktykom rynkowym. Komentarz (Act on the Prevention of Unfair Market Practices. Commentary) (Wolters Kluwer, 2008) 199.
  • [10] E.g., Stefan Völker, 'Nr. 21 des Anhangs zu § 3 Abs. 3 UWG', in Harte-Bavendamm and Henning-Bodewig (n 72), paras 6-9.
  • [11] Karl-Heinz Fezer, 'Pladoyer fur eine offensive Umsetzung der Richtlinie uber unlautere Geschaftspraktiken in das deutsche UWG' (2006) WRP 781, 782.
  • [12] See Helmut Kohler, '“Gratuliere, Sie haben gewonnen!” – neue Kontrollma?stabe fu?r Gewinnmitteilungen' (2012) GRUR 1211; Christian Alexander, 'Die Rechtsprechung des EuGH zur Richtlinie 2005/29/EG bis zum Jahr 2012' (2013) WRP 17, 23–24; Inge Scherer, 'Massiver Irrtum bei Nr. 17 der “Schwarzen Liste” des UWG-Anhangs?' (2013) WRP 143–146.
  • [13] Case C-428/11 Purely Creative and Others, para 35.
  • [14] Case C-428/11 Purely Creative and Others, para 28.
  • [15] Case C-428/11 Purely Creative and Others, para 29.
  • [16] Case C-428/11 Purely Creative and Others, para 41.
  • [17] Case C-515/12 finance, para 34.
  • [18] ec.europa.eu/justice/consumer-marketing/unfair-trade/unfair-practices/ index_en.htm.
  • [19] See Hans-Wolfgang Micklitz, 'Anhang I', in Münchener Kommentar zum Lauterkeitsrecht (C.H. Beck, 2014), paras 3-8.
 
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