In this circular, we shall examine in more detail the judgment of the Court of Justice of the EU in the case of Trento Sviluppo srl, Centrale Adriatica Soc. coop. arl v. Autorità Garante della Concorrenza e del Mercato (C-281/12) of 19 December 2013, which, in our view, may have important implications for the interpretation of provisions of Czech law. In this decision, the Court of Justice of the EU addressed the interpretation of Article 6(1) of Directive 2005/29/EC of the European Parliament and of the Council of 11 May 2005 concerning unfair business-to-consumer commercial practices in the internal market and amending Council Directive 84/450/EEC, Directives 97/7/EC, 98/27/EC and 2002/65/ES of the European Parliament and of the Council and Regulation (EC) No 2006/2004 of the European Parliament and of the Council (hereinafter referred to as the “Directive on Unfair Commercial Practices” or the “Directive”).

The translation of that provision contained in the Czech version of the Directive reads: “A commercial practice shall be regarded as misleading if it contains false information and is therefore untruthful or in any way, including overall presentation, deceives or is likely to deceive the average consumer …, even if the information is factually correct, and in either case causes or is likely to cause him to take a transactional decision that he would not have taken otherwise…”

The conclusions reached by the Court are therefore particularly relevant for the interpretation of the concept of “misleading action” or “misleading commercial practice” within the meaning of Article 6(1) of the Directive on Unfair Commercial Practices. They will therefore be important for the interpretation of the legal regulation of both the new Civil Code (Act No. 89/2012 Coll., the Civil Code, as amended), where misleading advertising and misleading designation of goods or services are defined in Sections 2977, 2978 and 2979 within the legal regulation of unfair competition, and the regulation contained in Act No. 634/1992 Coll., on Consumer Protection (hereinafter referred to as the “Consumer Protection Act”), which implements the said Directive. According to Section 5 of the Consumer Protection Act, a misleading commercial practice falls under an unfair commercial practice, whereby “a commercial practice is unfair if a trader’s conduct towards a consumer is contrary to the requirements of professional diligence and is likely to materially distort his decision-making so that he may take a transactional decision that he would not have taken otherwise.”

According to Section 6 of the Consumer Protection Act, a commercial practice is misleading: a) if false information is used therein, b) if the important information is in itself truthful but may mislead the consumer having regard to the circumstances and context in which it was used, c) if the trader omits to provide important information which, having regard to all the circumstances, may reasonably be required of the trader; the provision of important information in an unintelligible or ambiguous manner shall also be considered an omission, or d) if the manner of presentation of a product or service, including comparative advertising, or their marketing leads to confusion with other products or services, or the distinguishing marks of another trader, e) if a commitment contained in a code of conduct to which the trader has committed himself to comply is not observed, where this is a clear commitment which can be verified and the trader states in the commercial practice that he is bound by the code.

Offering or selling products or services infringing certain intellectual property rights, as well as storing such products for the purpose of offering or selling them, furthermore the unauthorised use of a designation protected under a special legal regulation in commercial dealings, and finally, a practice listed in Annex No. 1 to the Consumer Protection Act shall always be considered a misleading commercial practice.

In the case in question, the issue for assessment was whether a commercial practice must be considered “misleading” within the meaning of Article 6(1) of the Directive on Unfair Commercial Practices solely on the ground that that practice contains false information or that it is likely to deceive the average consumer, or whether it is also necessary that the said practice be likely to cause the consumer to take a transactional decision that he would not have taken otherwise.

Trento Sviluppo srl and Centrale Adriatica Soc. coop. arl are part of the COOP Italia group, and in certain COOP Italia retail outlets a special promotional offer was presented, under which selected products were offered at advantageous prices during a certain period of time. Subsequently, a complaint was lodged by a consumer that a specific product (a laptop computer) was not available at the time the promotion was valid when he visited the supermarket. As already outlined above, the subject of the dispute in the proceedings before the Court of Justice of the EU was the interpretation of whether, in the case of a misleading commercial practice, it is necessary that, in addition to the incorrectness and the ability to deceive the consumer, it should also be likely to cause the consumer to take a transactional decision that he would not have taken otherwise (i.e. to engage in certain economic behaviour).

The Court concluded that, since misleading commercial practices under Article 6 of the Directive on Unfair Commercial Practices constitute a specific category of unfair commercial practices referred to in Article 5(2) of the Directive, they must necessarily include all the essential characteristics of an unfair nature. Thus, in order to constitute a “misleading commercial practice”, it must contain either false information or be likely to deceive the average consumer and at the same time be likely to cause the consumer to take a transactional decision that he would not have taken otherwise.

From this perspective, however, the trader would be favoured over the consumer, and therefore the Court adds that the scope of the concept of “transactional decision” must be interpreted, having regard to Article 2(k) of the Directive, as covering not only the decision whether or not the consumer purchases the product, but also decisions directly related to that purchasing decision, such as visiting a shop, thereby significantly improving the consumer’s position.

It therefore follows from the above that the practice of Czech traders will also need to reflect this interpretation within commercial practices used towards consumers.

Barbora Chvalinová Law Firm Mašek, Kočí, Aujezdský www.e-Advokacie.cz – on-line legal advice

This text was originally prepared by the law firm Mašek, Kočí, Aujezdský in cooperation with the Association for Electronic Commerce (APEK) as legal circular No. 3/2014 intended for members of this association.

This text was translated from Czech to English using an AI translator.