The answer has never been clear-cut. In theory, comparative advertising has always been lawful in the UK. In practice, advertisers were always nervous about it.
This was partly because of the obscure provisions of the 1938 Trade Marks Act, which had the effect of preventing references to competitors’ trademarks. And even though a replacement 1994 act made the waters less muddy, comparative advertising remained a legal minefield into which companies feared to venture.
What’s more, they worried about sparking tit-for-tat ad wars that might turn off consumers.
However, a 2008 legal ruling was to prove a landmark in helping establish how far advertisers could go in knocking the opposition.
The wrangle began four years earlier when O2 sued Hutchinson UK, the owner of Three, over alleged trademark infringement in a TV ad comparing Three’s prices with those of O2. Although O2 did not claim the price comparisons were misleading, it went to court because the spot featured animated bubbles similar to the bubble trademarks registered by O2.
After its claim was rejected by the High Court, O2 took it to the Court of Appeal, which, because of the important issues raised about comparative advertising, referred the case to the European Court of Justice. In June 2008, the ECJ ruled that Hutchinson’s use of O2’s logo did not violate EU regulations on comparative advertising.
These rules allow such ads as long as they are not misleading, do not create consumer confusion and do not denigrate a trademark. Hutchinson claimed the ruling "clears the way for us to put our deals up against the best our competitors offer and let the consumer decide".
Things you need to know
- The UK rules on comparative advertising were harmonised in 2000. They are – for the time being at least – regulated by a series of European Union directives.
- Attitudes to comparative advertising vary significantly between countries. UK courts have been relaxed about it while Germany long regarded it as unfair competition.
- Studies in the US have shown that while numbers of comparative ads have increased since 1960, the amount of comparative advertising is still small.