Where does fair competition end and unfair play begin?
When promoting their goods or services, companies do not always realise that their marketing strategies may violate the rules of fair competition.
Let’s take a closer look.
What is Unfair Competition and What Forms Does It Take?
Unfair competition refers to actions by a company aimed at gaining an advantage in business by means that hinder fair competition. Such actions may harm the business reputation of, or cause losses to, other market participants.
Let us review the main types of violations with up-to-date examples from the practice of the Ministry of Antimonopoly Regulation and Trade (MART).
Discrediting Competitors
Essence: Dissemination of false, inaccurate, or distorted information about a competitor or its goods, works, or services.
Case example: Company K distributed information claiming that its competitors provided services of inadequate quality. The aim of Company K’s actions was to lure clients away.
Decision: MART recognised this as discrediting. The unfair competition brought Company K not profit, but losses and legal proceedings.
Takeaway: Emphasise your own strengths, not others’ “weaknesses”.
Incorrect Comparison
Essence: Comparing with competitors in a way that misleads consumers or cannot be objectively verified.
Case example: Company A engaged in online retail. Its advertising slogan read: “Cheaper than in Store B.” In reality, only a limited range of promotional goods was priced lower.
Decision: MART found that the slogan constituted a comparison with a competitor and its products, containing inaccurate and distorted wording designed to create a false sense of superiority. Such a comparison was deemed unfair competition. The use of the slogan resulted in administrative liability.
Takeaway: If you compare yourself with competitors – do so honestly and on the basis of verifiable data. Exaggerated claims may cost more than a good advertisement.
Misleading Consumers
Essence: Providing consumers with false information about a product, company, its origin, or status, in order to create a false impression.
Case example: Company C, engaged in the sale of household goods:
- stated on its website that it was the only official partner of the well-known German chain “K” in Belarus;
- altered the country of origin indicated on the product labelling.
Decision: MART found that the information published by Company C was inaccurate and misleading to consumers, and established the fact of unfair competition.
What Are the Risks of “Unfair Play”?
Violation of fair competition rules entails administrative liability in the form of a turnover-based fine, but not less than 400 basic units (BUs).
We have reviewed only a small portion of the examples. With the rapid development of e-commerce and advertising, such cases are becoming significantly more frequent.
Don’t Risk Your Reputation!
If you have doubts about the legality of your marketing actions, or suspect unfair conduct by competitors, do not take risks.
REVERA’s lawyers are ready to conduct an audit of your advertising campaign or protect you from unfair practices by competitors. We will help you find a safe and lawful solution for your business.
Authors: Iryna Andryieuskaya, Dziyana Snesarskaya.
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