AS TO THE ADMISSIBILITY OF
Application No. 16555/90
by R. GmbHgMBh
against the Federal Republic of Germany
The European Commission of Human Rights sitting in private
on 8 November 1990, the following members being present:
MM. C.A. NØRGAARD, President
J.A. FROWEIN
S. TRECHSEL
F. ERMACORA
G. SPERDUTI
E. BUSUTTIL
G. JÖRUNDSSON
A.S. GÖZÜBÜYÜK
A. WEITZEL
J.-C. SOYER
H.G. SCHERMERS
H. DANELIUS
Mrs. G. H. THUNE
Sir Basil HALL
MM. F. MARTINEZ RUIZ
C.L. ROZAKIS
Mrs. J. LIDDY
MM. L. LOUCAIDES
J.-C. GEUS
A.V. ALMEIDA RIBEIRO
M.P. PELLONPÄÄ
Mr. H.C. KRÜGER, Secretary to the Commission
Having regard to Article 25 of the Convention for the
Protection of Human Rights and Fundamental Freedoms;
Having regard to the application introduced on 2 February 1990
by R. GmbH against the Federal Republic of Germany and registered
on 2 May 1990 under file No. 16555/90;
Having regard to the report provided for in Rule 47 of the
Rules of Procedure of the Commission;
Having deliberated;
Decides as follows:
THE FACTS
The applicant is a pharmaceutical company producing medical
drugs with its seat in U. Its manager is Mr. Z. It is
represented by Mr. Rüdiger Zuck, a lawyer in Stuttgart.
The applicant company is specialised in producing so-called
"generica", i.e. substances which are no longer protected by patents
and are used to produce medicaments equivalent to those previously
introduced on the market by the inventing firms at a considerably
higher price. The applicant advertises its products as being
"bio-acquivalent" to the reference products. The competitors concerned
therefore brought civil actions against the applicant company.
On 11 March 1986 the applicant company was ordered by the
Cologne Regional Court (Landgericht) at the request of the Bayer AG to
abstain from advertising in publications adressed to the medical
profession its product "Nifedipin-ratiofarm 20" as being
"bio-acquivalent" with the plaintiff's product "Adalat". The latter
had been until 20 March 1985 the only product on the market containing
Nifedipin.
The judgment was confirmed by the Cologne Court of Appeal
(Oberlandesgericht) on 5 December 1986. Both courts considered that
the comparison in the applicant's advertisement with the reference
product and the alleged "bio-acquivalence" constituted unfair
competition in violation of Section 1 of the Unfair Competition Act
(UWG). Even though the plaintiff's product "Adalat" was not expressly
mentioned in the advertisement it was the leading product based on
Nifedipin and therefore it was obvious to the addressees that it was
meant to be the reference product.
In the courts' opinion there was no objective justification for
the comparison with a leading product (vergleichende Werbung). In its
publicity the plaintiff company had not in any way denigrated the
applicant's product necessitating a counter-publicity on its part.
Nor was it necessary to stress the "bio-acquivalence" in order to
underline, in the public interest, the economic advantage of the
applicant company's product. The applicant company did have other
more general possibilities to publicise the advantages of its products
than by referring to the product of a competitor and thereby profiting
from this product's market position. Like the plaintiff it could
publicise in a graphic manner the relevant data necessary to inform
the medical profession about the therapeutical value of its
medicament. There was no therapeutical necessity for medical doctors
to be informed about the two products' interchangeability. If
provided with the relevant data medical doctors could themselves find
out this information. The applicant already had an advantage
vis-à-vis the plaintiff as it did not have to invest any time and
money into research necessary to develop a new medicament. This
burden had been on the plaintiff and it was therefore unjustified that
the defendant profited from the plaintiff product's market position
once the patent protection expired. The right to freedom of
expression could not be invoked as the interdiction of the
advertisement was justified in the interest of the protection of the
prevailing rights of the plaintiff company.
An appeal on points of law (Revision) was rejected by the
Federal Court (Bundesgerichtshof) on 30 March 1989. In respect of the
applicant company's argument that the public had an interest in being
informed of the "bio-acquivalence" of its product and the considerable
price difference compared with the plaintiff's product the Federal
Court stated that mere economic interests did, contrary for example to
the interest in being informed about technical progress, personal
risks or deceitful trade practices, justify a direct comparison with a
competitor's product only where there was no other possibility of
informing the interested public about the economic advantage of the
advertised product. There were however, so the Federal Court noted
referring to the lower court's findings, sufficient other
possibilities for the applicant company without a comparison to the
detriment of a competitor. Insofar as there existed a public interest
in keeping public health care costs low, there was for example the
possibility of providing information to the medical profession via the
Federal Health Office (Bundesgesundheitsamt), to insurance companies
and other public institutions. Also the legislator could be requested
to intervene.
On 29 January 1986 the applicant company was likewise ordered
by the Hamburg Regional Court to abstain from advertising its products
by informing health insurance companies of the prices of its own
products in comparison with those of the plaintiff, a competitor. The
Court stated that it would be admissible to indicate all medicaments
of a given range and their prices in form of a general survey. However,
it constituted unfair competition to compare the applicant company's
products only with those of a single competitor.
This judgment was confirmed by the Hanseatic Court of
Appeal on 11 December 1986 and the Federal Court on 30 March 1989. The
latter court stated that the applicant company had other possibilities
to point out the price advantages of its products than to compare them
with those of a competitor who first introduced them on the market.
