June 14 2016 Martin Aquilina, Business Lawyer
On April 8, 2016, the Higher Regional Court for Berlin (“Kammergericht”) issued a judgment on an appeal from the Court of First Instance, initiated by the Federation of German Consumer Organizations (the Verbraucherzentrale Bundesverband) against WhatsApp. Two main issues were considered in the judgment. The first one was whether WhatsApp provides sufficient contact information for direct communication by the users. The Kammergericht cited Section 5(1) No. 2 of the German Telemedia Act[ii] (Telemediengesetz – “TMG”) which states that a service provider needs to provide, in addition to an email address, contact information for fast and direct communication. The Court found that WhatsApp was in breach of the TMG as the current contact information (an email address and hyperlinks to its Facebook and Twitter accounts) is insufficient and ordered that it provide an alternative means of communication (such as a telephone number).
The second issue concerned the T&Cs: while WhatsApp’s website is provided in German, its T&Cs are only provided in English. The Kammergericht found this to be a problem and cited the Reasonableness of Contents test set out in Section 307(1) of the German Civil Code[iii] (Bürgerliches Gesetzbuch), which essentially states that provisions in standard business terms are ineffective if the provisions are not comprehensible to the contractual party who did not author them, hence putting such party at an unreasonable disadvantage. The Court reasoned that although German consumers might be familiar with the English language, the legalese used in the T&Cs can be hard to understand, putting the consumers at an unreasonable disadvantage vis-à-vis their contractual counterpart, WhatsApp. The Kammergericht therefore ruled that the T&Cs without a German translation are invalid and ordered WhatsApp to provide the German consumers with T&Cs in German.
It is interesting to note how the German Court utilized a rule of contract law to make an example out of WhatsApp, a large and famous company, for breaching the cultural right of a people that its national language be used in commercial dealings. This judgment can be seen as a warning to all other foreign companies, multinational or otherwise, operating in Germany that it is insufficient to merely have most of a website in German and an email address as the only contact information. Foreign companies operating in Germany should provide legal documents such as the T&Cs in German and include more contact information than just an email address. A similar rule exists on a wider scale in Europe. Directive 2011/83/EU[iv] affords protection to consumers by requiring traders (a term used to refer to a group of people such as the providers of goods and services) to provide certain information to the consumers before they are bound by a contract. Although the required information depends on the type of contract (whether it is on-premise, off-premise, or distance), for distance and off-premise contracts, a trader needs to provide the consumer, in addition to other information, with its “… telephone number, fax number and e-mail address, where available, to enable the consumer to contact the trader quickly and communicate with him efficiently…”[v] If you are currently operating or planning to operate a business in Europe, it is important that you keep these rules in mind.
[i] KG, Urteil v. 8.4.2016 (5 U 156/14).
[ii] Telemediengesetz (TMG) vom 26. Februar 2007 (BGBl. I S. 179).
[iii] Bürgerliches Gesetzbuch (BGB) in der Fassung der Bekanntmachung vom 2. Januar 2002 (BGBl. I S. 42, 2909; 2003 I S. 738).
[iv] Directive 2011/83/EU of the European Parliament and of the Council of 25 October 2011 on consumer rights, amending Council Directive 93/13/EEC and Directive 1999/44/EC of the European Parliament and of the Council and repealing Council Directive 85/577/EEC and Directive 97/7/EC of the European Parliament and of the Council  OJ L304/64.
[v] Ibid at art 6 para 1(c).
This article is for informational purposes only and does not constitute legal advice. If you wish to discuss your issue with a lawyer, contact Martin today. 613-747-2459 ext.308, [email protected]