Tesco Ireland was told to pay rival retailer Aldi (Ireland) £120,705 (€150,000) damages plus legal costs last week (December 7) to settle a row over an allegedly misleading price campaign.
In a statement issued to FoodManufacture.co.uk, Aldi said: “Aldi is very pleased with the undertakings given to the Court today by Tesco in relation to its inaccurate advertising campaign with respect to Aldi’s products.”
Aldi alleged that Tesco infringed its trademarks by making inaccurate, misleading and unfair price comparisons in its in-store advertising.
It claimed Tesco failed to compare like-for-like, incorrectly stated the sale price of the Aldi product or the Tesco product and failed to compare the relevant quantity of the Tesco product with an equivalent quantity of an Aldi product.
For example, Tesco compared the price of its maple syrup product with an Aldi maple syrup. Aldi alleged that this was misleading because Tesco’s maple syrup contained only 40% maple syrup, while the Aldi product contained 100% Canadian maple syrup. It said this was not comparing like with like.
‘Inaccurate comparative advertising’
Aldi said: “Having repeatedly brought the matter to the attention of Tesco, Aldi was disappointed that no action appeared to have been taken and Tesco continued to use inaccurate comparative advertising, which may have had the effect of inducing customers into making purchasing decisions they may not otherwise have made.
“Aldi therefore, regrettably, had no alternative but to issue proceedings for trademark infringement in the Commercial Division of the High Court against Tesco.”
Tesco has now agreed not to engage in comparative advertising that involves the use of Aldi trademarks in a defined set of circumstances.
It has also undertaken not to use or display comparison of product prices without specifying relevant quality assurance schemes, such as the Bord Bia (Irish Food Board) Quality Assurance mark.
‘Comparative advertising is permitted’
In a statement issued to FoodManufacture.co.uk, Tesco Ireland said: “This statement confirms the important principle, which is that comparative advertising is permitted. This is good for the consumer and it is important additional information that benefits shoppers. We are pleased that this principle is now accepted and endorsed.
“The settlement also sets down clearly for the first time the ground rules for how comparative advertising can happen. It is an important part of the competitive environment in retailing and we are pleased that it can continue within the parameters set out.”
Aldi said it was in favour of comparative advertising as long as it was accurate, fair and not misleading.
Aldi Stores (Ireland) group buying director, Niall O’Connor said: “The effect of today’s undertakings is that consumers can expect and demand clear, transparent and accurate information on comparative advertising to enable them to make properly informed decisions about what they buy and who they buy from.”
Tesco said: “Tesco Ireland accepts the principles set down in the settlement and will continue to drive competition and innovation in the Irish market.”
The judgement was given by the Commercial Court, a division of Dublin’s High Court.