The insurance policy comparison service does not do comparative advertising
The company that provides consumers with the comparison is not classifiable as a competitor because it does not directly offer the services it compares
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Key points
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The online comparison of products or services such as insurance does not fall within the scope of comparative advertising. This is because the company that provides the comparison service to consumers cannot be classified as a competitor to insurance companies because it does not directly offer the services it compares and thus operates on a separate product or service market.
This was established by the Court of Justice of the European Union in a ruling filed on 8 May in the Case C-697/23 (Huk-Coburg) in which Luxembourg clarified the notion of competing undertaking central to the application of Directive 2016/114 concerning misleading and comparative advertising, which aims to protect traders from misleading advertising and its unfair consequences and to establish the conditions for the lawfulness of comparative advertising, which is that type of advertising that "explicitly or implicitly identifies a competitor or goods or services offered by a competitor".
The affair
.The case centred on a parent company of a large German insurance group, which is also active in the field of car insurance, and a group of companies operating an internet site of online comparators that offers a free service for comparing different products, in some cases even allowing the conclusion of contracts with suppliers of goods. The insurance company argued that the scores given to services and products, based on different parameters, were contrary to the German law on the prohibition of unfair competition because they were subject to comparative advertising. The Munich District Court, before deciding, raised a preliminary question of interpretation to the European judges.
The orientation of the EU Court
.The starting point for the EU Court is the correct classification of the company offering online comparison services for insurance products in order to clarify whether it can be qualified as a competitor to the insurance company.
In order to be able to challenge a practice as comparative advertising falling in the field of competition and apply the directive, it is indispensable that the issue concerns the activities of competing companies. It is true that the directive does not contain a definition of the notion of 'competing' undertaking, but thanks to the interventions of the Court itself, it has been clarified that competing undertakings are those in which there is a substitutability of goods or services offered by undertakings on the market. Therefore, in order to ascertain the existence of a competitive relationship between the company operating an online price comparison and the insurance company, it is necessary to ascertain whether there is a 'substitutability of the services offered respectively by the parties to the market procedure'.
