Editorial guidelines

1. Claims under unfair competition law against action by the public sector can only be considered if it clearly leaves its area of responsibility and intervenes in competition without a legal basis.
   1. In the case of commercial activities of the public sector, these are also to be regarded as commercial activities within the meaning of the UWG if public purposes are also pursued.
   2. In the case of sovereign action by the public sector on the basis of statutory authorization, its activities are not subject to review under competition law.
   3. In the case of sovereign action by the public sector without legal authorization, the existence of a commercial act within the meaning of the UWG must be specifically determined on the basis of a comprehensive assessment of the relevant circumstances of the individual case, taking into account the concrete effects of the action of the public sector in competition.
2. An act of the public sector does not become contestable under competition law merely because it violates a rule of market conduct within the meaning of Section 3a UWG.

File number: 29 U 769/20
Announced on: 07.05.2020

Munich Higher Regional Court
In the name of the people
Judgment

In the legal dispute
[…]
, the 29th Civil Senate of the Higher Regional Court of Munich, presided over by Judge at the Higher Regional Court … as well as Judge at the Higher Regional Court … and Judge at the Higher Regional Court … on the basis of the oral hearing on 07.05.2020

found to be right:

I. On the defendant’s appeal, the judgment of the Landshut Regional Court of 27.11.2019, file no. 1 HK O 3323/19, as amended by order of the Landshut Regional Court of 12.12.2019, is amended and its paragraphs 1 and 2 are worded as follows:
1. The application for an interim injunction is dismissed.
2. The applicant shall bear the costs of the proceedings.

II. The applicant shall bear the costs of the appeal proceedings.

Reasons:

I. An offense is deemed to exist pursuant to § 540 para. 2, § 313a para. 1 sentence 1 ZPO.

II. The admissible appeal is well-founded.

Contrary to the opinion of the defendant, abusive conduct within the meaning of Section 8 para. 4 UWG cannot be established. It is not apparent that extraneous motives on the part of the applicant are in the foreground in the present case. The applicant feels affected by the statements and considers them to be anti-competitive and therefore naturally has the right to have his opinion reviewed by a court.

However, since the applicant is not entitled to the injunctive relief granted by the Regional Court, the Regional Court’s judgment was to be amended on the defendant’s appeal and the application for an interim injunction was to be dismissed (in its entirety). Contrary to the opinion of the Regional Court, the conduct challenged by the appeal does not constitute a commercial act within the meaning of § 8 para. 1 S. 1, § 3, § 2 Abs. 1 No. 1 UWG.

1. acc. § Section 2 para. 1 No. 1 UWG, a commercial act within the meaning of the law is any conduct by a person for the benefit of his own or another person’s business which is objectively connected with the promotion of the sale or purchase of goods or services or with the conclusion or performance of a contract for goods or services.

2. for the question of whether the public sector is carrying out a commercial activity, a distinction must first be made between purely commercial activities on the one hand and sovereign activities on the other. The commercial activity of the public sector is also to be regarded as a commercial act if public purposes are also pursued. In contrast, a distinction must be made as to whether the public sector is acting in a sovereign capacity on the basis of statutory authorization. If this is the case, its activities are not subject to review under competition law (cf. BGH, GRUR 2018, 196 para. 22, 23 – Eigenbetrieb Friedhöfe).

If, on the other hand, the public authority acts to fulfil a public task but does so without express authorization, a commercial act is not excluded (BGH, GRUR 2018, 196 para. 23 – Eigenbetrieb Friedhöfe; see also the press release of the BGH no. 28/2020 on its as yet unpublished judgment of 12.03.2020, I ZR 126/18 – Warnwetter-App on the case of exceeding the limits of an authorization basis; a.A. probably Franzke, in: Büscher, UWG, § 2 para. 1 no. 1 para. 71). However, it is also not to be assumed without further ado, but is to be specifically determined on the basis of a comprehensive assessment of the relevant circumstances of the individual case, taking into account the concrete effects of the actions of the public authorities in competition (BGH, GRUR 2018, 196 para. 23 – Own operation of cemeteries).

