Comparative Advertising – Consideration for Referencing a Competitor in Your Marketing Material

Many businesses produce advertisements that compare their products or services to those of competitors, aiming to demonstrate that their offerings are superior, more affordable, or possess other advantages. This method of advertising is subject to complex legislative controls, and through case law, the courts have provided guidance on what may or may not be lawful.

Broadly, comparative advertisements are permitted under The Business Protection from Misleading Marketing Regulations if the following conditions are met:

1. Not be misleading. This is assessed through the consumer's perspective, and many factors are considered. For example, how prices are calculated – it would be misleading to compare the monthly costs for a TV subscription service with no continued obligation against one where there is a compulsory 12-month contract.
   
   
2. Compare products or services meeting the same needs or intended for the same purpose. The rules were relaxed somewhat in 2013 to allow prices to be compared for products that may not be identical but nevertheless meet the same needs or have the same intended purpose. For example, supermarkets can compare the price of their economy cornflakes with a competitor's premium cornflakes, although comparison of different-sized boxes should be avoided.
   
   
3. Objectively compare one or more material, relevant, verifiable, and representative features of those goods and services, which may include price. An advertiser should be able to supply robust evidence to back up any claims made, e.g. a claim that a product 'kills 99% of bacteria" should be verifiable by reports from reliable tests.
   
   
4. Not create confusion among traders, namely:

• between the advertiser and a competitor, or
• between the advertiser's trade marks (inc. trade names or other distinguishing marks) or goods or services and those of a competitor.
  Mere reference to a competitor's mark would not be contrary to this condition, provided that the advert clearly promotes one's own products rather than a competitor's. As an example, Hutchison used moving pictures of bubbles in one of its adverts to imply that its mobile phone services were cheaper than O2's; it was found that this did not give rise to a likelihood of confusion between the two parties, since it was unlikely anyone would believe Hutchison was selling O2 services.

5. Not discredit or denigrate the trade marks, trade names, other distinguishing marks, products, services, activities, or circumstances of a competitor. For example, an advert showing a dog urinating on a competitor's product was found to be in breach of this condition.
   
   
6. For products with designation of origin, it must relate in each case to products with the same designation. For example, 'Cornish Clotted Cream' is limited to products produced, processed, and prepared from milk produced in Cornwall, etc., so a comparison made against creams that do not meet those criteria would not be acceptable.
   
   
7. Not take unfair advantage of the reputation of a trade mark, trade names, other distinguishing marks of a competitor or of the designation of origin of competing products. For example, if an advert implies that the advertiser and a competitor have some sort of connection (e.g. a sister company), where there is, in fact, none, this will likely be deemed as taking an unfair advantage.
   
   
8. Not present goods or services as imitations or replicas of goods and services bearing a protected trade mark or trade name. This condition applies even if the advert is not misleading and the goods being advertised are clearly not counterfeits. The imitation could be implicit or explicit (e.g. naming a competitor in an advert would be explicit) and need only relate to a part of a product (e.g. imitate only the smell of a competitor's perfume). Therefore, as an example, an advert naming a particular leading brand perfume and claiming one's own smells exactly the same should be avoided, even if the latter is sold under a very different name in a very different style bottle.

It is worth noting that an advert could fall foul of the Regulations even if the competitor's name or its products are not specified. For example, Dyson successfully complained against an advert for a vacuum cleaner claiming to have 50% more suction power than the "leading upright in the UK." In this case, there was an implicit reference to a Dyson vacuum model, and the suction power claimed was untrue and, therefore, misleading.

Comparative advertising straddles many different areas of law, so even if an advert is not in breach of the conditions set out in the Regulations, the aggrieved party may nevertheless be able to seek relief through other means, such as trade mark infringement, passing off, copyright infringement, trade libel, malicious falsehood, etc.

If you have any questions or require advice on advertisements or trade mark matters, please contact our Trade Mark team at mail@stratagemipm.co.uk.