Unfair competition
Areas of expertise > Unfair Competition
In intellectual property matters, unfair competition consists mainly in creating a risk of confusion with a product, a trademark 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 is free riding?
Parasitic competition consists of following in the footsteps of a competitor. It is constituted when a company tries to divert to its profit the notoriety or the efforts and investments of its competitor, without untying its purse. Such behavior may be reflected in practice, for example, by the use of packaging that is identical or very similar to the packaging used by a leading competitor.
Qualification requirements
Acts contrary to normal commercial practice may be punished as unfair competition on the basis of civil liability (Articles 1382 and 1383 of the Civil Code). This action is therefore conditioned by the existence of the 3 elements necessary for the implementation of civil liability:
A fault
Misconduct is often an intentional act intended to harm a competing business. Intentionality is not a requirement. An unintentional act may constitute an act of unfair competition.
A prejudice
La faute ne causant pas de préjudice ne peut pas être considérée comme de la concurrence déloyale. Le préjudice causé au concurrent doit être certain (pas seulement présumé ou prétendu) et seule l’entreprise visée par la concurrence déloyale peut se prévaloir de ce préjudice.
A causal link
There must be a causal link between the fault committed and the harm suffered. The fault must be at the origin of the damage suffered: if no causal link can be established, unfair competition will not be characterized.
The action for unfair competition
A claim for unfair and parasitic competition may be joined to a claim for infringement, but the two claims must remain separate.
The two actions have different objectives. The purpose of the infringement action is to defend intellectual property rights, while the purpose of the action for unfair and parasitic competition is to repair the damage caused by breaches of commercial fairness. It is therefore necessary to be able to invoke acts of unfair competition separate from acts of infringement in order to obtain compensation for the alleged damage.
Action for unfair and parasitic competition may be preferred to action for infringement when the infringement is not certain. In this case, action for civil liability allows greater latitude in the action but poses greater difficulty in proving the case.
The aim is not to standardize situations but to consider each case in its entirety.
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