Communication of false information to only one consumer is misleading commercial practice

C-388/13

UPC Magyarország

Marketing: Unfair commercial practices

16 Apr 2015

The matter at hand

The Hungarian consumer protection authority ordered UPC to pay a fine of some EUR 85 in respect of an unfair commercial practice within the meaning of the Unfair Commercial Practices DirectiveDirective No 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 for incorrectly informing a subscriber to its cable television services that the last invoice he received related to the period up to 10 February 2011, whereas, as was discovered later, the invoice related to the period up to 14 February 2011. As a result of this incorrect information the subscriber in question, Mr Szabó, had switched to another provider with effect from 10 February 2011 instead of 14 February 2011, causing him to incur the costs of two different subscriptions in the overlapping period of four days. This had cost him an additional payment of some EUR 18.

Although UPC did not dispute the fact that it had provided incorrect information, it did object to the imposition of a fine, arguing that the communication of false information on one occasion to a single consumer cannot be regarded as an unfair commercial practice under the Unfair Commercial Practices DirectiveDirective No 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.

The judgment of the ECJ

The ECJ first of all points out that the EU legislature conferred a very broad meaning on the term ‘commercial practice’, defining it as “any act (…) by a trader, directly connected with the promotion, sale or supply of a product to consumers” (Article 2(d)) “before during and after a commercial transaction” (Article 3(1)), therefore also covering “the communication of information, as in the main proceedings, made by an undertaking in the context of the after-sales service relating to a subscription to cable television services by an individual” (paragraph 37).

Secondly, the ECJ refers to Article 6(1) which provides that such commercial practice is to be regarded as misleading if it contains false information causing the consumer to take a commercial decision that he would otherwise not have taken. The ECJ finds that all the factors set out in that provision are present in the situation at issue in the main proceedings, which is “characterised by the fact that a consumer received from a professional (…) erroneous information as to the duration of the relationship between the two parties, and by the fact that the mistake made by the undertaking prevented the individual from making an informed choice and, moreover, occasioned him additional costs” (paragraph 40).

Regarding UPC’s assertion that in the case at hand it concerned an isolated and unintentional act which affected only one single consumer, the ECJ considers that the relevant provisions do not contain any indication that the act on the part of the professional must be recurrent or must concern more than one consumer. “In the light of the need to protect consumers which underlies that directive, those provisions cannot be interpreted as imposing conditions of that kind where they do not even set out such conditions explicitly (…)”(paragraph 43). Furthermore, the ECJ remarks that imposing such conditions would require the consumer to establish that other individuals have been harmed by that same professional, which would be extremely difficult to prove (paragraph 46). As to the unintentional nature of UPC’s conduct the ECJ holds that “Article 11 of the Unfair Commercial Practices DirectiveDirective No 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 expressly provides that the application of measures taken by the Member States in order to combat such practices is independent of evidence of intention, or indeed negligence, on the part of the professional” (paragraph 48). The fact that the consumer could himself have obtained the correct information is irrelevant as well: “The objective of the Unfair Commercial Practices DirectiveDirective No 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, which is to protect consumers in full against practices of that kind, relies on the assumption that, in relation to a trader, the consumer is in a weaker position, particularly with regard to the level of information” (paragraph 53).

Commentary

Although this is not the first time that the wish to ensure a high level of consumer protection leads the ECJ to confer a wide scope on the Unfair Commercial Practices DirectiveDirective No 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, it is remarkable that the ECJ extends the reach of the Directive to isolated acts directed to one single consumer. Other than the ECJ seems to imply, the wording of the Directive certainly allows for another interpretation, considering that the term ‘practice’ used in the Directive gives the impression that the relevant conduct must be recurring and/or concern more than one consumer. This was also the opinion of the Advocate General in this case, who for a “manifold” of reasons did not consider it feasible to apply the Directive to conduct directed to one single consumer. The ECJ however went the other way with the result that undertakings now risk incurring fines for isolated and unintentional mistakes affecting only one consumer.