Within the case-law of the Commission for Protection of Competition (“CPC”) and the Supreme Administrative Court (“SAC”), imitation is defined as a separate breach of competition regulation, which aims to mislead consumers with regards to essential qualities of a particular product. By means of unfair behaviour, a company may aim to exploit the image of a competitor and to reap the benefits from another market participant’s good reputation. Such act of unfair competition is characterized by the following basic features:
According to the CPC and the SAC, imitation is any deliberate misconduct of activities, intending to resemble a name, text, vision or functionality and other qualities that determine the distinctiveness and originality of products or services, for the purposes of misleading of consumers about the origin and quality of products.
- Imitation with No Damages Caused is also Unfair Competition
By its very nature, imitation constitutes a formal violation, i.e. it is still regarded as breach of competition protection legislation if no damages have been caused or suffered by other competitors.
- Possible Misleading of Consumers
Although this is the most controversial feature of imitation, the CPC and the SAC agree on some of the guidelines that the competent authorities should follow when assessing the possibility of consumers’ misleading. It is a constant court practice that discretion should be based on the perception of the average intelligent and informed modern consumer.
The assessment should be carried out at the respective referent moment.
The discretion for the presence of imitation is predominantly from consumers’ point of view, since their behaviour affects the interests of market players. It is the presence of proximity in characteristic and memorable elements constantly associated by consumers that indicate imitation. Thus, it is consistently stated that no special knowledge is needed to assess the similarity between the products of two competitors. Whether the appearance of the packaging and its elements – shape, colour, image, inscription, font, logo, etc. may cause misleading depends on the perception of the average consumer.
In assessing whether there is imitation is made the overall visual effect by which the product is perceived by an average consumer should be considered. The CPC advocates that imitation occurs when the appearance of a product is reproduced in a manner that resembles another, well-known product or a product which is associated in the consumers’ mind. Such attitude will possibly cause or it is very likely to cause confusion among consumers.
It is concluded that minor and insignificant differences in the appearance of the imitation item does not in itself exclude liability under the Competition Protection Act if all the visual elements as overall visual effect are similar to another market player’s products. A general appearance as such creates an objective likelihood of consumers’ misleading with respect to the product or the seller.
In this sense, regarding the imitation of companies and trademarks, the European jurisdictions assess the likelihood of consumers’ confusion according to the overall impression created by the dominant element of the trademark, rather than the separated impact of any single element.
- Recognised reputation
According to the Supreme Court imitation always aims at misleading consumers about a particular product. For this reason, a prerequisite for the imitation of goods and products is the public reputation recognition of the goods imitated. In such cases the unfair competitor benefits from its misconduct. The presence of recognised reputation on the respective market is relevant for the harm on the interests of other competitors.
The presence of the constitutive elements listed is assessed by the judicial authorities on a case-by-case basis. However, the CPC tends to resolve superfluous, providing blank arguments by reference to lasting practice, without taking into account the specifics of the particular dispute. In addition to the possible judicial review at second instance, the prospects for protection under the Consumer Protection Act, the Trademarks and Geographical Indications Act and the Commerce Act should also be taken into account. Although these acts have different material scope, in some cases these forms of protection do have crossing points. Precisely, these forms of protection are not mutually exclusive. Thus, the alleged infringer may be subject to several sanctions in different proceedings at the same time.