3) Measured against these standards, it cannot be assumed that the defendant is acting in the course of trade within the meaning of Section 2 para. 1 No. 1 UWG cannot be assumed. The consumer information in dispute is already to be regarded as covered by a statutory authorization basis, but in any case it is not a measure that would serve to promote the sale of a competing product of the defendant.

a) Contrary to the opinion of the applicant, the distinction to be made according to the case law of the Federal Court of Justice between sovereign action on the one hand and purely commercial action on the other also “fits” the action to be assessed here. Insofar as the applicant denies this with the argument that the defendant’s activity cannot be clearly assigned to any of these categories, it should be noted that the fine-grained distinction of the BGH is intended precisely for such cases. This is because the examination of whether an act is to be assessed under unfair competition law is not limited to the person of the acting party, but is based on the quality of the specific act – in this case, the challenged statements.

b) A purely commercial activity is not the subject of the present injunction proceedings. The defendant is indisputably entrusted with the task of supplying the inhabitants of the respective municipalities with drinking water as a special-purpose association for water supply and thus as a public corporation. The statements challenged here by the applicant are made in this context, so that a purely commercial activity cannot be assumed.

c) Contrary to the opinion of the applicant, the defendant’s activity is also not to be equated with a purely commercial activity, but is to be classified as sovereign action.

aa) It is not true that water supply is not a public activity – as the applicant would like to infer from the fact that this can also be transferred to private third parties. The supply of drinking water is a statutory task of the municipalities (and consequently also of the special-purpose association claimed here) via Art. 11 para. 2, Art. 83 para. 1 BV in conjunction with Art. 57 para. 2 sentence 1 GO. They not only have the right, but also the duty to establish and maintain the facilities required for the supply of drinking water for reasons of public welfare.

The fact that the water supply can also be transferred to private third parties does not change the fact that the municipality is entitled and, in particular, obliged under public law to provide a water supply that meets the legal requirements as a public service. The fact that precisely this type of basic supply should no longer be sovereign is not convincing.

bb) The statements to be assessed here about the quality of the drinking water provided by the defendant fall within this area of responsibility. The defendant therefore acted in any case within the framework of the fulfillment of a sovereign task incumbent upon it. The fact that the drinking water supply is provided for a fee does not change this, especially since many public services are only and exclusively provided for a fee.

d) The challenged statements are also covered by a statutory authorization basis and for this reason alone are not subject to assessment under unfair competition law.

aa) According to the case law of the Federal Court of Justice, the decisive question in the dispute is whether the public authorities have acted on the basis of statutory authorization and whether their activities are thus exempt from review under competition law or whether the public authorities have acted to perform a public task but without express statutory authorization and thus whether a commercial act can be established in the context of a comprehensive assessment of the relevant circumstances of the individual case, the provisions on which the disputed act is based are decisive (BGH, GRUR 2018, 196 para. 27 – Own operation of cemeteries).

bb) As described above, the defendant’s obligation to supply drinking water arises from Art. 57 para. 2 GO. This is therefore not only a duty incumbent on the municipalities pursuant to Art. Art. 11 para. 2 S. 2, Art. 83 Abs. 1 BV, but a statutory obligation for the provision of services of general interest, whereby drinking water refers to water that is at least also intended to be drunk by humans (see H.A. Wolff, in BeckOK KommunalR Bayern, 5th ed. 01.03.2020, Art. 57 GO para. 61; Wolff, in: Lindner/Mö-stl/Wolff, BV, 2nd ed., Art. 83 para. 20, 22).

cc) The quality of the drinking water must comply with the Drinking Water Ordinance (H.A. Wolff, in BeckOK KommunalR Bayern, 5th ed. 01.03.2020, Art. 57 GO para. 60). Section 21 TrinkwV also imposes an obligation on the owner of water supply systems to inform consumers about the quality of the drinking water.

dd) In view of this, the challenged statements are to be classified as information for consumers about the quality of the drinking water to be provided by the defendant in its sphere of influence, which is covered by the defendant’s duties of general interest. It is irrelevant whether the content of the statements meets the requirements of § 21 TrinkwV or falls short of these in terms of the information content; similarly, in the case in dispute there is no need to decide whether the content of the information is correct. This is because the law on unfair competition only applies if the public authorities clearly leave their area of responsibility and intervene in competition without a legal basis (Köhler, in: Köhler/Bornkamm/Feddersen, UWG, 38th edition, § 3a para. 2.21). This cannot be assumed in the present case, so that the asserted claims can be ruled out from the outset.

