In a judgment dated 26 October 2016, the Court of Justice ruled that advertisements which particularly highlight only part of the total price can be considered a misleading practice or omission within the meaning of the Unfair Commercial Practices Directive. In the assessment of a misleading omission, the national court should take into account the limitations of the communication medium used, but only to the extent that it was impossible to include all material information in the initial communication.
A provider of digital television packages in Denmark conducted an advertising campaign for its subscriptions aimed at consumers, using media including advertisements shown on television, banner ads on the internet and the homepage of its website. The provider divided the price for its subscriptions into several components. Only the first component, the monthly charge, was particularly highlighted (in the centre of the screen, in a circle, in a large font size, etc.). The other component of the price, the six-monthly charge, and the total price were omitted entirely, or presented in a less conspicuous manner (at the bottom of the screen, in a small font size, with low contrast, etc.).
Against this background, the Court of Justice ruled on the question whether a subscription offer which highlights only part of the price is to be considered a misleading practice or a misleading omission in the meaning of Directive 2005/29/EC of 11 May 2005 concerning unfair business-to-consumer commercial practices.
Misleading commercial practice
The Court ruled that, in order to determine whether the aforementioned advertisements should be considered a misleading practice, the national court must assess whether, based on their general presentation, they could give the average consumer the mistaken impression that he only has to pay the highlighted monthly charge for the subscriptions offered, and hence could cause or be likely to cause the consumer to take a transactional decision that he would not have taken otherwise.
According to the Court of Justice, the national court should consider the following elements during this assessment:
- the wide variety in the offer of the subscriptions and their complex composition (as to price and content), which is likely to confuse consumers, and
- the fact that the omitted or less visible component of the price represents a significant part of the total price. The price is, in general, a determining factor in the mind of the average consumer when he has to make a transactional decision.
Lastly, the Court emphasised that limitations of space or time related to the communication medium used cannot be taken into account in the assessment of a misleading practice.
Misleading omission
In order to determine whether a misleading omission can be established in the aforementioned advertisements, the national court must assess whether:
- the information concerning (part of) the total price is entirely omitted, or, although the total price is mentioned, it is hidden or provided in an unclear, unintelligible, ambiguous or untimely manner, which prevents the consumer from understanding that a subscription involves costs other than the monthly charge, and
- it causes or is likely to cause the consumer to take a transactional decision that he would not have taken otherwise.
The Court emphasised that, during the assessment of a misleading omission, the national court must take into account the limitations of space or time related to the medium used and the measures taken by the trader to make the information available by other means, such as:
- the time constraints that apply to television commercials, and
- the provision of a reference to the trader's website, where the total price is indicated.
The Court specified that, having regard to the characteristics of the product and the medium used, it must be actually impossible for the trader to provide all the material information on the subscriptions (clearly, intelligibly and unambiguously) in the initial communication, in order for the trader to be allowed to mention only some of them, and the trader must refer to its website which contains all this material information.
Author:
Tim Van Regenmortel
