Unfair competition

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In terms of intellectual property, unfair competition mainly consists in creating a risk of confusion with a product, a brand or any other distinctive sign of a competitor. The principle of free competition has been recognized in France since 1791 and the famous Le Chapelier law. However, this freedom must necessarily be tempered by ethical principles so that free competition is not distorted.

What is parasitism?

Parasitic competition consists of placing yourself in the wake of your competitor. It is formed when a company attempts to divert the notoriety or the efforts and investments of its competitor to its advantage, without untying the purse. Such behavior may result in practice, for example, by the use of packaging that is identical or very similar to the packaging used by a leading competitor on the market.

What is parasitism?

Parasitic competition consists of placing yourself in the wake of your competitor. It is formed when a company attempts to divert the notoriety or the efforts and investments of its competitor to its advantage, without untying the purse. Such behavior may result in practice, for example, by the use of packaging that is identical or very similar to the packaging used by a leading competitor on the market.

Qualifying conditions

Acts contrary to normal commercial practices may be sanctioned as unfair competition on the basis of civil liability (Article 1382 and 1383 of the Civil Code). This action is therefore conditioned by the existence of the 3 elements necessary for the involvement of civil liability:

A fault

Fault is often an intentional act aimed at harming a competing company. Intentionality is not an obligation. An unintentional act may constitute an act of unfair competition.

a prejudice

Fault not causing harm cannot be considered unfair competition. The damage caused to the competitor must be certain (not just presumed or alleged) and only the company targeted by the unfair competition can rely on this damage.

A causal link

There must be a causal link between the fault committed and the damage suffered. The fault must be the cause of the damage suffered: if no causal link can be established, unfair competition will not be established.

Unfair competition action

An action for unfair and parasitic competition may be joined to an action for infringement, however these two actions must remain independent.

The two actions have different objectives. The action for infringement is intended to defend intellectual property rights, while the action for unfair and parasitic competition is intended to repair the damage resulting from breaches of commercial loyalty. It is therefore necessary to be able to invoke facts of unfair competition distinct from acts of infringement to obtain compensation for the alleged damages.

The action for unfair and parasitic competition may be preferred to the action for infringement when the infringement is not certain. In this case, a civil liability action allows greater latitude in the action but poses a greater difficulty of proof.

It is a question of not standardizing situations but of considering each specific case in its entirety.

 

Unfair competition action

An action for unfair and parasitic competition may be joined to an action for infringement, however these two actions must remain independent.

The two actions have different objectives. The action for infringement is intended to defend intellectual property rights, while the action for unfair and parasitic competition is intended to repair the damage resulting from breaches of commercial loyalty. It is therefore necessary to be able to invoke facts of unfair competition distinct from acts of infringement to obtain compensation for the alleged damages.

The action for unfair and parasitic competition may be preferred to the action for infringement when the infringement is not certain. In this case, a civil liability action allows greater latitude in the action but poses a greater difficulty of proof.

It is a question of not standardizing situations but of considering each specific case in its entirety.

 

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