Spain amends the Unfair Competition Law
Published on 23rd Jun 2022
The reform introduces new examples of misleading and aggressive practices affecting, among others, the food and entertainment sectors, influencers, and online advertising.
This amendment to Law 3/1991, of 10 January, on Unfair Competition has been implemented through Royal Decree-Law 24/2021, of 2 November, and came into effect on 28 May 2022, and introduces the following:
Modification of acts of deception (art. 5 UCL)
A third paragraph has been added to article 5 of the Unfair Competition Law ("UCL"), under which the sale of goods seemingly identical to goods sold in other Member States is considered unfair when those goods have significantly different compositions or characteristics, unless it is justified by legitimate and objective factors.
The legislator has sought to tackle the dual-quality problem of food items that various institutions have been criticizing for years. For example, the European Commission has published several studies highlighting the disparities in the quality of the composition of the same food items based on the place or country where they are sold (for example, different sweetener content, fat content, etc.).
Changes in the regulation of disguised commercial practices (art. 26 UCL)
The wording of article 26 UCL is extended to include deceptive advertising carried out on social networks, information society services, and online searches.
The most affected activities will be those carried out by influencers, who have often been linked to covert advertising practices. It is not always easy to determine whether the content published by influencers is merely personal opinions or if it is part of an advertising campaign organised by third parties. To this end, the new wording of the UCL requires that any advertising action is specified in the published content – or through images and sounds that are identifiable to the consumer.
The new provision also includes a search functionality obligation for providers. In particular, when traders have paid these providers (for example, Google, Bing, etc.), directly or indirectly, to obtain a better ranking on online search results, the providers of such online services must inform consumers comprehensibly and accurately.
Introduction of new misleading practices (art. 27 UCL)
The change in article 27 of the UCL includes three new cases of misleading practices.
Practices consisting in reselling event tickets to consumers or users are considered unfair because they are misleading since the trader acquired them using automated means (for example, bots, software, etc.) to circumvent any limit imposed on the number of tickets that each person may buy, or any other regulation applicable to the purchase of tickets. This provision conflicts with a practice that has been common in the recent past, as proved by several reports, whereby for certain popular events, many tickets were bought directly by bots to resell them at a higher price.
On the other hand, the aim is to ensure that reviews published by other consumers on specific products or services are genuine; therefore, the new article 27 of the UCL requires businesses to implement measures to verify that these reviews have been written by the consumers and users who have added them. Such checks are, in fact, already carried out by several market operators.
Modification concerning aggressive practices (art. 31 UCL)
Finally, the legislator also wished to introduce a fourth paragraph in article 31 of the UCL, whereby the following are now considered unfair and aggressive: unsolicited visits made by a trader to the home of a consumer and user; and trips organised by a trader with the aim or result of promoting or selling goods or services, if they do not respect the terms of the restrictions under article 19.7 of the General Law for the Defence of Consumers and Users.
Osborne Clarke commentary
The modification of the UCL, which the transposition of Directive (EU) 2019/2161 requires, pays special attention to new technologies and the use of digital tools, in what represents a noteworthy modernisation of our commercial regulations.
Particular cases – which are of growing importance- such as advertising on social networks, the resale of tickets through bots, or online reviews of products and services, among others, will have a specific regime of protection.
