Caught on our radar
Is the greatest
and the best
Marketing is extremely important for all companies. But can a restaurant owner really claim to offer “the best food in town", and can a bank say that it provides “the best customer service"? In a recent court ruling, telecommunications company Telia was forbidden from using the terms “best coverage" and “fast internet".
Not only should advertising be legal and honest, it should also be credible. This means that the facts behind a particular claim about a company or a product/service offered must be able to back up the claim. Advertising may not be designed in an objectionable manner or be misleading.
Ruling against Telia
On 16 June 2009, the Swedish Market Court ruled on the dispute between competitors Hi3G and Telia Sonera in relation to Telia’s marketing for its mobile broadband service, which claimed to offer “the best coverage" and “fast internet". The court found that Telia could not back up its claim that its mobile broadband service offered “the best coverage" or "fast internet", either through its coverage maps or in any other way. Its advertising was therefore deemed to be misleading in accordance with the Swedish Marketing Act. The court also ruled that the “best coverage" claim was too general a statement, and that it was lacking in clear content. Telia has therefore been banned from using the statements in its marketing under penalty of a SEK 750,000 fine.
The Swedish Marketing Act establishes the principle that claims and other statements must not be misleading. Statements include words, images, symbols and figures. This may relate to statements in adverts and brochures, and on packaging, as well as oral statements.
In order to ascertain whether or not a particular example of marketing is misleading, the marketing must be viewed as a whole. Within the scope of this assessment, the information must be of considerable significance to the consumer, and it must be likely to have an impact on the consumer’s ability to make a well-founded decision. The legal wording gives examples of respects in which statements may not be misleading. This relates to matters such as the product’s nature, quantity, price, quality and origin, the company’s qualifications, brands and rights, and the consumer’s rights in view of the purchase.
Nor may significant information be omitted, thereby making the statement misleading. Information that is unclear, incomprehensible or ambiguous is viewed on a par with omitted information.
Companies should be aware that the burden of proof in the event of any dispute is reversed, meaning that the company must be able to substantiate direct and indirect factual statements used in their marketing.