Abstract
Under the European Union Unfair Commercial Practices Directive, a commercial practice is misleading if it “is likely to deceive the average consumer or is likely to cause him to take a transactional decision that he would not have taken otherwise.” Advertising statements constitute a major example of commercial practices. In this contribution, we analyse the issue as to how the misleading character of advertising statements should be assessed. We use the example of risky mortgage loan contrast to demonstrate how courts and consumers assess pre-contract statements.
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Notes
- 1.
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/EC of the European Parliament and of the Council and Regulation (EC) No 2006/2004 of the European Parliament and of the Council (‘Unfair Commercial Practices Directive’), OJ L 149, pp. 22–39.
- 2.
Rzeczpospolita from 26 January 2015, http://www.ekonomia.rp.pl/artykul/710047,1174464-Kim-jestes-frankowcu-.html?referer=redpol; Rzeczpospolita from 5 February 2015, http://www.ekonomia.rp.pl/artykul/710047,1177051-Gdzie-mieszkaja-frankowicze.html?referer=redpol; The Economist from 15 November 2014, Forint exchange, http://www.economist.com/news/finance-and-economics/21632651-hungarys-government-gives-struggling-borrowers-break-forint-exchange (accessed on 13 September 2018).
- 3.
See the official position of the Austrian Financial Market Supervision Authority (Österreichische Finanzmarktaufsicht, FMA) on foreign currency loans: Position der Finanzmarktaufischt zu Fremdwährungskrediten und Informationen zur derzeitigen Lage, https://www.fma.gv.at/de/sonderthemen/fremdwaehrungskredite.html (accessed on 13 September 2018).
- 4.
- 5.
The Economist from 15 November 2014, Forint exchange, http://www.economist.com/news/finance-and-economics/21632651-hungarys-government-gives-struggling-borrowers-break-forint-exchange.
- 6.
Rzeczpospolita from 2 March 2015, http://www.ekonomia.rp.pl/artykul/1183012.html.
- 7.
Rzeczpospolita from 2 March 2015, http://www.ekonomia.rp.pl/artykul/1183012.html.
- 8.
The development of exchange rate of franc versus PLN is accessible at the website of the Polish central bank (Narodowy Bank Polski), http://www.nbp.pl/homen.aspx?f=/kursy/kursyen.html.
- 9.
Rzeczpospolita from 2 February 2015, reports on struggles of borrowers http://www.ekonomia.rp.pl/artykul/710047,1176120-Oferta-sprzedazy-mieszkan-zadluzonych-we-frankach.html?referer=redpol.
- 10.
The Economist from 15 November 2014, Forint exchange, http://www.economist.com/news/finance-and-economics/21632651-hungarys-government-gives-struggling-borrowers-break-forint-exchange.
- 11.
Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts, OJ L 95, 21.4.1993, pp. 29–34.
- 12.
See Kásler, para. 24–25.
- 13.
- 14.
For the use of the term ‘adjudication’, we draw on Fuller (1978).
- 15.
Joined Cases C-482/13, C-484/13, C-485/13 and C-487/13, Unicaja Banco, SA v. José Hidalgo Rueda and other.
- 16.
Directive 2014/17/EU of the European Parliament and of the Council of 4 February 2014 on credit agreements for consumers relating to residential immovable property and amending Directives 2008/48/EC and 2013/36/EU and Regulation (EU) No 1093/2010, OJ L 60, 28.2.2014, pp. 34–85.
- 17.
Leading case on the average consumer notion include judgments C-210/96, Gut Springheide, Rudolf Tusky [1998] ECR I-04657; C-220/98 Estée Lauder v Lancaster [2000] ECR I-00117; C-99/01 Linhart & Biffl v Unabhaengiger Verwaltungssenat [2002] ECR I-09375. For a comprehensive overview see Keirsbilck (2011), pp. 47–54.
- 18.
Albors-Llorens and Jones (2016), p. 71.
- 19.
Reich (2016), p. 148.
- 20.
Sibony (2014), p. 909.
- 21.
Reich (2016), p. 151.
- 22.
- 23.
We refer here to Tereszkiewicz (2015).
- 24.
De Vries (2016), p. 411.
- 25.
Kahneman and Tversky (1979).
- 26.
Vermeule (2006).
- 27.
Kahneman and Tversky (1979).
- 28.
Posner (2007), p. 19.
- 29.
Bennett and Broe (2010).
- 30.
Damasio and Sutherland (1994).
- 31.
Kahneman (2011).
- 32.
- 33.
- 34.
Fischhoff (1982), p. 341.
- 35.
- 36.
- 37.
Cf e.g. Golecki (2015).
- 38.
The operative part of uniformity decision no. 2/2014 of the Curia of Hungary (Standardization Panel) available at: http://www.lb.hu/en/uniformity-decisions, downloaded on 30.06.2018.
- 39.
Heuristics of availability and representativeness are of similar nature, since both enable agent to overcome the deficit of information and to act even under ignorance. Cf. Kahneman (2011), pp. 129, 151.
- 40.
Rachlinski (1998).
- 41.
C-110/14 03.09.2015.
- 42.
C-26/13, EU:C:2014:282.
- 43.
C-482/13, C-484/13, C-485/13 and C-487/13, EU:C:2015:21.
- 44.
C-154/15, C-307/15 and C-308/15, EU:C:2016:980.
- 45.
Case C-118/17.
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Acknowledgment
The paper has been prepared within the framework of the research project 2015/17/HS5/00495 financed by the National Science Centre, Poland.
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Golecki, M.J., Tereszkiewicz, P. (2019). Taking the Prohibition of Unfair Commercial Practices Seriously. In: Mathis, K., Tor, A. (eds) New Developments in Competition Law and Economics. Economic Analysis of Law in European Legal Scholarship, vol 7. Springer, Cham. https://doi.org/10.1007/978-3-030-11611-8_5
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