e) However, even if one wanted to argue that in the absence of an explicit basis of authorization claimed by the defendant for his specific action, the assumption of a commercial act could be considered in principle , such an assumption must be denied in the present case. The challenged statements do not constitute a sales-promoting, competition-related measure, since the defendant’s aim with these statements is clearly not to increase sales of “its” drinking water, i.e. to encourage consumers in its supply area to “buy” more water, but merely to inform the inhabitants living in its area, any people wishing to move to the area or potential tourists in simple language about important local conditions – namely the water quality. The fact that this may lead to consumers living in the catchment area drinking more tap water instead of mineral water in the future is irrelevant for the classification as a non-commercial act, because such a competitive effect occurs at best as a reflex and is also obviously secondary to the actual motives of the defendant (see Altmann, in: Gloy/Loschelder/Danckwerts, Wettbewerbsrecht, 5th ed., § 66 para. 14). The fact that the headline of the corresponding information page is “Drinking water and mineral water in comparison” does not change this; the actual motives of informing consumers about the activities of the special-purpose association in the area of services of general interest entrusted to it are still evident.

f) The arguments put forward by the applicant – who incidentally refers to Section 21 TrinkwV on p. 11 of his written submission dated 4 May 2020 (p. 63 of the annex) itself as the basis for authorization – are not convincing. In particular, the applicant cannot rely on the fact that the statements violate the HCV and could therefore not be covered by Section 21 TrinkwV.

aa) As described above, the law on fair trading only comes into play in the case of conduct based on an authorization. only comes into consideration if the public authority clearly violates its remit and interferes with competition without a legal basis. Only if this can be assumed can a violation of market conduct regulations be examined under unfair competition law via Section 3a UWG, in this case a violation of the HCV. Conversely, however, the scope of application of unfair competition law cannot be affirmed simply because an infringement of a market conduct regulation is alleged to have occurred without an act in the course of trade first having to be affirmed. In the latter case, an act may be unlawful, but this alone does not make it actionable under fair trading law.

bb) Irrespective of this, it is also not apparent that the scope of application of the HCV would be opened, because this would require that the present case would be a commercial communication within the meaning of Art. 1 (2) [1] HCV – which is not the case.

(i) It is true that in principle statements made by authorities and organizations close to the state can also be regarded as commercial communications. However, this requires not only that the statement relates to a specific foodstuff or a specifically designated group of foodstuffs and to a specific manufacturer or a specific group of manufacturers, but also that the statement is intended to promote sales (Rathke/Hahn, in: Zipfel/Rathke, LebensmittelR, 174th EL, Art. 1 VO (EG) No. 1924/2006 para. 15).

(ii) It cannot be recognized that this is the defendant’s intention with the statements at issue. With his statements, the defendant obviously did not want to compete with mineral water/bottled water distributors, but merely wanted to provide information about the quality of the drinking water coming out of the tap in his geographical area, which in terms of meaning and purpose corresponds at best to a general nutritional recommendation within the meaning of recital 4 HCV and therefore, according to the understanding of the legislator, should not fall within the scope of application of the HCV. Irrespective of this, the challenged text does not contain any statement that can be understood to mean that the readers addressed should consume more tap water and thus promote the defendant’s sales: The Zweckverband is clearly not concerned with selling water, but with providing information that the water coming out of the tap there can also be used for drinking without hesitation. And even the applicant recognizes that the aim of the statements is precisely not to promote sales when he states that the aim of the campaign is to “minimize an imaginary plastic waste supposedly associated with the consumption of mineral water” (p. 4 of the statement of 4 May 2020, p. 56 of the file).

cc) Insofar as the applicant makes statements on the BGH decisions GRUR 2018, 196 – Eigenbetrieb Friedhöfe and GRUR 2019, 189 – Crailsheimer Stadtblatt II for his legal opinion, this does not lead to success, as these two cases were based on completely different constellations that are not transferable to the present case.

dd) Finally, the present legal opinion does not contradict the decision of the 6th Senate of the OLG Munich in case 6 U 2646/98, because there, too, the Senate obviously only considered compliance with the rules of fair competition to be applicable because in that case it assumed an advertising measure which as such did not belong to the provision of services of general interest. This view does not contradict the view here; the difference, however, is that the statements in question are not to be regarded as an advertising campaign for the reasons described.

III. on the ancillary decisions:

The decisions on costs are based on Section 91 ZPO.

In the case in dispute, which is based on proceedings for an interim injunction, there is no room for the admission of an appeal (see Section 542 (2) sentence 1 ZPO).