It could, for instance, have indicated prices or percentage relations
to prices of competing products without naming those products. This
would have been a practicable and acceptable way to serve the general
public by informing the health insurance institutions of the price
advantages offered by the applicant company.
The applicant company then lodged a constitutional complaint
against all aforementioned decisions. It was rejected by a group of
three judges of the Federal Constitutional Court (Bundesverfassungs-
gericht) on 14 August 1989 as offering no prospects of success. The
applicant company was ordered to pay a fee of 600 DM.
COMPLAINTS
The applicant company complains that the above judgments
interfere in an unjustified and disproportionate manner with its right
to inform the public, health care institutions and practitioners of
the possibility it offers with its cheap but bio-acquivalent products
to lower the enormous costs in the sector of health care. It
considers that insurance companies, pharmacies and medical doctors
need to receive extensive and complete information. Therefore it was
necessary for its advertisement to mention the reference product. In
order to compare products with the one offered by the applicant
company a doctor had to know which one was bio-acquivalent and which
product the least expensive. The applicant company therefore
considers that the judgments complained of violate Article 10 of the
Convention because they are disproportionate to the aim pursued.
THE LAW
The applicant company, who was forbidden by the competent
national courts to publish certain advertisements comparing its own
products and their prices with those of specific competitors,
complains of an interference with its right to impart information as
guaranteed under Article 10 (Art. 10) of the Convention.
Article 10 para. 1 (Art. 10-1) provides:
"Everyone has the right to freedom of expression. This
right shall include freedom to hold opinions and to receive
and impart information and ideas without interference by
public authority and regardless of frontiers. ..."
However, interferences with this right are compatible with
the Convention when they fulfil the requirements of paragraph 2 of
Article 10 (Art. 10-2) which provides:
"The exercise of these freedoms, since it carries with it
duties and responsibiities, may be subject to such
formalities, conditions, restrictions or penalties as are
prescribed by law and are necessary in a democratic society,
in the interests of national security, territorial integrity
or public safety, for the prevention of disorder or crime,
for the protection of health or morals, for the protection
of the reputation or rights of others, for preventing the
disclosure of information received in confidence, or for
maintaining the authority and impartiality of the judiciary."
The Commission first considers that Article 10 (Art. 10) is
applicable in the present case as the applicant company's
advertisements in question not only intended to promote its economic
interest but, being designed for health practitioners, it also
conveyed information of both a commercial and scientific nature (cf.
Eur. Court H.R., markt intern Verlag GmbH and Klaus Beermann judgment
of 20 November 1989, Series A no. 165, p. 17 paras. 25 - 26).
As to the requirements set out in paragraph 2 (Art. 10-2), the
applicant company does not dispute that the interference complained of
is based on domestic law and serves the purpose of protecting the
rights of others. The Commission notes in this context that the aim
of the Unfair Competition Act is the protection of the rights of
business firms against unfair practices by competitors and also the
protection of the rights of consumers. This is in fact a legitimate
aim under Article 10 para. 2 (Art. 10-2), for the protection of the
rights of others in a democratic society (No. 7805/77, Dec. 5.5.79,
D.R. 16 p. 68 [73]).
The applicant company only disputes the necessity and
proportionality of the measures in question and invokes the general
interest in informing the public about the economic advantages of its
products at a time where the cost explosion in the public health care
sector required drastic measures to reduce expenditures.
According to the case-law of the European Court of Human
Rights the Contracting States have a certain margin of appreciation in
assessing the existence and extent of the necessity of an
interference. Such a margin is, according to the Court, essential in
commercial matters and in particular in the area of unfair
competition. The Commission has similarly stated in its decision
cited above (No. 7805/77) that the level of protection in regard to
commercial "speech" is lower than that accorded to the expression
of "political" ideas, in the broadest sense, with which the values
underlying the concept of freedom of expression are chiefly concerned.
The supervision by the Convention organs in this respect is therefore
limited to the question whether the measures taken on the national
level are justifiable in principle and proportionate (markt intern
judgment, loc. cit. at p. 20 para. 33). In order to establish whether
the interference complained of was proportionate it is necessary to
weigh the requirements of the protection of the rights of other
companies against the publication of the information in question. The
Commission must look at the impugned court decisions in the light of
the case as a whole (markt intern judgment, loc. cit., para. 34).
In the present case the national courts did weigh the competing
interests at stake. They underlined that the public had, for example,
an interest in being informed about technical progress, personal risks
or deceitful trade practices. A direct comparison with a competitor's
product is, under German law, permitted only where there is no other
possibility of informing the interested public about the economic
advantage of the advertised product. However, according to the
judgments complained of, the applicant company had other possibilities
of praising the economic advantages of its products than to compare
them directly with those of a particular competitor. The applicant
company has not shown that this reasoning is unrealistic in practice
or for any other reason untenable and arbitrary. In these
circumstances it cannot be found that the decisions of the civil
courts in the present case, confirmed from the constitutional point of
view by the Federal Constitutional Court, went beyond the margin of
appreciation left to the national authorities.
The Commission therefore concludes that there is no appearance
of a violation of Article 10 (Art. 10) and the application is manifestly
ill-founded within the meaning of Article 27 para. 2 (Art. 27-2) of the
Convention.
For these reasons, the Commission, by a majority,
DECLARES THE APPLICATION INADMISSIBLE.
Secretary to the Commission President of the Commission
(H. C. KRÜGER) (C. A. NØRGAARD)
Full & Egal Universal Law Academy