Hey there! Netto's Discount Advertising Under Scrutiny at BGH
The Bundesgerichtshof (BGH) is deliberating on marketing strategies involving price reductions. - Advertising Negotiations for Lower Costs with BGH (Business Group Headquarters)
Things have been heating up between Netto and the Central Office for the Suppression of Unfair Competition over some shady advertising tactics. The former got slapped with a lawsuit back in 2024, and it wasn't a fun time for 'em. The Higher Regional Court of Nuremberg mostly sided with the Office, ruling that consumers were left scratching their heads about just how much they were saving thanks to Netto's ads.
Long story short, the court found the ads misleading. But Netto wasn't going to take that lying down and appealed to the big kahuna: the Federal Court of Justice, or BGH. In the same month, September 2024, the European Court of Justice also chimed in, saying that any price reduction advertised should be calculated using the lowest price of the past 30 days.
Fast forward to March 2025, and the BGH made its ruling. The case, fondly known as I ZR 222/19, was all about competition law and fair advertising, with a little nudge from the ECJ's interpretation of price advertising. The verdict? Discount ads need to be as clear as day and truthful to a fault, or they risk misinforming consumers about the reference price or the duration of the discount. This means that Netto's ads need to be damn sure that they're knocking off a genuine previous price and clearly communicating it, or they'll find themselves in deep water with consumers.
To put it simply, the BGH, following the ECJ’s lead, set some tough transparency and accuracy standards for Netto and other retailers. If they want to avoid confusing consumers with misleading ads, they better shape up or else the consumer protection laws will be knocking at their door! No updates or contradictory rulings have been reported since then, so it looks like the guidelines are officially sticking.
In the aftermath of the legal dispute, Netto had to negotiate with the finance department to cover potential penalties, given their questionable advertising practices. Subsequently, the business decided to overhaul its advertising strategy to ensure that the price mentioned in its ads is reduced honestly and clearly, following the guidelines set by the BGH and the European Court of Justice.
){kind=link}