Federal Court rules in favour of Amazon: liability for unfair advertising practices remains a grey zone for brands

A significant game-changing case at the German Federal Court of Justice is won by ePrivacy partner UNVERZAGT leaving many brands wondering what to do.

In a landmark decision, the German Federal Court of Justice has impacted the entire affiliate marketing industry: In case of unfair advertising practices, online merchants and affiliate marketing network operators cannot be held responsible for the actions of their affiliate partners (i.e. participating publishers).

This issue has been the subject of years of dispute among German courts with significant implications for online advertising. German Federal Court of Justice decision has now resolved t. ePrivacy’s partner law firm UNVERZAGT defended Amazon’s affiliate network against mattress manufacturer Bett1, which sought to hold Amazon liable for unfair advertising practices.

The disputable case of Amazon and Bett1

Amazon uses advertising links on partner sites to attract potential buyers to its products. Even if questionable partners provide problematic content on their websites, the online mail-order company cannot be held responsible. The Federal Court of Justice (BGH) in Karlsruhe ruled that the prerequisites for liability were not met.

In this particular case, the suing party Bett1, was bothered that such referral links can also be found in fake test reports and provide unserious product tips such as a questionable mattress ranking, in which the company’s product and the brand name have been mentioned.

Bett1.de is not suing Amazon for the first time but was unsuccessful before several higher regional courts. The highest civil judges were also rather skeptical during the hearing as to whether the conditions for Amazon’s liability were met. The partners are not obliged to set links to Amazon, but are also allowed to participate in other partner programs and also negatively discuss linked products. However, the partners themselves are responsible for compliance. The lawyer for the online retailer before the BGH said that there were no options for instructions or content-related specifications. Now Bett1.de can only take action against individual site operators.

What does it mean for the partner marketing industry?

Correct consent management continues to be the focus of the supervisory authorities, causing corresponding liability risks

Until this case, affiliate marketers were considered data controllers under the GDPR. It means affiliate marketers should have control over how personal data is used as well as how the data is handled.

As a result of the case, a deeper separation between these two roles is made by determining who processes data to achieve a certain goal and who does not. Affiliate marketers must now make sure that they comply with the GDPR in addition to compiling their affiliate marketing content with compliance information; this (partial) responsibility now falls on advertisers and brands.

Keeping track of further cases is an important part of Admitad’s commitment to transparency, fairness, and measurement.

Read more about this particular case on the liability of advertising networks or merchants for any third-party content.